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Monday, June 29, 2015

HOVID - HALF YEAR REVIEWS

After nearly half years past of my first post, or two quarter after my first post, I decided to write a reviews and follow up with HOVID, which also consider part 2 of HOVID.

Why? Because six sense tell me its the best time for me to share about this stock once again. Lets reviews on past performance of HOVID. 


I remember previously I shared on HOVID on 26 November 2014, which price around 0.385, as of today trading at 0.485. About 25%. If you able to sell at high 0.56 you will gain a 45% return. Is that enough for you? For me, I not satisfy with such profit yet. Why? Because its long term investment, and therefore I looking for 200% at least. 


Lets look at our Malaysia TOP 30 company or we call FBMKLCI index. Overall performance was 2 major deep down since November 2014 until now end of June 2015. What we can see is HOVID performance is much better than these 30 index stock performance and the price of HOVID did not drop way back to 0.325 although index drop almost close to past year level. Why?


By looking back financial result, quarter 2 and 3 is obviously better than last year. Is that the reason why price is did not go back to last year low? Or there is other reason to support it?

We also take their one of their major partner to see how is actually this sector doing in other country.

We take SANOFI as you can see SANOFI is a great France company. Refer Here <---


Even Europe is having crisis, we can see that SANOFI is very steady uptrend. If you check SANOFI listed at New York, it's also very steady uptrend. And have a look at our PHARMA, CCMBIO,YSPSAH, all are actually very steady ! This sector is very defensive and recession proved ! Its a long term stock for sure !
 

Let me elaborate how the new plant will benefit you and their company. Its say that their tablet and capsule account for roughly 60% of their revenue. 

We take average revenue for past 3 quarter = 48 Million

Tablet and capsule = 60% of Revenue = Total 48 Mil x 60% = 28.8 Mil

New plant increase 30% production = 28.8 Mil x 30% = 8.64 Mil

Which mean, new plant at least will increase revenue to about 48+8 = 56 Mil 

How much the net profit might increase?

We take 5 mil as average earning per quarter X existing plant 60% = 3 Mil

3 Mil come from existing tablet and capsule plant.

3 Mil X 30% new plant = 0.9 Mil. 

Which mean, the new plant will roughly contribute net profit of 1 Million, which they claims will have higher efficiency that might turn up roughly 1-2 Million.

How much it can affect EPS for only 1 Million? 1/774 million shares = 0.00129 EPS

Which by taking estimate coming quarter and futures, net profit about 7-8 Million at least which will get EPS around 0.0088 EPS

A quick calculation : 0.0088 X 4 quarter = 0.0352 EPS per year. 

0.0352 x 10 pe = 0.352
0.0352 x 15 pe = 0.528
0.0352 x 20 pe = 0.704

Currently HOVID is trading at about PE 20. In futures when the new plant fully contribute, we shall see stable cash income for HOVID. More to say, they still have second phase of plant that going to be ready in coming few month. 

So as a conclusion, HOVID is fairly cheap at this moment. Market drop will offer opportunity to collect HOVID for futures long term play. 

My target remain, 0.60 and 1.0. Long term I will hold until I die and pass to my family as retire fund for them and toy fun for children. 

Thank you HOVID, and think closely, how many chance we can grabs a stock at cheap price if market did not crash ? 

http://klse.i3investor.com/blogs/logictradinganalysis/79137.jsp

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