PADINI – Fundamental Analysis (21 Nov 2014)

PADINI Analysis:-

Excel – http://1drv.ms/1xUnYNu

My View:-

– Fair value
  – Absolute EY%:
    – Trailing:
      – FY14 (EPS: 0.138) – Fair value 1.84 (Fair Value Uncertainty: HIGH)
      – R4Q (EPS: 0.138) – Fair value 1.84 (Fair Value Uncertainty: HIGH)
    – Forward:
      – FY15 (EPS: 0.158) – Fair value 2.11 (Fair Value Uncertainty: MEDIUM)
      – FY16 (EPS: 0.173) – Fair value 2.31 (Fair Value Uncertainty: MEDIUM)
    – EPS applied to reach the current stock price (1.73): 0.13
– In my opinion, at 1.73, I think PADINI valuation is attractive due to
i) attractive dividend yield of 8%
ii) commendable top line growth backed by aggressive expansion
iii) BO stores targeting the value-for-money segment which will do well in current economic environment
iv) highly experienced management team with a strong local retail market knowledge
v) Expected to regain its Shariah compliant status in November 2014 – It had addressed the issue by reallocating a portion of its cash into Islamic instruments in order to be in compliant with the requirement of the SC’s List.
– For recent sector analysis, please read https://lcchong.files.wordpress.com/2014/03/apparels-the-busy-weekly-15032014.pdf

Latest Financial – Annual Report 2014 (27 Aug 2014) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1799353

At the time of writing, I owned shares of PADINI.

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