Tuesday, December 3, 2013

UOBKH 2014 Top BUYs – MID Caps- OSIM International

OSIM International
Share Price S$2.21
Target Price S$2.76

BACKGROUND
OSIM International (OSIM) creates, designs, develops and markets well-being and healthy lifestyle products through its specialty retail outlets worldwide. Its products include massage chairs, foot massagers, neck & shoulder massagers, head massagers, fitness equipment, diagnostic equipment, vitamin & supplements, and luxury tea. The company has a portfolio of brands including OSIM, TWG, RichLife, GNC and Brookstone.


• Consistent earnings growth backed by product innovation and productivity. OSIM reported a 19th consecutive set of record quarterly earnings in 3Q13 with net profit growing 16% yoy to S$23m. This was driven by strong revenue growth from new products and higher sales per store and per salesperson. Management remains upbeat on earnings outlook after sales of their uAngel and uInfinity massage chairs gained traction in the quarter. Management has also seen several trade-ins of the uDivine chairs, a product launched three years ago. This shows that OSIM is on the right track in creating long-term demand and brand loyalty to its OSIM chairs.

• TWG the next crown jewel for OSIM. The company has also increased its stakes in TWG in 4Q13 to 53.7% and will consolidate its earnings into OSIM’s financial statements going forward. There are currently 22 TWG boutiques and OSIM targets to expand the network further in Singapore, Korea, Thailand and Malaysia. OSIM reiterated that each location continues to be profitable on its own with an annual 3-5% yoy same-store sales growth. In China, TWG tea has penetrated 60 luxury hotels and OSIM has plans to open 6 tea boutiques in the country next year.

• Building a cash war chest with EBITDA margin of more than 20%. OSIM continues to generate very strong cash flow due to its cash-based business and low working capital needs. As at 30 Sep 13, OSIM had cash and cash equivalent of S$283m. With such a strong cash position, we expect the company to pay out healthy dividends, undertake share buybacks and be on the lookout for potential brand acquisitions.

• Maintain BUY and target price of S$2.76, derived from the average of our dividend discounted cash flow model and pegged at its 3-year historical PE of 15.7x to our 2014F earnings. Although management still maintains its profit guidance of a 15% growth in bottom line, we believe the company can exceed expectations and record a net profit of S$108.1m (+24.3% yoy) in 2013. The company is also expected to maintain a dividend of 6 S cents/share for 2013, providing a yield of 2.7% as of the last traded price




Source/Extract/Excerpts/来源/转贴/摘录: UOBKH-Research,
Publish date: 28/11/13

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Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
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