The main takeaways from our meeting with Hai-O are:
(i) the company’s invention is a technology breakthrough and patent applications are pending approval,
(ii) a joint laboratory with IET has started operation,
(iii) the investment return may be large given the low investment cost and wide applications of the technology, and
(iv) positive earnings impact may be felt in 2 years.
Despite the sharp appreciation in its share price recently, we believe there is further upside for Hai-O premised on the
(i) ample growth in its MLM division,
(ii) its new venture into technology, which may be a new growth driver
(iii) attractive dividend yield,
(iv) potential earnings surprise, and share liquidity improvement.
Maintain BUY at RM8.95 (based on 11x PE)
1 comments:
too expensive to me, although i like the management very much, especially the boss mr. Tan