Super Group   

Super Coffee

Super Group, Singapore’s largest instant-coffee maker, is seeking its first acquisition in a decade as it battles Nestle SA for a bigger share of the market in Southeast Asia and China.

“We are building our war chest for acquisitions,” Darren Teo, Super’s head of corporate strategy and business development, said in an interview on July 23. “Organically, the company is doing well, but we are looking at ways we can expand faster. We are at the right time of the growth story.”

The seller of the Owl and Super Coffeemix brands wants to add “fast-growing” coffee producers with established labels, Teo said. The Singapore-based company also wants to buy beverage makers to expand its repertoire of non-coffee brands, he said.

Coffee consumption in countries such as Vietnam and the Philippines surged by at least 55% from 2008 to 2011, more than 10 times quicker than the world average, according to the International Coffee Organization. A total of US$4.2 billion ($5.3 billion) of food and beverage purchases in Southeast Asia were completed this year, according to data compiled by Bloomberg.

The stock climbed 0.4% to $4.77 at 9:35 a.m. in Singapore trading, set for the highest in almost two months. The increase pushed the advance this year to 47%, compared with the 2.8% gain in the Singapore benchmark Straits Times Index.

NESCAFE COMPETITION
Super, whose coffee mix sachets compete with Nestle’s Nescafe, a key product for the world’s biggest foodmaker, is interested in companies with production facilities with ready- made ingredients and a distribution network, said Teo, who makes key strategic decisions at the company on behalf of his father David Teo Kee Bock, the company’s chairman.

Super made its last purchase in 2003 when it bought Owl International Pte, a closely held instant-coffee maker, for about $20 million, said Teo, 30. Along with Owl, the company’s Super Coffeemix brand competes with Nestle in eight Asian countries including Singapore, Malaysia and Thailand, said Teo, whose family has the biggest stake with about a third of Super.

“Consumers have their own preferences and freedom to choose many products in the markets, and we are confident on our competitiveness in the market,” Brata Hardjosubroto, Nestle Indonesia’s head of public relations, said in an e-mailed response to queries yesterday.

Super may seek an acquisition of a closely held coffee producer in Indonesia, the Philippines or China that’s worth as much as $100 million, said James Koh, an analyst at Maybank Kim Eng Holdings.


NEW MARKETS
“Super might be keen to acquire brands that would help them expand their market presence in these places where it is not so strong, or in new markets,” he said.

Super had $96.1 million in cash and securities investments as of March 31, according to its statement in May.

Most of the region’s 650 million people will be middle class by 2020, and spending on food and beverages may climb at least 75% from 2000 levels, according to Accenture Plc.

Successful consumer retail deals often require a known brand name to sell products through its distribution channels, said Tan Han Meng, an analyst at RHB Research. That gives Super the “pan-Asian branding with the potential to be a Nestle in Asia,” and expand market share, he said.

Super may struggle to find a suitable company as valuations aren’t cheap, with the average price-earnings ratio of potential targets exceeding 10 times, RHB’s Tan said.

MYANMAR DRINKS
Shares of Super trade at 31.7 times earnings, compared with the 20 times average of its 12 closest peers in Singapore, according to data compiled by Bloomberg.

The company also plans to introduce new products such as cereal and malt drinks in Myanmar, where it said it’s the market leader. This will help push its annual sales growth to as much as 15% over the next five years, Teo said.

For coffee, the focus will still be on Nestle, which Deutsche Bank AG said in a report last year controls half of the global market for the instant beverage.

“When it comes to coffee, you’ll think of Nescafe, but we’re probably the second name that comes to mind” in Asia, Teo said. “We are not afraid of competition.”

 

teh or kopi:)

ysh2006      ( Date: 28-Jun-2013 23:09) Posted: This is super stock, last time I have a similar thinking but the longer one wait , I need to take lift to chase the price $ 2, $3, $ 4 , $ 5 ?...if not can't get it leh... New123      ( Date: 28-Jun-2013 21:04) Posted: i think may snow dive to $2.00 and below when recession set in .

 

This is super stock, last time I have a similar thinking but the longer one wait , I need to take lift to chase the price $ 2, $3, $ 4 , $ 5 ?...if not can't get it leh...

New123      ( Date: 28-Jun-2013 21:04) Posted: i think may snow dive to $2.00 and below when recession set in .

 

i think may snow dive to $2.00 and below when recession set in .

 

Singapore “Flyer” Of The Week: Super Group

It would probably have been easier to look for hen’s teeth than try to find outstanding stock market performers this week. But even in a down-market there are shares that can shine.

One share that did stand out was Super Group (SGX: S10). That said, you would not have guessed the food producer would even be on the fringes of the Singapore “Flyer” reserve list at the start of the week.

Shares in the food producer kicked off the trading week by dropping 5%. On Tuesday it had recovered some of its poise to register a 3% improvement. By Wednesday things were almost back to normal as the shares shot up 8.5% to $4.18.

On Thursday morning, Super Group climbed another 8% to S$4.50. So, at the time of writing, Super Group is one of the best performing shares in the Singapore market – up 14% on the week. By comparison, the Straits Times Index (SGX: ^STI) is 0.2% higher.

Question is: What has changed during the week that could have caused the company’s market value to swing a couple of hundred million Singapore dollars?

The answer is nothing at all has happened at the company. Super Group is the same today as it was a week ago. I can attest to that – I am  drinking its Owl brand instant teh tarik now and it tastes as good today as it did last week.

In fact, it was only last month that the company posted a 24% jump in first-quarter profits on sales that gained 9%. The company attributed the improvement to higher gross margins, thanks to better use of its production capacity.

It would seem that Super Group had unwittingly become a victim of stock market volatility. Volatile share prices are one of the risks that we have to bear as stock market investors. That is why there is a premium for owning shares – the equity risk premium. That is also why  the returns from investing in shares beats  leaving your money in the bank as cash over the long term – we are rewarded  for taking on the risk.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.

 

Macquarie upgrades to O/p, TP $4.80. Note that buying opportunity. fundamental growth drivers are still intact, current undemanding valuations is an attractive entry point to a high quality, cash generative business. Branded Consumer sales set to recover in 2Q. Margin expansion story still intact, albeit only in 2013 now. Currently trading at 19x 2014E PE, backed by a solid 21% EPS CAGR (12-14E)

 

The configuration is negative.

4.05 is our pivot point.

Our preference: the downside prevails as long as 4.05 is resistance.

Alternative scenario: the upside breakout of 4.05 would call for 4.27 and 4.4.

Comment: the RSI is trading below 30. This could mean that either the stock is in a lasting downtrend or just oversold and that therefore a rebound could shape (look for bullish divergence in this case). The MACD is below its signal line and negative. The configuration is negative. Moreover, the stock

 

So, the bond purchase programme instituted by the US Federal Reserve is projected to end in 2014. A tapering of the programme is expected to begin before the last quarter of this year. With the impending conclusion of this programme, long term interest rates are expected to rise.

While the Federal Reserve said that it would maintain short term interest rates at its current near zero levels at least until 2015, investors have been reading the latest developments as the end of an era. The era of low interest rates. When the age of low interest rates draws to a close, increasing costs of capital will become a reality for all companies.

In an earlier article , the Shares Investment team noted that two main company centric factors should be taken into consideration. This, especially so when investors are trying to brace for the end of Quantitative Easing.

Bracing For The End Of QE – Low Debt, High Cash!
Essentially, the article speaks about how highly leveraged companies in capital intensive sectors will definitely feel the pinch (or blow). So to combat this, we at Tradeable felt that companies who might be able to weather at least the initial onslaught of higher interest rates will be companies who have lower debts (duh!).

Also, in our analysis, we figured that companies with a large cash hoard will be better placed to negotiate a high interest rate climate. So the main ratios we have used to screen all the companies on the stock market were:

• Total Debt/Total Equity
• Total Cash/Total Equity

Aside from these two primary factors, we have also done some fundamental analysis homework for you! We have come up with three great stocks that you can look at in your efforts to brace your portfolio against higher interest rates.


Source: Company’s financial reports

Super Group – Large Hoard Of Cash For Expansion?
According to our analysis, Super Group has low debt for its relative size. Its gearing levels (total debt/total equity) as at 31 March 2013 stood at 0.21 while its sizeable cash hoard of around $93.6 million has put it within our scopes.

On the fundamental side, Super Group currently boasts a market leading position in the new economic frontier that is Myanmar. The firm has been in the country for around 15 years and is a market leader there with a market share of more than 40 percent.

Even though the recent riots in Myanmar have dampened 1Q13 growth there, analysts note that Super Group still has firm growth prospects in that country as well as in other countries such as China and the Philippines.

The sizeable cash hoard as well as strong cash flow generation by its operating segments have continued to be a boon for Super Group.


Source: FactSet, candlestick graph depicting Super Group’s share price movements over the past 1 month

On the technical analysis front however, Super Group appears to be heading on a downward trend as our shorter, two day moving average line is heading south. The divergence of both the short term (two days) and longer term (19 days) moving average lines also indicate that the stock could be headed for further volatility.

SIA Engineering – The Magpie Of SGX?
SIA Engineering (SIAE) has a low gearing ratio (total debt/total equity) of 0.20 and an extremely high level of cash as at 31 March 2013. The amount of cash is twice (based on total cash/total equity) of the amount of the total debt ratio (based on total debt/total equity). Essentially, a magpie gathering all that glitters in its nest.

Looking forward, the company is well poised for growth as it has the necessary capital to expand its facilities. We expect the company to expand its facilities to accommodate the increase in workload when the Airbus A350 goes into operation.

The A350 is a new wide-body aircraft by Airbus that has attracted much interest from different airlines as demand for bigger long-haul aircraft increases. Specifically, the A350 only uses the Trent Engine which is from manufacturer, Rolls Royce. It just so happens that SIAE is part of a joint venture (JV) which specialises in fixing Trent Engines. We are of the opinion that, given SIAE’s expertise as well as experience, demand for its engineering services should increase when the A350 enters into services.

Perhaps a common misunderstanding amongst investors is that SIAE only services SIA’s planes. However, in reality, SIAE does servicing for other airlines through its JVs. These accounts for more than 30 percent of its revenue. With the positive servicing demand outlook, we expect SIAE to increase its capacity beyond the current 250 engine repairs a year to meet demand.


Source: FactSet, candlestick graph depicting SIA Engineering’s share price movements over the past 1 month

While the fundamentals look good, market watchers have largely given SIAE neutral ratings. Looking at our technical analysis however, we find that the recent correction to SIAE seems to have ended. The short term (two days) moving average line has now cut the longer term (19 days) moving average line. The “piercing” of the 19 days moving average line by the two days moving average line should be seen as a buying opportunity for investors. However, investors should still be wary about dipping into the pool as macroeconomic news could still cause the upward trend to flip.

Raffles Medical Group – In The Pink Of Health
Raffles Medical Group (RMG) has amassed significant cash as the group previously planned to redevelop the property on 30 Bideford Road to a medical centre. However, the plan was rejected by the government twice. RMG has since approached Jones Lang LaSalle regarding the sale of the property which is expected to increase the cash position of the group.

Looking at its gearing ratio (total debt/total equity), it is currently low at 0.17 which is nearly half of its cash reserve ratio(total cash/total equity).

Aside from its financial health, the recent haze situation in Singapore might bring in an unexpected gain in revenue for the group. With the recent pollutant index hitting over 400, we can foresee an increase in outpatient clinic visits as the haze is likely to bring about respiratory issues for patients. With a strong network of clinics in Singapore, RMG is well positioned to take advantage in this situation.

RMG is a domestic private healthcare player with more than 95 percent of its revenue derived from Singapore. In recent years, however, RMG has been diversifying its business through expansion in China. Currently, it operates a medical centre in Shanghai and is looking be involved in an integrated international hospital development in Shenzhen. The expansion in China, a growing market in the healthcare sector, is sure to bring more value to investors.


Source: FactSet, candlestick graph depicting Raffles Medical’s share price movements over the past 1 month

The recent correction to RMG’s share price may have taken its toll. However, according to our technical analysis, the stock may be on the verge of rallying. RMG’s short term (two days) moving average is converging with the longer term (19 days) moving average. It may present a buying opportunity for investors if the lower moving average line passes through the moving average line above. In the meantime, investors might want to continue to monitor RMG’s stock price movement.

krisluke      ( Date: 18-Jan-2011 12:36) Posted: wah seh ! !! 147 liao. vested last year. hmm yum yum ^-^

 

Smile with the new SUPER COFFEE!

An avid coffee lover? Tantalise your tastebuds by drinking Super Coffee in the morning!

 

DBS VICKERS Securities

_{SUPER GROUP LTD | BUY | TP:S$5.35}

1Q13 earnings of S$22.1m were in line, making up 23% of our full year earnings estimate of S$100m Revenue was in line at S$132m making up on 21% of our S$629m projection for the full year Key earnings drivers were (i) Food Ingredient (FI) Segment (revenue +33% y-o-y) and (ii) higher gross margins from Branded Consumer (BC) segment

Group gross margins outperformed our expectations coming in at 37% on lower raw material costs We believe that growth from both BC and FI segments are sustainable. The FI segment has now reached a sizeable revenue base since FY09, and is now breaking into Indonesia and winning more customers on long term supply contracts. This will help to supplement growth from seasonal impact from North Asia. 

Although BC revenue was flat, affected by Myanmar and Malaysia, we expect sales to normalize in the next few quarters with restocking and increased marketing campaigns.

We leave our FY13F/FY14F core earnings unchanged as Super remains on track to meet our full year earnings estimates of S$100m
Rolling forward our valuation base from FY13F to FY14F, we raise our TP to S$5.35 based on 26x FY14F PE.  ....last done: $4.82...

 

This chart breakout is a classic. But volume did not increase along with it .

It maybe a false breakout

 

1Q13 results were within expectations. Recurring net profit growth of 30% yoy were driven by higher revenue and better margins.

 Margins to moderate over the next few quarters, expect strength due to 1) higher-value products coming on stream and economies of scale.

 Resilient earnings and a free cash flow which will grow exponentially from next year,

  Maybank Kim Eng has a  fresh TP of SGD6.30, implying 30% upside from here.

Dare to buy??

 

Full-screen chart

 

Formed a shooting star. Good luck. 

 

 

Super Group Ltd: BUY S$4.08 Bloomberg: SUPER SP Disposes non-core China property investment associate, invest US$20m in plant Price Target : 12-Month S$ 4.68 By: Alfie YEO +65 6398 7957 • Disposal of entire 35.3% stake in non-core associate company Sun Resources for S$26m gain on sale of S$16m • FY13F earnings and dividends raised by 14% • Super also announced that it will invest US$20m in its Botanical Herbal Extract Plant in Johor Bahru • Maintain BUY and S$4.68 TP Super announced that it is disposing its entire 35.3% stake in non-core associate, Sun Resources, for S$26m. Sun Resources develops property in China which is a non-core investment for Super. Super will recognize a gain of S$16m from the disposal. Super will receive the S$26m cash in two installments of S$13m, on 6 May 2013 and 5 May 2014. The S$16m gain will increase our net earnings (core+non-core) and dividend estimate by 14% for FY13F. This will increase dividend yield from 2.2% to 2.5% assuming a minimum dividend payout of 50% for FY13F. In a separate announcement, Super announced that it will be investing US $20m for capex and working capital in its Botanical Herbal Extract Plant in Johor Bahru. Super is expanding its ingredients business by establishing a 3,000 mt a year Botanical Herbal Extract manufacturing capacity capable of extracting plant and fruit based flavours for injection into tea and coffee. The line is expected to commence production in 2H13. As capacity is small, revenue impact is not expected to be significant. Super is due to announce 1Q13 results on 13 May. We currently have a TP of S$4.68 and look to update our earnings post 1Q13 results release. Our PE based valuation on Super remains unchanged as this development has no impact on core earnings. Maintain BUY and S$4.68 TP.

 

The stock could retrace in the short term.

Our pivot point stands at 3.81.

Our preference: as long as 3.81 is support look for 4.18.

Alternative scenario: the downside breakout of 3.81 would call for 3.68 and 3.6.

Comment: the RSI is above 50. The MACD is below its signal line and positive. The stock could retrace in the short term. Moreover, the stock is trading above both its 20 and 50 day MA (respectively at 3.88 and 3.82). Super Group/Singapore is currently trading near its 52 week high reached at 4.06 on 04/

 

UOB Kay Hian maintains Buy with $4.54 TP. House upbeat on the group’s rebranding exercise and push into China’s coffee market. Expect the rebranding exercise to refresh its brand positioning as well as enhance its pricing power in the medium term. The rebranding exercise has enjoyed high visibility, particularly amongst the younger consumers, which house believe is critical in the long term. Overall, house maintain BUY on Super with TP of $4.54, implying a 22.1x FY13 P/E, which is at the high end of the stock’s historical PE range of 7-24x since 2003. Despite the high valuation, believe its improving brand positioning, strong cashflow, solid execution and market share in selective growth markets such as Myanmar and the Philippines as well as China venture put it on a new growth trajectory.

 

siao liao....i got it at 3.87 and thought i got a gd bargain....haha

bishan22      ( Date: 18-Mar-2013 10:09) Posted: Down again. Better wait for reversal.

 

Down again. Better wait for reversal.