Home Capital Broker's Calls

Time to restock on QAF

Gwyneth Yeo
Gwyneth Yeo8/17/2016 03:07 PM GMT+08  • 2 min read
Time to restock on QAF
SINGAPORE (Aug 17): OCBC Investment Research has maintained its “buy” recommendation for QAF, with a higher fair value of $1.33 from $1.27 previously, on the back of the group’s declared interim dividend, its stock outperformance against the Straits
Font Resizer
Share to WhatsappShare to FacebookShare to LinkedInMore Share
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.

SINGAPORE (Aug 17): OCBC Investment Research has maintained its “buy” recommendation for QAF, with a higher fair value of $1.33 from $1.27 previously, on the back of the group’s declared interim dividend, its stock outperformance against the Straits Times Index, favourable outlook for feed prices, and continued capacity expansion plans.

OCBC analyst Jodie Foo points out that that QAF had recently renewed the licensing agreement granting Gardenia Bakeries KL (GBKL) the use of the “Gardenia” trademarks on bread and other bakery products manufactured in Malaysia for five more years, ending March 2021.

Although the licensing fee was cut from 5.25% to 1.5% of gross sales of each approved bakery owned and operated by GBKL, Foo is not too concerned by the new development. “While QAF gets a lower licensing fee, this would be partially offset by a higher share of contribution from JV,” says Foo. “This quarter, we saw $1.81 million of share of profits from JV.”

For more insights on corporate trends...
Sign In or Create an account to access our premium content.
Subscription Entitlements:
Less than $9 per month
Unlimited access to latest and premium articles
3 Simultaneous logins across all devices
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)
×
Loading next article...
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
Subscribe to The Edge Singapore
Get credible investing ideas from our in-depth stock analysis, interviews with key executives, corporate movements coverage and their impact on the market.
© 2022 The Edge Publishing Pte Ltd. All rights reserved.
Unlock unlimited access to premium articles with less than $9 per month. Subscribe Now