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20-07-2024, 10:38 AM
For many years prior to Covid-19, Apollo Food was boring company with declining returns. All that changed post Covid-19 with profits shooting up.
Then came the change in controlling shareholders in Dec 2023. The new controlling party are the people behind the Baskin-Robbins franchise in Malaysia and Singapore.
![[Image: Apollo-returns.png]](https://i.postimg.cc/kMNXyyL3/Apollo-returns.png)
The market price today at RM 6.70 per share is much higher than the RM 5.80 the new controlling shareholder paid for Apollo.
My valuation of Apollo based on the past 12 years performance came to about RM 5.11 per share. The confectionary business is not a high growth one and to drive 30% business improvements (implied by comparing market price with my business value) would be challenging.
Unless of course there is some plan to inject other profitable business into the company. Why would anyone pay a premium for a company unless they have plans to do magic with it?
For more insights visit Is Apollo Food an investment opportunity?
Then came the change in controlling shareholders in Dec 2023. The new controlling party are the people behind the Baskin-Robbins franchise in Malaysia and Singapore.
The market price today at RM 6.70 per share is much higher than the RM 5.80 the new controlling shareholder paid for Apollo.
My valuation of Apollo based on the past 12 years performance came to about RM 5.11 per share. The confectionary business is not a high growth one and to drive 30% business improvements (implied by comparing market price with my business value) would be challenging.
Unless of course there is some plan to inject other profitable business into the company. Why would anyone pay a premium for a company unless they have plans to do magic with it?
For more insights visit Is Apollo Food an investment opportunity?