Ban Leong Tech

[VestedInterest]

Was looking at Ban Leongs's last financial report, ie. 1H FY11/12, which was lodeged in Nov 2011.
Looks interesting: Revenue flat, PAT improved 33%, slight improvement in gross and net profit margins, EPS 1.09 cents (looking at past reports, BLT earns more in the 2nd half of the FY- usually 60% of their earnings, presumably over the Dec and Jan festive seasons and the various IT fairs- hence annualised EPS should be in the region of 2 cents or more), NAV around 20 cents.
Worrying observation is their increase in trade receivables and inventory turnover and decrease in cash and cash equivalents.
At a price of 12 cents, PE should be about 5- 6 (projected-taking into the possible annual EPS of 2 cents). If it gives out a div or 0.5 cents or 1 cent, yield will be between 4- 8%. This however is a very illiquid stock and the computer business is highly volatile.
Anyone any thoughts on this counter?

[camelking]

Was looking at Ban Leongs's last financial report, ie. 1H FY11/12, which was lodeged in Nov 2011.
Looks interesting: Revenue flat, PAT improved 33%, slight improvement in gross and net profit margins, EPS 1.09 cents (looking at past reports, BLT earns more in the 2nd half of the FY- usually 60% of their earnings, presumably over the Dec and Jan festive seasons and the various IT fairs- hence annualised EPS should be in the region of 2 cents or more), NAV around 20 cents.
Worrying observation is their increase in trade receivables and inventory turnover and decrease in cash and cash equivalents.
At a price of 12 cents, PE should be about 5- 6 (projected-taking into the possible annual EPS of 2 cents). If it gives out a div or 0.5 cents or 1 cent, yield will be between 4- 8%. This however is a very illiquid stock and the computer business is highly volatile.
Anyone any thoughts on this counter?

Been investing in equities for a number of years. And ALL of my losses came from investing in the below categories of companies
1. Small cap company (less than $200m)
2. Overseas companies
3. Electronics related companies

1.Illiquidity is one thing, small float of shares which allow manipulation is another reason.
In addition, being small means that they will find it more difficult to recover from recession,changes in industry landscape and lost of a major client.
2. I am refering to Hong Kong and China companies. They can report huge profits for a year to be followed by huge losses the next year.
And "why are they listed in Singapore?"
3. Electronics. The industry changes so fast. What do we know about the industry really? There is no cycle to follow unlike shipping and property. The general economy can be doing well but if the electronic company u invested has not adapted to the rapid changes in the industry, the company is dead and so are you.

Just my opinion...

[RBM]

I like the way camelking thoughtfully formulates, in particular, the first and third points of his posting - I would worry that Ban Leong need to be perpetually at the front of the IT knowledge curve just to survive. And this counter can go more than a week without a single trade.

I have to admit looking at this company some months ago as well. Out of curiosity I looked at Ban Leong's financials over the last three years, when the First Half results came in - revenues seem to be constantly declining (and I took into account the 15 months Financial Year they had in 2008/2009) and the cost trends are not good, i.e. on the up. They have also clearly had problems in Australasia, viz. their recent management change.

Another predjudice .......... which I am NOT proud to admit ..... is that Ban Leong's management team looked like they were still on their ten o'clock bottles. So young! (or I am so old!).

Not vested ............ just my two cents

Was looking at Ban Leongs's last financial report, ie. 1H FY11/12, which was lodeged in Nov 2011.
Looks interesting: Revenue flat, PAT improved 33%, slight improvement in gross and net profit margins, EPS 1.09 cents (looking at past reports, BLT earns more in the 2nd half of the FY- usually 60% of their earnings, presumably over the Dec and Jan festive seasons and the various IT fairs- hence annualised EPS should be in the region of 2 cents or more), NAV around 20 cents.
Worrying observation is their increase in trade receivables and inventory turnover and decrease in cash and cash equivalents.
At a price of 12 cents, PE should be about 5- 6 (projected-taking into the possible annual EPS of 2 cents). If it gives out a div or 0.5 cents or 1 cent, yield will be between 4- 8%. This however is a very illiquid stock and the computer business is highly volatile.
Anyone any thoughts on this counter?

Been investing in equities for a number of years. And ALL of my losses came from investing in the below categories of companies
1. Small cap company (less than $200m)
2. Overseas companies
3. Electronics related companies

1.Illiquidity is one thing, small float of shares which allow manipulation is another reason.
In addition, being small means that they will find it more difficult to recover from recession,changes in industry landscape and lost of a major client.
2. I am refering to Hong Kong and China companies. They can report huge profits for a year to be followed by huge losses the next year.
And "why are they listed in Singapore?"
3. Electronics. The industry changes so fast. What do we know about the industry really? There is no cycle to follow unlike shipping and property. The general economy can be doing well but if the electronic company u invested has not adapted to the rapid changes in the industry, the company is dead and so are you.

Just my opinion...

[Drizzt]

this kind of business is like an import and exporter, somewhat perhaps similar to challenger. the management becomes very important i feel. if they fark it up could wipe out alot of the cash holdings.

[VestedInterest]

Was looking at Ban Leongs's last financial report, ie. 1H FY11/12, which was lodeged in Nov 2011.
Looks interesting: Revenue flat, PAT improved 33%, slight improvement in gross and net profit margins, EPS 1.09 cents (looking at past reports, BLT earns more in the 2nd half of the FY- usually 60% of their earnings, presumably over the Dec and Jan festive seasons and the various IT fairs- hence annualised EPS should be in the region of 2 cents or more), NAV around 20 cents.
Worrying observation is their increase in trade receivables and inventory turnover and decrease in cash and cash equivalents.
At a price of 12 cents, PE should be about 5- 6 (projected-taking into the possible annual EPS of 2 cents). If it gives out a div or 0.5 cents or 1 cent, yield will be between 4- 8%. This however is a very illiquid stock and the computer business is highly volatile.
Anyone any thoughts on this counter?

Been investing in equities for a number of years. And ALL of my losses came from investing in the below categories of companies
1. Small cap company (less than $200m)
2. Overseas companies
3. Electronics related companies

1.Illiquidity is one thing, small float of shares which allow manipulation is another reason.
In addition, being small means that they will find it more difficult to recover from recession,changes in industry landscape and lost of a major client.
2. I am refering to Hong Kong and China companies. They can report huge profits for a year to be followed by huge losses the next year.
And "why are they listed in Singapore?"
3. Electronics. The industry changes so fast. What do we know about the industry really? There is no cycle to follow unlike shipping and property. The general economy can be doing well but if the electronic company u invested has not adapted to the rapid changes in the industry, the company is dead and so are you.

Just my opinion...

Agree that small cap stocks can be very risky. They're always the first to fall and the last to rise. And their small reserves leaves not much room for error, on the managment's part..and the investor as well. But if you pick a good one, the results can be very satisfying and the investor can be rewarded handsomely. Here is where the potential multibaggers lie. Many of our mid-caps and some of our large caps were once small caps. They had to start somewhere.
The fact is that small caps are often overlooked by the analysts and big investment houses- so there are some undiscovered gems out there. Of course, one needs to have the stomach to weather the volatility and be able to sit tight patiently for the storms to come and go.

On point 2, what is your definition of overseas? If you refer to S-chips, then I totally agree with you.

Point 3- agree with you on this as well. I dislike especially those chip companies, plastic moulding companies, contract manufacturers, etc. But Challenger, ECS, Epicentre whose businesses are more on the retail end of the supply chain are more acceptable to me (though I am not vested in them at the moment). I guess Ban Leong sits some where in between the two ends of the spectrum.

[camelking]

Was looking at Ban Leongs's last financial report, ie. 1H FY11/12, which was lodeged in Nov 2011.
Looks interesting: Revenue flat, PAT improved 33%, slight improvement in gross and net profit margins, EPS 1.09 cents (looking at past reports, BLT earns more in the 2nd half of the FY- usually 60% of their earnings, presumably over the Dec and Jan festive seasons and the various IT fairs- hence annualised EPS should be in the region of 2 cents or more), NAV around 20 cents.
Worrying observation is their increase in trade receivables and inventory turnover and decrease in cash and cash equivalents.
At a price of 12 cents, PE should be about 5- 6 (projected-taking into the possible annual EPS of 2 cents). If it gives out a div or 0.5 cents or 1 cent, yield will be between 4- 8%. This however is a very illiquid stock and the computer business is highly volatile.
Anyone any thoughts on this counter?

Been investing in equities for a number of years. And ALL of my losses came from investing in the below categories of companies
1. Small cap company (less than $200m)
2. Overseas companies
3. Electronics related companies

1.Illiquidity is one thing, small float of shares which allow manipulation is another reason.
In addition, being small means that they will find it more difficult to recover from recession,changes in industry landscape and lost of a major client.
2. I am refering to Hong Kong and China companies. They can report huge profits for a year to be followed by huge losses the next year.
And "why are they listed in Singapore?"
3. Electronics. The industry changes so fast. What do we know about the industry really? There is no cycle to follow unlike shipping and property. The general economy can be doing well but if the electronic company u invested has not adapted to the rapid changes in the industry, the company is dead and so are you.

Just my opinion...

Agree that small cap stocks can be very risky. They're always the first to fall and the last to rise. And their small reserves leaves not much room for error, on the managment's part..and the investor as well. But if you pick a good one, the results can be very satisfying and the investor can be rewarded handsomely. Here is where the potential multibaggers lie. Many of our mid-caps and some of our large caps were once small caps. They had to start somewhere.
The fact is that small caps are often overlooked by the analysts and big investment houses- so there are some undiscovered gems out there. Of course, one needs to have the stomach to weather the volatility and be able to sit tight patiently for the storms to come and go.

On point 2, what is your definition of overseas? If you refer to S-chips, then I totally agree with you.

Point 3- agree with you on this as well. I dislike especially those chip companies, plastic moulding companies, contract manufacturers, etc. But Challenger, ECS, Epicentre whose businesses are more on the retail end of the supply chain are more acceptable to me (though I am not vested in them at the moment). I guess Ban Leong sits some where in between the two ends of the spectrum.

Yes, they can be multi-baggers. These multi-baggers help to offset the losses.....hahahahaha
Mainly companies from north asia...including HK and Taiwan...
Avoid them at all costs!
I am not so comfortable with retail industries.....
The locations are mainly owned by Reits and we know very well about Reits and their "contribution" to rising rentals...
Another factor will be labour. Singapore is cutting down on cheap foreign labour and that means rising labour costs.
So, if you want to go for retails, go for the high end retails.. ie hour glass and etc....the margin is huge enough to offset those ever rising rental and labour...but of course, if somehow, they lose the distributorship, the company will be in trouble.. (Jardine C&C lost Mercedes distributorship)

If you ask me which industry to go in NOW, I said Shipping, right in the mddle of the storm. Container shipping is suffering both economic downturn and oversupply of ships. High risk = high returns.

---

I like the way camelking thoughtfully formulates, in particular, the first and third points of his posting - I would worry that Ban Leong need to be perpetually at the front of the IT knowledge curve just to survive. And this counter can go more than a week without a single trade.

I have to admit looking at this company some months ago as well. Out of curiosity I looked at Ban Leong's financials over the last three years, when the First Half results came in - revenues seem to be constantly declining (and I took into account the 15 months Financial Year they had in 2008/2009) and the cost trends are not good, i.e. on the up. They have also clearly had problems in Australasia, viz. their recent management change.

Another predjudice .......... which I am NOT proud to admit ..... is that Ban Leong's management team looked like they were still on their ten o'clock bottles. So young! (or I am so old!).

Not vested ............ just my two cents

Was looking at Ban Leongs's last financial report, ie. 1H FY11/12, which was lodeged in Nov 2011.
Looks interesting: Revenue flat, PAT improved 33%, slight improvement in gross and net profit margins, EPS 1.09 cents (looking at past reports, BLT earns more in the 2nd half of the FY- usually 60% of their earnings, presumably over the Dec and Jan festive seasons and the various IT fairs- hence annualised EPS should be in the region of 2 cents or more), NAV around 20 cents.
Worrying observation is their increase in trade receivables and inventory turnover and decrease in cash and cash equivalents.
At a price of 12 cents, PE should be about 5- 6 (projected-taking into the possible annual EPS of 2 cents). If it gives out a div or 0.5 cents or 1 cent, yield will be between 4- 8%. This however is a very illiquid stock and the computer business is highly volatile.
Anyone any thoughts on this counter?

Been investing in equities for a number of years. And ALL of my losses came from investing in the below categories of companies
1. Small cap company (less than $200m)
2. Overseas companies
3. Electronics related companies

1.Illiquidity is one thing, small float of shares which allow manipulation is another reason.
In addition, being small means that they will find it more difficult to recover from recession,changes in industry landscape and lost of a major client.
2. I am refering to Hong Kong and China companies. They can report huge profits for a year to be followed by huge losses the next year.
And "why are they listed in Singapore?"
3. Electronics. The industry changes so fast. What do we know about the industry really? There is no cycle to follow unlike shipping and property. The general economy can be doing well but if the electronic company u invested has not adapted to the rapid changes in the industry, the company is dead and so are you.

Just my opinion...

To be honest, I was looking at this company too.

[VestedInterest]

this kind of business is like an import and exporter, somewhat perhaps similar to challenger. the management becomes very important i feel. if they fark it up could wipe out alot of the cash holdings.

In fact I did some comparisons with Challenger based on their current share price of 40 cents and the latest FY report. Challenger's PE is around 8.8 (EPS 4.53 cents), Div yield 5.5% (2.2/40), NAV btw 12- 13 cents. Numbers aren't too bad but used to be better some years back. Its gross margins are worse than BLT but net margins about the same. From the latest report, Challenger is facing some challenges- higher rentals and labour costs. The closure of 2 outlets will definitely impact on revenue this FY unless it is made up by opening of new outlets. Think will have to look at the next 1HY report to see how it will perform in the coming years.
Not sure if BLT supplies Challenger as well. If this is the case, then BLT's fate is somewhat tied to the fate of the former... though to a small extent.

[freedom]

I believe one very huge difference is that from 2008 - 2011, Challenger is expanding its revenue from 168,003 all the way to 316,864. for Ban leong, it is shrinking from 158,888 all the way to 109,692.

not really comparable.

[VestedInterest]

Crowds at the IT show. Think both companies will well!

[xierwang]

Ban Leong Technologies has reported earnings of $7.2 million for the FY2020/2021 ended March, 160.5% – or 2.6 times – higher than earnings of $2.8 million in the year before.
The higher earnings were attributable to higher revenue, gross profit, as well as other operating income during the year.

6.17 EPS and 2.5 dividends, seems they are doing very well during the pandemic period.