Envictus International Holdings Ltd (formerly: Etika International Holdings Ltd)

[cyclone]

Etika International Holdings has recently changed its name to Envictus International Holdings.

The Group was principally a manufacturer and distributor of sweetened condensed milk and evaporated milk under the brand name of Dairy Champ.
Since the completion of disposal of dairies and packaging business and relevant intellectual property to Asahi Group Holdings' subsidiary, the company has sizable cash balance.

The group's operating divisions now are :
1. Trading & Frozen Food Division

2. Nutrition Division

3. Beverage Division
Etika Beverages Sdn Bhd is a manufacturer of canned beverages based in Seremban, Negeri Sembilan. Its plant produces both carbonated and non-carbonated drinks under the brand name of “Polygold”. In addition, it also produces “Air Champ” energy drink and “Power Champ” isotonic sports drink.

4. Noodles Division
PT. Sentrafood Indonusa’s manufacturing facility in Karawang, West Java manufactures and distributes its instant noodles under the trademark of Salam mie and is also an OEM Manufacturer for a few private label products (eg. Mie Sehati, Pandaroo and Myam).

5. Restaurant Division.
For Restaurant Division, on 10 July 2012, the Group signed an exclusive 10 year International Multiple Unit Franchise Agreement with US-based Cajun Global LLC for exclusive rights to develop and operate “Texas Chicken” restaurants in Malaysia and Brunei from 2013 to 2022. As at end of December 2013, the company has opened seventh "Texas Chicken" outlets.

The company is in trading halt now. Probably it will acquire a new business ?

<vested>

[desmondxyz]

30 cts cash distribution......what's next?

[cyclone]

Assume 1 SGD = 2.55 RM.

As at 30/06/2014 :
NAV per share = 1.4189 RM = 0.55 SGD

As at today :
Market price = 0.45 SGD
P/B = 0.818

Ex distribution of 0.3 SGD :
NAV = 0.25 SGD
Assume price is 0.15 or 0.14
P/B = 0.6 or 0.56

So we should sit tight and take the dividend. Isn't it ?
Moreover, for controlling shareholders that are willing to share the fortune of the company, I usually will not sell except the price is dear.

Highlights in Q3FY2014 results :
1. Firmly focused on enhancement of growth of remaining businesses in the Trading and Frozen Food, Nutrition and Others Divisions
o Further increase visibility of strong brand name – “Pok Brothers” – in supermarket and hypermarket chains across the country
o New product launches with new bar and powder based products currently under development by Nutrition Division
o Growth of “Texas Chicken” outlets to 12, with another three within next five months (Comment : For business that can multiply quickly, it is not supposed to be sold below book value ?)
o Initial stages of introduction of 325ml PET bottle carbonated drink produced in June 2014 by beverages business

2. Net cash position, with healthy cash and bank balances of approximately RM773.0 million that can be utilised for business expansion through potential acquisitions, joint ventures and collaborations and distribution to shareholders (Comment : More dividends to come ?)

3. Proposes a tax-exempt special interim dividend of SGD0.30 (RM0.77) per share
Ex date : 12 Agustus 2014
Book Closure date : 14 Agustus 2014
Payable date : 26 Agustus 2014

Outlook :
Barring unforeseen circumstances, the Group remains cautiously optimistic on its prospects. It continues to take active steps to further shore up its fundamentals and grow its businesses to derive greater value for shareholders.


<not a call to buy or sell, there may be flaw in the thinking>

[Louhan]

Very generous dividend of 30 cents. I think we should thank Mr Sam Goi who is in the Board of Directors.

[yawnyawn]

Thanks for highlighting. I took a quick look at the recent quarterly report.

Company is making an operating loss for this quarter and YTD if one-off items are excluded. They have disposed their profitable dairy business which generated roughly S$11m p.a. and decide to focus on the frozen food segment and expansion of Texas Chicken in Malaysia and Brunei.

However, given the high NTA~S$0.53 and company is in net cash of around S$0.40, i am taking a medium term view with this company and grabbed some shares this morning.

[Hill]

Hi bros

Does it mean after the XD, the share price will drop to $0.15?

[yawnyawn]

Hi bros

Does it mean after the XD, the share price will drop to $0.15?

Theoretically, price after XD should drop by $0.30. But we all know how irrational Mr Market can be. I think the most important thing for investors is to evaluate the remaining businesses of Envictus(frozen food, texas chicken in Msia and Brunei, nutrition) going forward.

[Louhan]

Hi bros

Does it mean after the XD, the share price will drop to $0.15?

Theoretically, price after XD should drop by $0.30. But we all know how irrational Mr Market can be. I think the most important thing for investors is to evaluate the remaining businesses of Envictus(frozen food, texas chicken in Msia and Brunei, nutrition) going forward.

The remaining businesses of Envictus are definitely worth more than 15 cents per share, not forgetting the balance of cash holdings of Envictus after paying the dividends. Therefore, at the current price of 45 cents, it's very undervalued.

[yawnyawn]

Hi bros

Does it mean after the XD, the share price will drop to $0.15?

Theoretically, price after XD should drop by $0.30. But we all know how irrational Mr Market can be. I think the most important thing for investors is to evaluate the remaining businesses of Envictus(frozen food, texas chicken in Msia and Brunei, nutrition) going forward.

The remaining businesses of Envictus are definitely worth more than 15 cents per share, not forgetting the balance of cash holdings of Envictus after paying the dividends. Therefore, at the current price of 45 cents, it's very undervalued.

I doubt the remaining businesses is worth more than 15cents right now. NRA estimates the remaining businesses to be worth around 3cents.

[CityFarmer]

Very interesting counter, thanks to Cyclone to highlight it. It is worthy to spend some time on this counter...

Assume 1 SGD = 2.55 RM.

As at 30/06/2014 :
NAV per share = 1.4189 RM = 0.55 SGD

As at today :
Market price = 0.45 SGD
P/B = 0.818

Ex distribution of 0.3 SGD :
NAV = 0.25 SGD
Assume price is 0.15 or 0.14
P/B = 0.6 or 0.56

So we should sit tight and take the dividend. Isn't it ?
Moreover, for controlling shareholders that are willing to share the fortune of the company, I usually will not sell except the price is dear.

Highlights in Q3FY2014 results :
1. Firmly focused on enhancement of growth of remaining businesses in the Trading and Frozen Food, Nutrition and Others Divisions
o Further increase visibility of strong brand name – “Pok Brothers” – in supermarket and hypermarket chains across the country
o New product launches with new bar and powder based products currently under development by Nutrition Division
o Growth of “Texas Chicken” outlets to 12, with another three within next five months (Comment : For business that can multiply quickly, it is not supposed to be sold below book value ?)
o Initial stages of introduction of 325ml PET bottle carbonated drink produced in June 2014 by beverages business

2. Net cash position, with healthy cash and bank balances of approximately RM773.0 million that can be utilised for business expansion through potential acquisitions, joint ventures and collaborations and distribution to shareholders (Comment : More dividends to come ?)

3. Proposes a tax-exempt special interim dividend of SGD0.30 (RM0.77) per share
Ex date : 12 Agustus 2014
Book Closure date : 14 Agustus 2014
Payable date : 26 Agustus 2014

Outlook :
Barring unforeseen circumstances, the Group remains cautiously optimistic on its prospects. It continues to take active steps to further shore up its fundamentals and grow its businesses to derive greater value for shareholders.


<not a call to buy or sell, there may be flaw in the thinking>