Superior Multi-Packaging

[dydx]

I was impressed by the significant improvement in profit margins when I reviewed SMP's recently released FY10 (ended 31Dec10) results.....
http://info.sgx.com/webcoranncatth.nsf/V...500541966/$file/SMPLFY10Result.pdf?openelement [FY10 results announcement]
http://info.sgx.com/webcoranncatth.nsf/V...500541966/$file/SMPLPR.pdf?openelement [Press release]

The increases at GP, PBT, and NP levels were all much faster than revenue increase. This is the same for aftertax FCF (before capex for business expansion) as well.

Growth of SMP's metal containers (cans, pails and drums mainly used for paints and chemicals) business in PRC seems to be catching strong traction, and the planned expansion in India is also promising.

B/S as at 31Dec10 is strong enough, after a 1-for-1 rights issue in Aug10 which raised $10.0m mainly to fund capex for business expansion.

An unchanged $0.003/share Final dividend declared.

Just based on the per share NAV of $0.2254 as at 31Dec10, SMP's last done share price at $0.09 appears to be a grossly under-priced situation for a well-established and growing regional business that is poised to deliver even higher profits in the medium-term.

[corydorus]

Yes. This one is good. And is a true singapore company. We need more such emerging companies listed in SGX not S-Chips.

(Vested)

[FFNow]

Who are its clients?

[corydorus]

Singapore CEO, CFO ...

Major shareholder is Wuthelam Holding. When i search website saw below. I am no expert so do your own investigation.

*1 Wuthelam Holdings Pte Ltd
Headquartered in Singapore, Wuthelam Holdings Pte Ltd is a corporate group specializing in the manufacture and sale of paints and coatings. During fiscal 2002, the group's consolidated net sales amounted to approximately 90 billion yen. Since the 1960s, Wuthelam Holdings Pte Ltd has been a joint venture partner for coatings business in Asian countries.

*2 NIPSEA corporate group
A joint-venture corporate group established by Nippon Paint in cooperation with Wuthelam Holdings Pte Ltd, NIPSEA is engaged in a comprehensive paint and coatings business for construction, automobile and industrial applications. This corporate group is comprised of 15 companies (19 plants) located in Singapore, Malaysia (2 companies), Thailand, China (5 companies), Vietnam, the Philippines, Taiwan, Hong Kong, Korea and Indonesia (technological collaboration).

[dydx]

The Nippon Paint / Nipsea Group (controlled by Wuthelam Holding / Goh Cheng Liang family) is a major anchor and regional customer of SMP Group for metal containers (cans, pails and drums) used to distribute the famous "Nippon Paint" range of paints and coatings. As an expert producer of such metal containers, SMP also supplies to other leading MNC paint manufacturers (like ICI, Hempel's, Berger, etc.) active in the Asia region, as well as local manufacturers in the countries where SMP has production facilities.

The good thing is that metal containers remain the best and also a cost-effective packaging solution for paints and solvents, and demand for paints continues to grow steadily in Asia. As the metal containers are not re-cycled, and as Nippon Paint or ICI sells more paints, more metal containers will be needed from SMP and other suppliers.

[dydx]

This morning (25Mar11), there is again enthusiastic buying which, based on the price/volume chart, appeared to have started since 9Mar11.

At the current price level of $0.105 - $0.11, SupPack's share price has finally recovered to the pre-rights issue (1-for-1 at $0.055 per new rights share) high of $0.11 level in May10. So in effect, SupPack's market cap. has nearly doubled up from the pre-rights issue level, to the current $38.19m (based on the 363.756m issued shares outstanding as at 31Dec10, and the last done share price of $0.105). Considering a portion of the market cap. increase should accrue to the new capital raised (approx. $10.0m) in the rights issue, Mr Market has so far rewarded SupPack an approx. 31% increase in real, incremental market valuation since mid-May10.

Indeed, the rights issue has proven to benefit SupPack's business expansion and market cap.

[FFNow]

There's a write-up on SMP in this week's The Edge.

[corydorus]

Anywhere i can find this article ?

(I am still Vested)


Cory

[cif5000]

They said another rights issue. Hopefully that will come real soon...

---

They said another rights issue. Hopefully that will come real soon...

Here's the last paragraph:

That was Superior Multi-Packag-
ing’s first capital raising since listing
and both Wang and his chief financial
officer Chris San think it could be time
for another round. Wang has spent
time “getting the house in order”, as
he calls it, and has the results to show
for it. Now, he just needs investors to
see the company’s real value, and sup-
port its next phase of growth.

[dydx]

2 rights issues within a period of 12 months or less!? Doesn't sound too rational to me!

If SupPack calls for another rights issue soon, I think its BOD/Executive Committee [headed by Prof Tan Chin Tiong (Chairman) with Assoc Prof Loh Han Tong (Member)] better have a very good growth story to back it up.

Apart from frequent capital raising exercises, too many shares (already SupPack has 383.756m outstanding issued shares) and too low a share price (SupPack's share price now $0.105, vs. NAV of $0.2254/share as at 31Dec10), do not make raising the market cap. of a mid-size company an easy task. I think it is better that SupPack pursues a steady growth strategy and focusses on raising its profitability further to a more respectable level. The 2 professors ought to know the right management theories; they just have to put them into good practice in SupPack!