UMC 0256 UMEDIC GROUP BERHAD's earnings to grow more than 31pct in FY22, says HLIB
HLIB is projecting for UMC's earnings to grow by 31.7 per cent in the financial year 2022 (FY22), 41 per cent for FY23 and 18.1 per cent for FY24, far exceeding the 12.1 per cent compound annual growth rate (CAGR) projected by Protégé for the local medi
KUALA LUMPUR: Hong Leong Investment Bank (HLIB) Research has initiated coverage on UmediC Group Bhd (UMC), which is listed today at an initial public offering (IPO) price of 32 sen, with a "Buy" rating and target price (TP) of 61 sen.
HLIB is projecting for UMC's earnings to grow by 31.7 per cent in the financial year 2022 (FY22), 41 per cent for FY23 and 18.1 per cent for FY24.
This is far exceeding the 12.1 per cent compound annual growth rate (CAGR) projected by Protégé for the local medical device industry.
"This will be due to stronger revenue contributions from both segments, huge room for market share improvement as UMC accounts for a mere 0.2 per cent share of the total medical device industry in Malaysia and stronger contribution from its manufacturing segment that fetches higher margins.
"We value UMC based on a price-earnings (PE) multiple of 18x, in line with the peer average which consists of both local and international medical device manufacturers and distributors.
"While we acknowledge that UMC's market capitalisation is considerably smaller, we deem the valuation justifiable as we believe this is being compensated by the stronger earnings growth expected," it said in a note today.
HLIB said Protégé projected the medical device industry in Malaysia to grow at a five-year CAGR of 12.1 per cent, to a market size of RM21.41 billion by 2026.
"This will be supported by pent-up demand for healthcare services locally; as well as government shifting its focus to improving the country's public healthcare system post-pandemic.
"Increased demand for healthcare services would result in higher usage of medical consumables and also potentially speeding up the replacement cycle of medical equipment, both of which presents an opportunity to UMC," it said.
Meanwhile, HLIB said UMC was targeting to expand its manufacturing division by developing and commercialising more own-branded products, tapping on its research and development (R&D) capabilities.
As of current, it said UMC had identified several new products to be commercialised in the coming two years.
"These include sterile water for inhalation, pre-filled nebulisers, digital oxygen flowmeters and humidifier humidity sensors.
"At the same time, UMC is also looking to source more innovative medical devices from existing suppliers and principals, as well as developing a new brand distribution business.
"An extensive amount of time required to bring a product to the market and stringent selection process by the principals and suppliers would serve as a natural barrier to entry, in our opinion," it said.
https://www.nst.com.my/business/2022/07/816488/umedics-earnings-grow-more-31pct-fy22-says-hlib
Singapore Investment
-
-
-
-
-
-
-
-
-
-
How to we keep the dead alive?5 hours ago
-
-
-
-
-
-
-
-
The History of CapitaLand12 hours ago
-
-
CapitaLand Integrated Commercial Trust14 hours ago
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
CICT 1Q2024 Business Updates2 days ago
-
-
-
-
-
Keyboarding Warriors4 days ago
-
-
-
-
Cory Diary : Portfolio updates5 days ago
-
-
-
Weekly Markets Outlook5 days ago
-
-
Portfolio Update6 days ago
-
-
-
-
-
-
-
-
Buying a home for face1 week ago
-
-
-
-
-
Finance Investment Movement 441 week ago
-
-
Market indeed coming down1 week ago
-
-
-
-
-
-
Banks and Miles Report – Mar 20242 weeks ago
-
Revisiting Bitcoin2 weeks ago
-
-
-
2024 (Portfolio Update)3 weeks ago
-
-
-
Retirement Journey Update for March 20243 weeks ago
-
-
-
1Q 2024 Investment Strategy Update3 weeks ago
-
-
Portfolio Summary for March 20243 weeks ago
-
-
-
Portfolio (March 30, 2024)4 weeks ago
-
-
-
QAF #77 - 2023 Annual Report4 weeks ago
-
Lentor Hills Residences4 weeks ago
-
Burnt out!4 weeks ago
-
-
-
Feb 2024 Expenditure4 weeks ago
-
-
Starting Our Second Property Cycle5 weeks ago
-
-
-
-
-
-
-
Feb 2024 Portfolio1 month ago
-
-
Summary of February 20241 month ago
-
The Market Is A Scam!1 month ago
-
-
-
-
-
-
-
-
-
Options Trading Journal Jan 20242 months ago
-
-
-
-
-
-
-
End of 2023 Review3 months ago
-
-
Year 2023 DIYQuant Portfolio Performance Report3 months ago
-
Monthly Summary of November 20234 months ago
-
3 Simple Poker Strategies for Beginners4 months ago
-
Migration of website5 months ago
-
-
Abandon REITS?5 months ago
-
-
-
-
-
-
-
-
-
August 2023 Portfolio Updates7 months ago
-
-
-
-
Hello SP Group, I'm Back!9 months ago
-
-
-
-
A New Light11 months ago
-
-
-
-
-
-
-
Demoralized1 year ago
-
2022 Thoughts, Hello 2023!1 year ago
-
Series of Defaults for Maple Finance1 year ago
-
Takeaways from “Sea Change”1 year ago
-
-
Greed is Coming Back1 year ago
-
-
-
-
-
-
-
-
-
-
-
What is Overemployment1 year ago
-
-
-
-
-
-
-
-
-
-
-