I don't think it will drop until 0.5 in the short term since the business keeps expanding and revenue of business shows increasing as well, which is a good sign. To be honest, I would average down as long as the business revenue shows increasing or maintained at the level. Plus the dividend yield given 4%, and the past history shows bonus issues declared every 2 years in these years which is quite attractive at the current price level. Of course, no buy sell recommend ahh.

Solid despite cautious consumer sentiment. Notwithstanding the soft retail environment, management sees positive growth momentum for its optical business (81% of FY23 sales) so far in FY24F. This is likely fuelled by the robust demand for eyewear products on rising myopic population. In addition, the strategy to target higher-income consumer groups is also key to the resiliency, with the said groups making up c.80% of its customers. Meanwhile, we gather that the tourist-driven outlet cluster eg KLCC and Pavilion, are seeing overwhelming footfalls whilst the opening of a Focus Point Signature outlet in The Exchange TRX in Nov 2023 is also timely to capitalise on the recovery in tourist arrivals. Management also shared that Johor (second-largest state by outlets) continues to see strong sales traction.

F&B business on the right track. To recap, FPHB staged an earnings turnaround in its F&B segment (16% of FY23 sales) in 4Q23 after successfully resolving the issue of over-manpower in its central kitchens. Hence, we expect the profitability to sustain going forward considering the stable volumes of its existing corporate customers and in-house Komugi outlets. It targets to add at least two Komugi stores in FY24F to the current total of 12 stores. The additions, together with the ramp-up in volumes by newer corporate customers, including ZUS Coffee and Cotti Coffee (refer Page 4 for more information) should drive topline growth in the F&B business (our FY24 forecast: 13%). It also launched the Hap&Pi frozen yogurt brand (refer Page 3 for our ground check), with the first kiosk outlet opening in March.