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TP Rm2.5
The current FCPO just stood at Rm5,100, a price level of early 2022. The price rally similar to 2020 to 2022 previously seems to be repeating. The market cap would be 6307m based on average PAT for 2021 and 2022, with undemanding 15x PE. The upside potential is 100% based on the current market cap of 3150m (1.26/share).
JPG’s profits after tax were 345m (2021) and 496m (2022) respectively.
While the company has bad quarterly accounting which lead the much profit fluctuation, the annual profit trend is clear:- the company has started profit making since 2022.
Handsome profits continue thereafter and will expect such trend in years to come, especially with new won mega projects, including those from MP Ampang Jaya.
Under the NIISE won scenario, the total profit could yield at least Rm100m. How would this compare to the recent annual profit of only <Rm10m?
The case is clear, existing growth without NIISE: Rm3.5 (50x PE multiple of FY24 profit), with NIISE: Rm6.
Is Well Chip’s lowest valuation among the 3 listed pawnshop group justifiable?
Well Chip traded at TTM PE 21x, while PPJACK (the first listed pawnshop group) and EMCC are traded at TTM PE 36x and 27x respectively.
Given that Well Chips is the largest pawnshop group by profit and market cap, could a higher valuation, say PE of 36x (Rm3.0) or 27x (Rm2.5) justifiable?
