Keeping Track

This article first appeared in Personal Wealth, The Edge Malaysia Weekly, on June 15, 2020 - June 21, 2020.
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Zhulian Corp Bhd

Zhulian Corp Bhd is an investment holding company whose principal business is the manufacturing and distribution of products sold through multilevel marketing channels.

For its first quarter ended Feb 29, the group recorded revenue of RM44.8 million, up 14% from the previous corresponding period. It recorded a profit before tax of RM14.1 million, an increase of RM0.7 million, or 5%, from the previous corresponding period. The increase was mainly attributable to higher export sales.

The group’s business is closely linked to the general consumer market sentiment as well as fluctuating foreign currency exchange as all export revenue is transacted in US dollars.

Moving forward, the group will adapt to changing market demands where possible while remaining cautious over potential risks — such as the Covid-19 pandemic — to ensure its long-term survival. The group is committed to continuously improving its operational efficiency and maintaining sufficient cash flow this year.

According to Bloomberg data, the stock is trading at a price-earnings ratio (PER) of 11.13 times. It closed at RM1.20 on June 10, giving the company a market capitalisation of RM552 million, according to Bloomberg.

British American Tobacco Malaysia Bhd

British American Tobacco Malaysia Bhd is involved in the import and sale of cigarettes. 

For its first quarter ended March 31, the group recorded revenue of RM481.1 million, a decline of 22.5% compared with the previous corresponding quarter. It recorded a profit before tax of RM66.9 million, a decrease of RM49.7 million, or 42.6%, from RM116.6 million in the previous corresponding period.

The decline is attributed to a contraction in the legal market as a result of illicit cigarette volume and illicit nicotine vaping growth, market down-trading and lower duty-free sales as a consequence of the regional and international travel restrictions caused by the Covid-19 outbreak and the ensuing Movement Control Order.

The group has resumed operations strictly following the prescribed government procedures. Its growth strategy will be very much dependent on the recovery of the legal cigarette market, a regulated nicotine landscape, sensible fiscal policies and a resolution to the affordability issues affecting consumers.

According to Bloomberg data, the stock is trading at a PER of 10.41 times. It closed at RM11.22 on June 10, giving the company a market capitalisation of RM3.2 billion.