Stock With Momentum: Jerasia Capital

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JERASIA CAPITAL BHD (-ve)

Jerasia (Fundamental: 0.35/3, Valuation: 1.7/3) saw a sharp surge in investor interest last Friday, gaining 15.6% to 52 sen. This comes after the company announced strong FYMarch2015 results on Thursday. Yesterday, it closed at 55.5 sen. 

Jerasia is mainly involved in contract manufacturing of fashion apparels for exports and retail for fashion garments and accessories. Retail brands include MNG Mango and Nike. 

The company’s revenue and profit grew from FY2010 to FY2013. However revenue declined marginally to RM320.9 million in FY2014 while net profit fell 53.1% to RM3.3 million due to its dissociation with Calvin Klein Jeans and an increase in expenses from new shop openings, refurbishments and the launch of a new brand.

For FY2015, net profit tripled on a 4.5% increase in revenue, thanks to accelerated spending before the implementation of the Goods and Services Tax (GST) in April and unrealised forex gains.

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This article first appeared in The Edge Financial Daily, on June 2, 2015.