Stock With Momentum: Kein Hing

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This article first appeared in The Edge Financial Daily, on October 16, 2015.


THINLY-TRADED Kein Hing (Fundamental: 0.85/3, Valuation: 2/3) jumped 10.6% to close at 52 sen yesterday, triggering our momentum algorithm for the first time. There were no new corporate developments.

Kein Hing is mainly involved in sheet metal forming, precision machining along with the manufacture and sale of gas appliances under the ‘Zenne’ brand name. This segment contributed 95.5% of the company’s revenue in FYApr2015 with the balance coming from the trading of electrical products and home appliances.

For 1QFY2016, revenue grew by 3.2% y-o-y to RM50 million while net profit jumped by 34.7% to RM2.1 million. The good performance was attributed to lower costs and better sales from the company’s Vietnam operations.

Kein Hing trades at a trailing P/E of 10.7 times and 0.5 times book. Net gearing stood at 27.7%. The stock’s first and final dividend of 1 sen is subject to approval at its AGM on October 29.