Stock With Momentum: Kim Hin Industry

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This article first appeared in The Edge Financial Daily, on November 27, 2015.


Kim Hin Industry Bhd (-ve)

SHARES of cash-rich Kim Hin (Fundamental: 2.5/3; Valuation: 2.6/3) triggered our momentum algorithm for the third time over the last four days. The stock rose 0.8% to close at RM2.40 yesterday after announcing solid 3Q2015 results.

For 3Q2015, revenue rose 18.4% y-y to RM91.8 million while net profit surged more than 14-fold to RM9.5 million. The strong profit growth was primarily due to higher sales and RM4 million in unrealised foreign exchange gains.

Kim Hin is one of Malaysia’s largest ceramic tile manufacturers, with three manufacturing facilities in Malaysia and China. Its products are marketed under the brands of ‘Kimgres’, ‘Vitrogres’ and ‘Durogres’. 

In addition, Kim Hin also has an exclusive, royalty-free license to use the ‘Johnson Tiles’ trademark in a number of countries, including Australia, Indonesia and Thailand, for 50 years. Recall that Kim Hin got the license after acquiring Norcros Industry Pty Ltd in 2014 for about RM6.9 million.