Stock With Momentum: KPS Consortium

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This article first appeared in The Edge Financial Daily, on January 14, 2016.


KPS Consortium Bhd (-ve)

Shares of KPS (Fundamental: 1/3, Valuation: 1.7/3) continued to rise yesterday, closing 6.2% up at a one-year high of 60 sen. Some 9.1 million shares changed hands despite the absence of new material announcements.

Selangor-based KPS is primarily engaged in the distribution of building materials and the conversion of paper into related products. The company also has interests in paper milling and trading of paper related products.

For 9M2015, revenue grew 12.4% y-o-y to RM382.6 million, while net profit was 251.8% higher at RM20.3 million. Excluding a RM13.6 million gain from the realisation of its non-current assets held for sales in 1Q2015, net profit would have grown by a smaller 14.9% y-o-y.

KPS’ founder and managing director, Koh Poh Seng, has been increasing his shareholdings through open market acquisition, to 44.9% in December from 44.0% in May 2015.

The stock trades at a trailing 12-month P/E of 6.1 times and 0.4 times book.