Wellcall Holdings Bhd (-ve)
WELLCALL (Fundamental: 3/3, Valuation: 2.1/3), one of InsiderAsia's Top 10 picks for 2015, has performed strongly, up 34% to RM2.01 year-to-date. The Ipoh-based industrial rubber hose maker is benefiting from the strengthening USD - it exports over 90% of its products.
For 1HFYSep15, net profit jumped 40% y-o-y to RM19.9 million, partly due to a 23% growth in export sales. Net margin expanded by 3.7 percentage points to 24%, boosted by higher utilisation rate, forex gains and lower rubber costs.
Although valuation is not cheap at a trailing 12-month P/E of 18.6 times, Wellcall offers good long-term growth and an attractive dividend yield of 4.2%.
For FY2010-FY2014, dividend per share grew from 4.4 sen to 8.3 sen (adjusted for a 5-for-2 share split), in tandem with a two-fold increase in earnings. Its third factory, slated to commence production in July/August, should increase its total installed capacity by 70% and drive future growth.