Yee Lee Corporation Bhd (-ve)

SHARE price of Yee Lee (Fundamental: 1.0/3, Valuation: 1.2/3) jumped 26.4% year-to-date, despite the termination of distribution agreement with Red Bull Asia FZE, effective April 30, 2015, and lower expected profit from its 32.9%-owned associate, Spritzer Bhd. 

Established since 1968, Yee Lee has grown into a fully integrated manufacturer and distributor of fast moving consumer goods such as cooking oils (famed for its Helang and Vesawit brands) and household products. It also manufactures corrugated cartons and aerosol cans.

Yee Lee has done quite well. Between 2011 and 2013, net profit margin increased from 2.5% to 5.1% while ROE rose from 7.4% to 10.9%. Net gearing stood at 22.9% at end-Sept 2014, down from 49.6% in 2011. However, for 9M2014, pre-tax profit fell 10.2% to RM28.8 million despite 6.8% sales growth. 

The stock is trading at a trailing 12-month P/E of 9.8 times and 0.87 times book. Dividend yield was low, at only 1.8%.

This article first appeared in The Edge Financial Daily, on February 13, 2015.