Friday, December 17, 2010

SuperGroup - Super Group initiated at Buy by UOB-KayHian, $1.66 target

Stock Name: SuperGroup
Company Name: SUPER GROUP LTD.
Research House: UOB KayHian


UOB KayHian starts Super Group (S10.SG) at Buy with a $1.66 target, based on a PEG valuation of 1.0x, “which we think is justified given its steady but solid growth outlook of 16% CAGR over the next three years.”



It says the company is “a leading instant food and beverage brand owner with a strong position in Southeast Asia. Super also owns more than 10 brands that are targeted at different consumer groups.”


The target implies a 2011F P/E of 16.4x, which is within its historical P/E trading range of 9.1x-17.7x since 2003. The house says the group has a top three market share (for the 3-in-1 coffee segment) in countries such as Singapore, Malaysia, Thailand and Myanmar.



“The group has a solid earnings track record, growing net profit at a 17% CAGR over the past five years.” Its shares are up 2.9% at $1.43.



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