Monthly Research : Formosa Prosonic Industries Bhd (FPI)


SWOT Analysis

Strength

  1. Company has disposed loss making subsidiaries / associates and consolidated its operations in Malaysia over the years.
  2. Ventured into musical instruments industry through acquisition of a subsidiary
  3. Strong balance sheet, net cash, debt free over the past 5 years
  4. Consistent dividend payout with ~11% CAGR over the past 5 years

Weakness

  1. Unclear business model due to vast changes in corporate structure
  2. Company brand itself as audio equipment / system manufacturer, however, we found out that its subsidiary that manufactures audio product has became inactive.
  3. Large amount of other incomes portion presented in the report left unexplained.
  4. With exclusion of other incomes, company does not show good profitability.
  5. Inconsistent cash flow from operations

Opportunities

  1. Valuation by DDM has ~28% margin of safety (Undervalued) – not a strong reason to buy

Threats

Unknown


References

http://www.sinchew.com.my/node/1813305/净利出色.产能增加.台湾联友财测调高

Appendix

FPI Key Fundamental Metrics


FPI main revenue contributors (Highlighted)


FPI subsidiaries contributions


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