Singmedical (18 Apr 2021) - 0.345

 Financial highlight

Year 2020 definitely not a good year for SMG. With the pandemic and circuit breaker from 7 April 2020 to 19 June 2020, non-essential business must close down. Revenue and profit will definitely impacted , moreover some of the business for SMG is dependent on overseas patients, contribution of foreign patients is about 15 to 20 percent for group revenue. With all the restriction, overseas patient unable to come in to SG. 

Support by government and rental is about 4.1million else the net profit will drop 64percent compared to 2019.

Paediatrics - 7 clinics

Astra Women’s Health - 12 clinics

Cardiac Centre - 1 clinic

Diabetes & Thyroid - 2 clinics

Lifescan Imaging - 2 clinics

Lifescan Medical center - 2 clinics

Lasik - 1 clinic

Urology - 1 clinic

SW1 - 2 clinics

The breast - 1 clinic

Cancer - 1 clinic

Dental - 3 clinics

O&G - 2 clinics

Wellness and Gynaecology - 1 clinic

Financial Statement

Revenue dropped 8 percent and profit dropped 33%. In 2H 2020, business almost going back to normal. Other loss 3millions because impairment loss for Paediatrics Business Unit

2H 2020 - 48,395

1H 2020 - 38,945

2H 2019 - 50,029

1H 2019 - 44,643

The revenue heavily impacted in 1H 2020, else the business will revenue will remain the same. 

Balance Sheet

This is the mistake that i've made during my initial investment. Intangible assets is 65percents of Total assets, is very risky. Cash less 1.6million, and borrowing less 400k. 

Cash Flow

With the pandemic, company still able to generate positive cash flow, nothing to criticize. Company keeps paying off the loan, which is a good sign. 

My thought

Pandemic will be over one day, medical tourism will back to normal. Earning will back to normal as well. But be aware of the earning, for this type of company, they will only M&A to grow the company. 

This is the main risk which I didn't realize when I bought in 2017. 

GREATECH - (17 Apr 2021) - RM5.95 , FAIR PRICE - RM3.59

About

This company helping other companies to setup automation. 

Revenue

Total revenue for 2018 ,2019 and 2020is 219 millions, 215 millions and 261 millions. 

As we can see that the revenue is keep increasing. 

From the chart, clearly see that most of the revenue contribute from America follow by Asia and Europe. 

Balance Sheet

From the balance sheet, cash is increasing and the borrowing is reducing. Which it is a good thing for the company. Trade receivable is increasing but payable also increasing. Cash rich company. 

Revenue increased 20 percent despite the pandemic. Profit increased 35millions. 

Cash flow normal. 

My thought

With 5G trend, lot of companies will going into automation. This will benefit the company. 

But with the technology keep changing, company need to keep upgrading itself to stay competitive. 

Current price - 5.95

Earning - 0.1403

P/E - 42

ROE - 33 (3 year avg) 

CAGR EPS  from 2018 to 2020, 40 percent

This company in growing stage, no dividend was given. High growth company but is that sustainable?

For me, this company is overvalued.