The first time i heard this name Pelikan, i thought it is a local or Malaysia brand (same like when i heard "Bata"). After some study, i found that it is originally from German, and also an international brand which have market thier product in more than 50 countries. In Malaysia, Pelikan can be say as a baby brand. Pelikan is in the consumer industry which engages in the manufacture and distribution of writing instruments; art, painting, and hobby products; school and office stationery; and printer consumables. The company distributes its products through wholesalers, dealers, retailers, hypermarkets, schools, and specialized stores primarily in Germany, Switzerland, Italy, rest of Europe, and Latin America. Pelikan International is headquartered in Puchong, Malaysia.
Not so many people known about this brand, same like me in the past. Most of us only heard about buncho's, Faber Caster, Pilot, Parker, Stabilo & etc........
It is a strong company that have efficient management team. Pelikan is aggrassively enter the Asia market. The are on the road to take over more Asia manufacturer & distribution network.
1)The EPS as below
2005 RM0.215
2006 RM0.241
2007 RM0.289
Average EPS Growth Rate = 19%
2)The Dividend per share as below
2005 RM0.18
2006 RM0.15
2007 RM0.11
The % of Dividend payout rate (2/1)
2005 83.72%
2006 62.24%
2007 38.06%
Average ROE = 17%
Average PE (10years) = 8.44
From the above, we can know that the management started to reduce the dividend payout although the EPS is increasing. For me it is a good strategy to increase my investment return if the management can reserve the cash for better investment and generate more ruturn, rather than just pay us the dividend which have to deduct from the government tax.
If let's say the next 5 years, the comapny remain the same dividend payout rate as 2007 with average ROE of 17%, our expectation can be like below:
17% x 61.94% (100% - 38.06%) = 10.53%
It mean the reserve portion of cash after the deduction from dividend payout, can generate of 10.53% growth for Asset.
Let's culculate the future growth of the Net asset per share with the 10.53% growth rate
2007 1.7
2008 1.879
2009 2.077
2010 2.296
2011 2.54
2012 2.80
2013 3.09
2014 3.42
2015 3.78
2016 4.18
2017 4.62
The Intrinsic value = 4.62 x 0.17 x 8.44
= 6.63
with the current price of RM2.95, we are at more than 200% of margin of safety.
Extra Information:
If you check the shareholding changes, you would found that Pelikan has just get a new giant investor (Hayman Capital Master Fund LP-the most successful fund in last year which gain a lot of money in the US Crisis). Other than that, the other shareholders & diretor of the company like the Goldman Sachs, Mr Loo are increasing thier shares in Pelikan. Do we can expect the future of Pelikan from here? Please think about it.
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24 comments:
what happen to the drastic drop of pelikan on last year, is it because of share split ( from rm 5 to rm 2.9 now)
Thanks for the sharing!
Dear anonymous,
Mind to share more if you do study on this stock. Thanks!
I think Pelikan is good growth stock and should deserve re-rating as this is company with financial sound and active strategy to gain global market share. Current share price trading at cum final dividend of 6 sen. However, Pelikan share is relatively iliquid and should progressive accumulate for medium to long term investment period.
mr loo hooi keat is a very shrewd businessman.
he is also the man behind logistic and transhipment companies (ilb+konsort) to move these products -see the synergy?
Debt Equity Ratio 2.18! High!
Thanks to hng, anonymous & vince38 reply.
Dear Vince38,
Pelikan high D/E ratio is due to its quick expansion. If you check the increase of sales & profit compare to the increment of the debt, you will find it is reasonable.
I have went through the report & study again.
I found that Pelikan hold a stake in Swiss listed subsidiary, Pelikan Holding AG. After some culculation, i found that it worth a market value of RM2.89-2.99 per share, based on its recent share price.
In my opinion, Pelikan's value is more than it's current market price.
Good Investing!
hook said:
Pelikan, a Malaysia-based stationery company, may be taken private by private equity firm Texas Pacific Group (TPG), said senior vice president of corporate planning Ng Cheong Seng.
”We’re talking to TPG right now. Nothing is confirmed as we’re exploring ways to structure the privatisation. We’re not desperately looking for a buyer, we’re committed to grow the business more,” he said. The take-private would be for MYR 1bn (USD 305m) -- a multiple of price-to-earnings of 8x to 9x -- and would be undertaken by TPG and other suitable investors. ”For investors who want short-term gains, sorry, we’re not interested,” said Ng.
Pelikan, a Malaysia-based stationery company, may be taken private by private equity firm Texas Pacific Group (TPG), said senior vice president of corporate planning Ng Cheong Seng.
”We’re talking to TPG right now. Nothing is confirmed as we’re exploring ways to structure the privatisation. We’re not desperately looking for a buyer, we’re committed to grow the business more,” he said. The take-private would be for MYR 1bn (USD 305m) -- a multiple of price-to-earnings of 8x to 9x -- and would be undertaken by TPG and other suitable investors. ”For investors who want short-term gains, sorry, we’re not interested,” said Ng.
TPG declined to comment.
The plan, first explored in 2005, is fluid and has no deadline for completion, Ng said. It would allow the company the flexibility to focus on long-term goals, rather than managing quarter-to-quarter earnings expectations, he explained. For instance, it would allow Pelikan to leverage TPG’s network to grow its markets organically and through mergers and acquisitions in North America and Europe.
Indeed, Pelikan is already speaking with targets in China, Germany and Canada, Ng said, and privatization would help pave the way for Pelikan’s ambitious acquisition plans.
In Asia, the company is planning to set up a listed special purpose acquisition vehicle (SPAC) in Hong Kong to acquire Chinese stationery companies at a cost of up to MYR 300m (USD 93.13m) each, this news service has previously reported.
On the German front, Ng said Pelikan was currently in talks to buy writing instrument companies Montblanc and Faber Castell. Luxury pen maker Montblanc is owned by Swiss luxury goods maker Richemont. ”Pelikan could potentially move into the area of luxury branding, which would need investments, spin-off the luxury division or refocus on the luxury brand,” Ng noted, adding that if Pelikan acquired Montblanc the aim would be to take the company public on the London stock exchange.
Regarding Faber Castell, Pelikan expects hurdles from Faber Castell shareholders. ”The company is owned by trust funds. It’s going to be difficult,” Ng explained.
European bankers, however, were sceptical that Montblanc would sell to Pelikan, and a spokesperson for Faber Castell denied it was in talks with Pelikan. While considerable speculation has surfaced since Richemont started restructuring its portfolio of assets, most of it tends to be ”wide of the mark,” one banker familiar with Richemont explained. A German-based banker also questioned whether this was the moment to make a play on Montblanc, given its good performance.
Neither Richemont nor Montblanc returned calls seeking comment.
Meanwhile, in North America, Ng said Pelikan had placed a bid this week to acquire the stationery division of a listed Canadian company. The division has USD 200m in revenues, he added, and the acquisition would give Pelikan a foothold in the US stationery market, especially in shelf space at retail outlets. ”We’re interested to buy but couldn’t put in a specific bid price because we didn’t have enough information on the asset’s value.” A SPAC would be created in North America to acquire the company, he added.
A North American industry banker and analyst were unaware of any potential deals in the works, but suggested listed OfficeMax’s stationary division Grand & Toy could be a match. ”Anyone who wants to get into the Canadian or US market will definitely benefit from acquiring Grand & Toy. They are probably the largest supplier in Canada,” the banker said. An industry analyst noted that OfficeMax itself had recently been named as a potential target in light of the sale of rival Corporate Express to Staples, and could look at divesting Grand & Toy as a way to make itself more attractive to potential acquirers.
Spokespeople for OfficeMax and Grand & Toy were not available for comment.
Pelikan has manufacturing hubs in Germany, Mexico, Malaysia, China, Scotland, Switzerland, Czech Republic and Bosnia. About 86.2% of its 2007 revenue came from the European market, 8.8% from Americas and the remaining 5% from Asia, Middle East and Africa, according to its annual report. Pelikan recorded revenues of MYR 1.19bn (USD 363.06m) in 2007. Net profit stood at MYR 96.17m (USD 29.4m).
Pelikan’s president and chief executive officer, Loo Hooi Keat, and other existing shareholders have no plans to dilute their shareholdings following the proposed privatisation, Pelikan’s Ng said. Loo has approximately 28% direct and indirect equity interest in Pelikan as of 15 April 2008. According to Pelikan’s 2007 annual report, other substantial shareholders include Arisaig Asean Fund (7.23%), Goldman Sachs International (9.28%), and Malaysia’s pilgrimage fund Lembaga Tabung Haji (8.85%). Pelikan has a 33% public spread.
Dear anonymous,
Thanks for your input. Pelikan is aggressively expand it's market share around the world by acquire other related business & enter into new market, especially asia market. Pelikan has done well in European market, Asia will be another potential market for them with the great experience in the European market.
But, besides focus on their quick expansion, Pelikan have to keep an eye on their company financial situation. Wish Pelikan a great future.
Good Investing!
hi jeff,
Is me hchhook. under name hook.
how u feel if privatised? bursa really need good company. other full of politic without solid result.
Dear hook,
In my opinion, the possibility for Pelikan's privatise is low in the current situation.
Pelikan strategies to enter & capture Asia market, need a lot of capital to support. Other than that the expansion with take over other potential companies, need them a lot of cash as well.
As a result, the reasons of privatisation still limited.
Cheers~~
dear jeff
so any TP for Pelikan ??
thanks and regards,
yew khian
Dear yk,
May i know what do u means TP?
Dear Jeff
I think what yk refer to is target price. Share price of Pelikan recently trading low in line with overall market sentiment. As pelikan percevied as growth stocks, current uncertain market will tend to discount its growth factor. Buy on weakness and staggering and prepare for long term holding while enjoying income from dividend. Share buyback and prudent capital management should provide price support
Dear hng,
Yes, i do agree with you idea. For a fundamental investor, bull market is an opportunity. Try to keep an eye for the undervalue stock & find the righm time to become a shareholder, but not now...... But to all of us, remember to do our homework before we choose a target.
Cheers~~
Pelikan recent quaterly report has came out. Try to check it out.
OOOoOoooOo..
all quite and dead~!
Pelikan went holland Jual Ikan
Dear Anonymous,
Try to think from another way. If the market not dead or quite, do u think there is an good entry point for the market? Patience is very important in the investment.
Good Investing!
Pelikan came to my attention in today news on acquisition of a Mexico company.
Share price of Pelikan seems on a constant down trend & now at 4years low.
Any major changes in the fundamental of the company? Appreciate if you can share. Thanks
Dear Remus,
Thanks for your interest on Pelikan. The company latest quarter financial report show a drop of net profit. The profit for 2008 financial ended show a drop of 50% compare to previous year. This is due to it's 80% of revenue streams are from Europe countries.
Just get known Pelikan Malaysia's Country Manager. In Malaysia, you can find Pelikan products in Parkson.
I do have complaint to him that the exposure of brand is low. But they are stating to increase their distribution channels now in Malaysia.
Pelikan are started focus on the Asia market. But for them, they are still new to Asia, except Japan. It is still long way to go for them.
Will keep track on Pelikan. The current price for Pelikan is very attractive. If you can foresee their future, you can consider it.
Hi guys,
just happen to come across your site on Pelikan...very helpful site! TQ all for sharing!
btw, where do we the small investors (especially newbie like me) get public listed companies' financial report?
is this site only talk about Pelikan?
Hi,
you may obtain all PLC financials from www.bursamalaysia.com.
regarding TP.. in fact there are a number of research houses cover this stock with thorough valuation. Research report would definitely give u a better idea/update on the current doing of the company as analysts have direct access to the management for their queries.
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