OVERVIEW:
The Group is a leading integrated private healthcare provider in Asia, operating medical facilities in 13 cities in SG, China, Japan, Vietnam and Cambodia. From primary care at its network of Raffles Medical clinics to specialist and tertiary care at Raffles Hospital, the Group prides itself on offering a seamless continuum of care to all its patients.
HIGHLIGHTS:
[1] Latest results saw 1H2017 revenue hit 235m and net profit 31m, both are flat year on year.
[2] RafflesMedical continued to expand its network of clinics in SG. While 3 clinics are undergoing relocation and refurbishment, 5 are going to reopen by 3Q2017 with 1 new opening in Hillion Mall. RafflesHospital's Emergency Care Collaboration with Ministry of Health was extended for another 5 years. New RafflesHospital Extension will open in 4Q2017.
[3] Cash and cash equivalent registered at $112m. After deducting borrowing, it is in net cash position of $60m.
INVESTMENT THEMES:
[1] 1H Earning per shares - 0.0185 || Dividend ~ 0.02
Last trading price, 1.1 translates to PE ~ 30 and dividend yield ~ 2%, which is in average valuation among its peers in the region.
[2] In China, 700-bed Raffles Hospital Chongqing and 400-bed RafflesHospital Shanghai are targeted to be operational by 2H2018 and 2H2019 respectively. The Group has a clear growth plan out of domestic market.
PRICE TREND:
The counter has been facing headwind since end of July. Downfall near to 20% in the period. Strong buying volume appeared on mid Sep. Its major shareholder, Standard Life Aberdeen plc raised its stakes to > 6% on 8 Sep as highlighted below. Downtrend could have paused, with support ~ 1.04. Resistance ~ 1.16. Chances for accumulation might be now.
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