Bonia Corporation Berhad (Bonia - 9288) is better known for it's high end apparel designing, manufacturing and retailing business.
From a range of leather wear, footwear and apparels, the groups also own SEMBONIA and Carlo Rino, whilst holding license to distribute international labels such as Santa Barbara Polo & Racquet Club, Austin Reed, Valentino Rudy, Jeep, Braun Buffel, Pierre Cardin, Bruno Magli, Enrico Coveri and Renoma.
The implementation of the GST in April 2015 had definitely bring certain drawbacks towards the retailing industry. Bonia had been deriving more than 60% of revenue from within Malaysia. However, as the retail environment continue to be tougher, what are the direction that the management of Bonia can implement in order to continue enhancing shareholder return?
Grabbing On Emerging Opportunity
Bonia's primary target market is middle to high class working individuals. While Malaysia is a good country to see such target market, it is imperative for Bonia to penetrate to new emerging market in order to see the continuation of growth in the company.
The
best destination to explore will be the rising up South East Asian
countries, namely Vietnam and Myammar which had been seeing influx of
foreign investment towards both the nation. The latest major political
change in Myammar had also open up ample of opportunity for more foreign
investment to pour into the emerging nation.According to the director's of Bonia, the group will be looking to see more bring more outlet to cater towards the demand for high range apparel in the growing emerging market.
Till date, Bonia had 2 outlet in Myammar, 4 in Vietnam and 1 in Cambodia.
El-Nino - Of Destruction and Opportunity
It is imperative to know that El-Nino had started to take it's effect into the global climate situation. The "East Asia Cold Snap", caused sudden drop of temperature in the southern and south-eastern part of China as well as Taiwan and Hong Kong, had took many individuals unprepared for the extreme weather.
In
January 2016, both Taiwan and Hong Kong had recorded their coldest
temperature in 60 years history. The Cold Wave from China is traveling
south bound, hitting country such as Vietnam and Thailand. On 26th
January 2016, Chiang Rai recorded a 8.6 degree Celsius after day break.Leather wear will be the preference wear during a cold/snow environment. For this cause, it had opened up massive opportunity for Bonia to see it's product snapped up in the affected countries, especially Taiwan. The cold season will also push consumer in purchasing more quality wearable to keep themselves warm.
Companies which are involves in apparel manufacturing, trading and retailing had also seen great interest in the recent days despite the headwinds from equity market, marking a strong demand from this opportunity that had been created by El-Nino.
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Back to Bonia, we can see that Bonia had broken away from the continuous down trend line started since April 2015. The share price had normalized and consolidated in a well manner at the range of RM 0.70.
Apart from the consolidation, Mr Chiang Sam Seng had increased in direct holdings by more than 3 million shares to the current 4.1 million direct holding from the open market, with an average price at approx RM 0.80. The latest buy back is seen at the price range of RM 0.67.
Interestingly, the share had also on 2 occasion saw solid accumulation of the share in the end of September 2015, with more than 12 million shares transacted on a solid white candle, as well as the recent 7 million shares transacted on a bullish candle in the middle of January 2016.
Bonia will be a good lookout for the current theme, considering that it had not make a break out run for the time yet. Breaking out RM 0.75 in a convincing manner will see Bonia putting a challenge at RM 0.80 easily.
BONIA (9288) - Bonia - Leather Weapon
http://bonescythe.blogspot.my/2016/01/bonia-leather-weapon.html
BONIA, BONIA (9288), 9288, EN9288, KLSE:BONIA, Investing, Bonescythe Stock Watch
