The company and its subsidiaries are mainly engaged in the retailing of
garments industry basically they sell clothing. What comes to your mind when
you think of Padini clothing brand? Chiplak brand? Well actually people buy
clothes here not mainly because of the brand but it is because it’s “cheap” or
should I say affordable.
So with the price drop from a high of RM6.2 to a low RM3.6 is it affordable
now? Firstly we would like to dive deeper into the company.
Padini owns a wide list of companies, some of the companies they own are as
follows: Padini, Padini Authentics, SEED, P&Co, PDI, Miki, Brands Outlet, Vincci,
and Vincci Accessories, Brands outlet, etc.
5 Years CAGR Revenue = 17.99 % EPS = 18.31 % Net Income = 18.26 % Profit before tax = 17.51 % Operating Income = 17.26 % Having Revenue, Net income, EPS growing at a compounded rate of more than
15% every year looks like a great company altogether which they are moving
the company in the right direction. Their top line revenue have increased from
RM1.57 billion in 2017 to RM1.68 billion in 2018 whilst net profit also
increased.
Their growth in net profit is mainly contributed by the continuing top line
growth and better supply chain and product management whilst continuing to
offer better value for money products compared to their competitors.
As the Global growth is forecasted to be slightly weaker in 2019 compared to
2018 will also impact Padini which this year will be a challenging one for them.
The impact on consumer spending will very much depend on the Government’s
control the budget deficit versus the aim to put more disposable income into
the hands of the rakyat in the face of global uncertainties.
However retail industry in Malaysia will continue to maintain its momentum in
growing at this rate in the mid to longer term. Things that drives their growth
is that affordable fashionable clothes are becoming more and more popular
nowadays, rising population, rising disposable income and others. Having a
good moat around affordable fashion clothing brings good revenue to the
company.
2018 will also impact Padini which this year will be a challenging one for them.
The impact on consumer spending will very much depend on the Government’s
control the budget deficit versus the aim to put more disposable income into
the hands of the rakyat in the face of global uncertainties.
However retail industry in Malaysia will continue to maintain its momentum in
growing at this rate in the mid to longer term. Things that drives their growth
is that affordable fashionable clothes are becoming more and more popular
nowadays, rising population, rising disposable income and others. Having a
good moat around affordable fashion clothing brings good revenue to the
company.
Padini also has an online store (https://www.padini.com/), this online store
helps keep the company in check with the latest trend now which is online
shopping. Their gross profit margin also increased by 2% in the current year
which now the company is getting around 40% gross profit margin and also
around 9% net profit margin which is not bad already for their affordable
fashion clothing lineup.
They also have a few stores overseas but main part of their revenue comes
from Malaysia alone accounted for about 96.5% of the group’s consolidated
revenue for 2018. In Malaysia the group has at 30 June 2018, a total of 143
retail stores divided into 41 single-brand stores, 48 Padini Concept Stores and
54 Brands Outlet stores.
For those who wants to see a part 2 if we can get more than 50 likes I will be
doing a part 2.
In our part 2 we will be covering the financials of this company which includes
the health of the 3 financial statements and also our opinion and what we think
of the company in the years to come.
———— Check us out ————
WEBSITE • @12ingroup
FACEBOOK • 12Invest
INSTAGRAM • @12ingroup
TWITTER • @12_invest
#PADINI
#CLOTHES
#FASHION
#12INVEST
Disclaimer:
All the views and opinions expressed in our post are for education and informational purposes only and it should not be considered as professional financial investment advice or buy/sell recommendations. We strongly encourage you to do your own research and take independent financial advice from a professional before you proceed to invest.
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