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https://kongsenger.blogspot.com/2020/04/5277-fpgroup-60.html?m=0

On Friday, Foundpac Group Bhd (FPGROUP:KLS) closed at 0.695, -31.19% below its 52-week high of 1.01, set on Feb 19, 2020.

Kajian Saham Picisan

On Thursday, Foundpac Group Bhd (FPGROUP:KLS) closed at 0.66, -34.65% below its 52-week high of 1.01, set on Feb 19, 2020.

Kajian Saham Picisan

On Friday, Foundpac Group Bhd (FPGROUP:KLS) closed at 0.67, -33.66% below its 52-week high of 1.01, set on Feb 19, 2020.

Kajian Saham Picisan

On Monday, Foundpac Group Bhd (FPGROUP:KLS) closed at 1.02, -17.07% below its 52-week high of 1.23, set on Jul 23, 2020. weekly chart

Kajian Saham Picisan

You would think that with the popularity of online businesses, logistics companies would be having a roaring time.

When I looked at the performance of CJ Century, I found that its share price had been trending down since peaking in mid-2022. When I looked at its ROE, I also found that it had declined from its 2014 peak.

CJ Century is focussed on its legacy logistics businesses – total logistics and procurement logistics. The EBIT margins for these 2 businesses have been declining since 2015. The Group needs to improve its operations to arrest the decline. However, it does not have a clear track record of delivering operating improvements.

To deliver a sufficient same margin of safety from the Earnings Value, CJ Century needs to achieve 11% better performance than its past 2 years average. Can it deliver this with just the legacy businesses?

CJ Century ventured into the couriers services sector in 2016 but have since divested this loss making venture. You wonder why it did not tap big into serving the growing online fulfillments services.

FoundPac – will its share price trend the Notion way?

FoundPac is a precision engineering company. It is in the same sector as Notion. While Notion share price has seen a quantum leap since May of this year, there is no such jump for FoundPac

While FoundPac had been able to deliver revenue growth over the past 9 years, profits were declining. This was because revenue came from the Group venturing into new product segments that did not have good margins.

But its precision engineering business has delivered good returns. But the newer segments such as cables and connectors and even automation are not pulling their weights.

Notion share price uptrended because of the ramp up its precision engineering business. Is FoundPac going to have the same business benefit in the coming few months?