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  1. 1. IDLC Investments - Company Insight Singer Bangladesh Limited July 24, 2014 Terminologies Free Float : % of total shares not owned by Sponsors/ Directors, and Govt. Forward PE: Based on Annualized Earnings of the latest declared quarter Trailing PE: Based on Latest 12 Months Earnings Disclaimer:This Document has been prepared and issued by IDLC Investments Limited on the basis of the public information available in the market, internally developed data and other sources believed to be reliable. Whilst all reasonable care has been taken to ensure that the facts & information stated in the Document are accurate as on the date mentioned herein. Neither IDLC Investments Limited nor any of its director, shareholder, and member of the management or employee represents or warrants expressly or impliedly that the information or data of the sources used in the Document are genuine, accurate, complete, authentic and correct. Moreover, none of the director, shareholder, and member of the management or employee in any way is responsible about the genuineness, accuracy, completeness, authenticity and correctness of the contents of the sources that are publicly available to prepare the Document. It does not solicit any action based on the materials contained herein and should not be construed as an offer or solicitation to buy sell or subscribe to any security. If any person takes any action relying on this Document, shall be responsible solely by himself/herself/themselves for the consequences thereof and any claim or demand for such consequences shall be rejected by IDLC Investments Limited or by any court of law. Company Profile Singer Bangladesh Limited (DSE: SINGERBD) was incorporated in 1979, as a private limited company. Subsequently, in 1983, it was converted into a public limited company. Since 2003, the company is a direct subsidiary of The Singer Bhold BV, The Netherlands. It was listed with DSE in 1983 and with CSE in 2001. 75% of total shares of SINGERBD are held by its sponsors. Over its more than 100 years of business, the company has successfully transformed into one of the largest retailers of consumer durables and electronic products. Besides marketing its own brands, singer also markets a few other international brands like Whirlpool, Videocon, Onida etc. Key Revenue Drivers & Company Insight Currently, SINGERBD manufactures Color Television, Panel Television, Motorcycle, Cables and Furniture. The company utilized 95%, 33%, 2%, 1%, and 7% of respective product line. Production fell in all five major product lines except Furniture, due to stiff competition from local competitors and nationwide shutdown in last quarter of 2013. The company markets a wide array of products, among which Refrigerator and Television contributes significant portion of revenue. They each contributed 58% and 19%, respectively of total turnover of the company, in 2013. The new addition Furniture line contributed only around 0.12%, but is expected to pickup in future. Financial Performance Financial performance suffered severely in last year. Compared to a 1% decline in sales, Net Profit after Tax dropped by 22%. Increased cost of business, due to political turmoil in last quarter of 2013, hit Operating Margin significantly, dragging down overall profit. In addition, 6M 2014 performance remained downbeat, as well. Despite 19% growth in top line, bottom line reduced by 7%, due to higher cost of production. Recently, the company has reported net profit after tax of BDT 192.78 million with EPS of BDT 3.14 for the period of six months (Jan' 14 to Jun' 14) as against BDT 208.12 million and BDT 3.39 respectively for the same period of the previous year. Singer Bangledesh Limited (DSE: SINGERBD) Current Price (July 24, 2014 ) 182.30 Total Number of Share (mn) 61.36 Free Float (%) 25% Forward PE * –SINGERBD 29.01x Trailing PE * – SINGERBD 30.49x Forward PE – Engineering sector 23.23x *Based on latest earning disclosure Financials (BDT mn) 2012 2013 6M, 2014** (Unaudited) Turnover 6,703 6,605 3,305 Gross Profit 1,810 1,785 867 Operating Profit 762 586 277 Net Profit after Tax 490 382 193 Total Asset 4,493 4,236 5,046 Total Equity 2,540 2,633 2,337 **Year ends on Dec. 31 Growth (%) 2012 2013 6M, 2014 Turnover 23% -1% 19% Net Profit After Tax 23% -22% -7% Financials (BDT mn) 2012 2013 6M, 2014 Restated EPS 7.99 6.23 3.14 BVPS 41.39 42.91 38.09 Others 2012 2013 6M, 2014 Gross Profit Margin 27% 27% 26% Operating profit margin 11% 9% 8% Net profit margin 7% 6% 6% ROA 12% 9% 4% ROE 21% 15% 8% Stock Dividend 25% 25% - Cash Dividend 75% 100% - Source: DSE; Quarterly & Annual Reports of Singer Bangladesh Limited. and Research, IDLC Investments Ltd.