By BERNAMA
The earnings of Asia Brands Bhd is expected to grow significantly, with less volatility in years to come, and following the recent acquisition of the Anakku and Audrey apparel brands.
Kenanga Research said Asia Brands’ net profit for its financial year ending 2015, is expected to jump in the range of 17 to 22 percent, on the back of RM389.9 million to RM443.4 million in sales.
This would be higher than its peers, Padini or Bonia’s, estimated earnings growth.
“We expect the group’s earnings to be less seasonally volatile as half of the company’s revenue will now be driven by the Anakku brand,” the research house said.
It added that, from previously with a negligible market share within the highly competitive fashion retail segment, Asia Brands had now established itself to become a market leader within the baby apparel and lingerie segments with the two respective acquisitions.
Kenanga said it believes that the acquisitions will bring positive synergies to Asia Brands via the market leadership of Anakku and Audrey – 29 percent and 16 percent market shares in the baby apparel and lingerie business segments respectively – which suggest a more resilient demand prospects.
“The acquisition of Audrey and Anakku also provides Asia Brands with an enlarged retail network of 189 outlets and more than 1,000 consignment counters, which could unlock its potential in tapping into a bigger share of Malaysia’s rising middle income group.
“This would spark an expansion trail for its existing casual lifestyle segment into regional or neighbourhood malls,” the research house said.
– BERNAMA
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