Padini Holdings (PAD: MK) is arguably one of the most successful local retail brand in Malaysia. The company focuses on retailing apparels, footwear and other accessories through its many brands such as Padini, Vincci and Seed. It has been a favourite for investors in the past few years. Its share price has risen from below RM0.40 per share back in 2009 to a current price of around RM2.00. Investors would have enjoyed roughly 500% gain in 5 years. Its operating profits are just as impressive. Its earnings per share grew from just 1.0 sen per share in 2004 to 14.1 sens for the latest trailing twelve months (TTM). That is an impressive 30% growth rate a year. Here is three things you might not know about this retailer.
Although Padini still gets most of its revenue in Malaysia. The brand has already been selling internationally through its franchisee and dealers in other markets. Padini actually has presence in regions like Southeast Asia, the Middle East and Pakistan.
Most Valuable Brands
Padini is recognized as Malaysia’s top 30 most valuable brands and has a brand valuation of RM260 million. The company actually started the Padini brand since 1975. Next year, the company will be celebrating its 40th year since Padini enter the retail market.
Return on Equity
Return of equity is a measure of how well a company is able to generate return from its invested capital. Padini has a track record of maintaining its ROE above 20% for the last few years. It is definitely one of the few companies that is able to consistently generate good returns for its shareholders. It is yet to be seen if the company can continue its good ROE going forward.
Value in Action
Great company is hard to come by. Furthermore, these type of companies generally do not trade at a “cheap” price. It might be interesting to see how Padini will perform in the next 40 years.Join us on Facebook for more exciting updates and discussion about value investing. Submit your email address for important market updates and FREE case studies![contact-form-7 404 "Not Found"] We will only provide you with information relevant to value investing. You can unsubscribe at any time. Your contact details will be safeguarded. The information provided is for general information purposes only and is not intended to be any investment or financial advice. All views and opinions articulated in the article were expressed in Stanley Lim’s personal capacity and do not in any way represent those of his employer and other related entities. Stanley Lim do not own any shares in the companies mentioned above.