InvestIdeas

TA Research assigned a fair value of RM1.71 per share for the Main Market-bound 99 Speed Mart.

(IPO) price of RM1.65 (Forward PE of 29 times)

Extensive network of over 2,500 outlets.

Market share of 40.1% and 11.6% in the mini-market industry and grocery-based retailer industry,

Sales growth for the financial years of 2024 to 2026 (FY24 to FY26) to be between 4.7% and 7.6%.

It forecast the group’s net profit to grow by 11.4% in FY24, 10.6% in FY25 and 11.5% in FY26.

Profit after tax margin is likely to improve gradually to 4.6%, 4.9%, 5% in FY24, FY25 and FY26.

Forward dividend yield of 1.6% to 2%.

Revenue of RM2.4bil for the second quarter ended June 31, 2024 (2Q24), reflecting a RM183.3mil or 8.2% year-on-year (y-o-y) increase due to higher sales from new outlets and positive impact of its bulk sales eCommerce platform.

Net profit rose by RM50mil or 66.3% to RM125.5mil mainly due to the reasons stated above and the upward adjustment of the distribution centre fee rates charged to the suppliers for the handling of products.