Our website is made possible by displaying non-intrusive online advertisements to our visitors.
Please consider supporting us by disabling or pausing your ad blocker.
Even though the subscription results were delayed, the company still released its quarterly results on time. Hock Soon posted a net profit of RM8.4 million on RM47.73 million revenue, giving a gross margin of about 34% and a net margin of 17.6%
Investors looking at the IPO price of 60 sen are entering at a valuation that appears reasonable compared to the broader industry.
IPO Price = RM0.60
Market Cap = ~RM300 Million
FY2025 Revenue = RM147.4 Million
FY2025 Net Profit = RM42 Million
PE Ratio = 7.1x
- Peer Comparison: With a Price-to-Earnings (PE) ratio of 7.1 times (based on FY2025 earnings), Hock Soon is priced at a discount compared to established giants like QL Resources or Teo Seng Capital, which typically trade at double-digit PE multiples.
- Management View: The management openly acknowledges they are an "emerging player" compared to these mature peers, which offers investors a "growth stage" entry point rather than a saturated one.
The Bottom Line
Hock Soon Capital presents a classic "growth at a reasonable price" setup. While they face the usual risks of the poultry industry (feed costs and disease outbreaks), the dual engines of doubling production capacity and the high-margin Singapore export potential provide a strong neutral-positive outlook.
If the SFA approval comes through in Q1 as targeted, the narrative for Hock Soon could quickly shift from a domestic volume play to a regional margin play.
Aggressive Expansion: Doubling Production Capacity
Hock Soon is not just relying on higher prices; it is also aggressively scaling volume. The group plans to raise RM60 million from the public issue, with the vast majority (nearly 90%) allocated to a massive expansion project.
- New Facility: A new poultry farm is being developed in Teluk Intan, Perak.
- Capacity Boost: Upon completion, this new farm is expected to add 1.53 million eggs per day to the group's output.
- Total Impact: This represents a near-doubling (~95% increase) of their existing capacity of 1.63 million eggs per day.
This capacity expansion is timed well to capture the anticipated export demand while maintaining their stronghold in the Central Region of Peninsular Malaysia, which currently contributes over 75% of their revenue.
