February 23

Why You Should Look Out for Libra Group Ltd (SGX:5TR) This March

Libra Group Limited (SGX: 5TR) will be releasing its financial year result on 1 March 2017, which is coming up in less than a few weeks’ time! As we draw nearer to the date, let us dig into the past financial health of this company to determine if it will be able to generate good returns for the upcoming financial year.

What does Libra group do?

If you have not heard of Libra Group Ltd, the company’s business can be classified into 3 segments. Its main contract business serves as a general contractor for building construction, including upgrading works, as well as invests in properties. In addition, it also provides M&E services which include manufacturing and installing ACMV systems, fire alarms and air-conditioning. Its last business arm deals with the manufacturing and sale of ACMV ducts and trading of ACMV related products.

Now Here is the Catch…

Libra Group Ltd has a total market capitalisation of S$18.2 million and as of FY2015, its business has brought in S$90.2 million. That is close to 5 times its market capitalisation! Looking at its revenue growth over the past 4 years, the figures displayed an increase in demand for its goods and services over the years. The numbers are graphed below for your easy reference.

The period of FY2014 has shown a new record in the company’s fundamentals. Compared to FY2013, revenue grew by 102% to S$63.7 million and net profit attributable to shareholders surged by 922% to S$5.3 million. This milestone is due to the addition of a new building and construction solutions segment which set the stage for continued growth. Since then, there has been a huge jump in gross profits of the company which remain consistent subsequently.

What About the Downside?

One downside of the company will be its cash flow which tend to fluctuate over the last 4 years. As a result, there is uncertainty in whether the company will be able to pay consistent dividends in the near future. Furthermore, Libra Group Ltd has its business operations concentrated only in Singapore and thus it will be prone to the economic fluctuations of the country.

But all in all, Libra Group Ltd has displayed huge growth in its business operations since 2014. The company is under the leadership of Mr Chu Sau Ben, who was a winner of the Asia Pacific Entrepreneurship Awards 2015.

Feel free to check out his story here. Therefore, the release of the financial year results on 1 March will definitely be an event to look forward to and hopefully, the company will be able to continue its strong growth.

Libra Group Ltd has a P/E ratio of 3.2 and a dividend yield of 4.52%. It last closed at a price of S$0.15.

 

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Tags

ACMV, Chu Sau Ben, Libra, Libra Group


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