Delfi - CGS-CIMB Research 2022-05-19: Picking Up Where It Left Off

Delfi - Picking Up Where It Left Off

  • Delfi (SGX:P34)'s 1Q22 revenue of US$133.0m (+11.4% y-o-y; +23.6% q-o-q) came in at 30.6%/30.5% of our/consensus’ FY22F revenue forecasts, indicating a return to pre-COVID levels of sales (1Q20: US$136.6m).
  • In its business update, Delfi cited ongoing uncertainties and challenges arising from political uncertainties, currency volatility and supply chain bottlenecks that have led to persistent raw material inflation. Although gross profit margins were stable y-o-y at 29.4% from 29.2% in 1Q21, we note that there was a 3.3% points decline q-o-q, which could suggest a changing sales mix between its value/premium products and creeping raw material prices. Average inventory days of 60 seems low even after considering seasonality factors, which might suggest higher inventory replenishment costs moving forward.
  • Our target price of S$1.09 for Delfi is based on 18x of FY23F P/E, which is 0.5 standard deviation below its 5-year historical mean and similar to competitor Mayora.
  • Delfi’s net cash position of US$99.9m also remains supportive of 60% payout ratio, which would translate into a respectable ~5% yield moving forward.

Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @

TAY Wee Kuang CGS-CIMB Research | Izabella TAN CGS-CIMB Research | 2022-05-19
SGX Stock Analyst Report ADD MAINTAIN ADD 1.090 SAME 1.090

Previous report by CGS-CIMB:
2022-04-11 Delfi - Committed To Be ‘Better For You’

Relevant links:
Delfi Analyst Report,
Delfi Target Price,

Delfi Share Price History,
Delfi Announcements,
Delfi Dividends/ Corp Actions,
Delfi News Articles


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