Frencken Group - CGS-CIMB Research 2022-05-18: Striving To Defend Margins

Frencken Group - Striving To Defend Margins

  • Frencken (SGX:E28)'s 1Q22 revenue grew 9.3% y-o-y to S$198.4m, in line at 23.4% of our/Bloomberg consensus’ FY22F forecasts. 1Q22 net profit fell 12.6% y-o-y to S$12.8m, in line at 19.0% of our/Bloomberg consensus’ FY22F forecasts.
  • Frencken is working to improve the net profit margin achieved in 1Q22 of 6.5%.
  • As there was limited financial information in Frencken's 1Q22 business update, we adjust down our FY22-24F earnings per share forecasts for Frencken by 8.3-14.3% by varying our gross profit margin assumptions. Our gross profit margin assumptions have been reduced by 0.85-1.40% as we factor in inflationary cost pressures, partially mitigated by Frencken’s ability to pass on costs and move some of its business to better margin higher level assembly work.
  • We reiterate ADD call on Frencken but our target price is lowered to S$1.77.

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

William TNG CFA CGS-CIMB Research | 2022-05-18
SGX Stock Analyst Report ADD MAINTAIN ADD 1.77 DOWN 2.060

Previous report by CGS-CIMB:
2022-02-28 Frencken Group - Expecting H-o-h Revenue Growth In FY22

Target prices by 4 other brokers at Frencken Target Prices.
Listing of broker reports at Frencken Analyst Report.

Relevant links:
Frencken Share Price History,
Frencken Announcements,
Frencken Dividends & Corp Actions,
Frencken News Articles


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