Aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa
Time to shop Bloomberg code Reuters code FJB SP FJBN.SI Market cap 12 month range SGD244.6m (US$188.1m) SGD0.25 - 0.46 EPS est. change n.a. We initiate coverage with an OUTPERFORM rating and a price target of S$0.55/sh, providing potential upside of 27%. FJ Benjamin Holdings (FJB) is South-east Asia’s leading fashion and lifestyle group with fifty years of retail, distribution and brand-building. We see FJB as a direct proxy for the fast-recovering economies in Asia, underpinned by its prime retail network and growing brand portfolio. Earnings upside stems from brand extension of RAOUL into new lucrative markets like China, in our view. Year end: June 2010 2011E 2012E 2013E Sales (SGDm) 289 332 394 471 EBIT (SGDm) 9 15 20 27 EBITDA (SGDm) 17 24 31 38 Pretax profit (SGDm) 9 16 21 27 Earnings (SGDm) adjusted 8 12 17 21 Diluted EPS (SGDcents) adjuste 1.39 2.19 2.92 3.78 Diluted EPS growth (%) adj. nm 57.6 33.6 29.3 DPS (SGDcents) 2.00 1.53 2.04 2.64 DPS growth (%) 300.0 -23.5 33.6 29.3 EBITDA margin (%) 5.9 7.4 7.8 8.1 EBIT margin (%) 3.3 4.6 5.2 5.6 Net margin (%) 2.9 3.8 4.2 4.6 Div payout (%) 137.7 70.0 70.0 70.0 Book value/share (SGD) 24.1 24.8 25.7 26.8 Net gearing (%) -5.4 -5.8 -5.3 -7.4 ROE (%) 6.1 8.9 11.6 14.4 ROACE (%) 6.1 8.9 11.6 14.4 FCF (SGDm) 21.7 9.5 11.1 18.6 EV/Sales (x) 0.8 0.7 0.6 0.5 EV/EBITDA (x) 13.9 9.7 7.7 6.1 PBR (x) 1.8 1.7 1.7 1.6 PER (x) 29.6 19.7 14.7 11.4 Dividend yield (%) 2.4 5.2 4.5 4.9 Source: Company, Standard Chartered Research estimates Share price performance 0.25 0.30 0.35 0.40 0.45 0.50 Oct‐09 Jan‐10 Apr‐10 Jul‐10 Oct‐10 FJ Benjamin Holdings Limited STRAITS TIMES INDEX (rebased) Share price (%) -1 mth -3 mth -12 mth Ordinary shares -4 25 19 Relative to Index -7