This article first appeared in The Edge Financial Daily, on December 30, 2015.

THREE-A Resources Bhd(-ve)

THREE-A Resources (3A) (Fundamental: 2.1/3, Valuation: 1.4/3) first triggered our momentum algorithm on June 9 at 99 sen. The stock was picked again yesterday, closing 3.9% higher at RM1.08.

3A is a leading food & beverage (F&B) ingredients manufacturer with products such as caramel colour, glucose syrup/high maltose syrup, maltodextrin, soya protein sauce and vinegar. It also has a 50% stake in Three-A (Qinhuangdao) Food Industries Co. Ltd, a joint venture company with Wilmar International Limited.

Notably, 3A is the sole local manufacturer of maltodextrin, a glucose-based powder products mainly used as an ingredient for a variety of F&B products such as nutritional beverages, sauces, ice cream and infant milk powder.

For 9M2015, revenue rose 10.4% y-y to RM258.5 million while net profit jumped 26.2% to RM17.0 million, mainly due to higher sales and forex gain. Losses incurred by its joint venture company widened to RM4.5 million, from RM4.3 million in 9M2014.