SHH Resources Holdings Bhd (-ve)
SHARES for SHH (Fundamental: 2.5/3, Valuation: 2.4/3), which traded range bound — between 75 sen and RM1 — for much of the past one year, gained traction since March 20 and surged to at an all-time high of RM1.44 yesterday.

The wood-based furniture manufacturer — which exports mainly to the US market — was featured in this week’s Edge Malaysia as a potential takeover target by upstream particleboard manufacturer, HeveaBoard Berhad. 

SHH was in the red in FYJune2011-FY2012, affected by the then strenghtening ringgit against the US dollar and rising production costs. The company returned to profitability in FY2013 with net profit of RM1.5 million, which surged to RM8.2 million in FY2014.

For 1HFY2015, however, SHH’s net profit declined 53.3% y-y on the back of lower revenue as orders from customers slowed. Sales were down 14.5% y-y.

The stock currently trades at trailing 12-month P/E of 10.2 times and 0.9 times book-value.

This article first appeared in The Edge Financial Daily, on March 31, 2015.