Wisynco Group Limited Analysis

Outlook and Recommendation

Wisynco’s recent growth in sales mainly resulted from the increasing effect of the addition of packaged sugar to its line of distributed products. Also, the Company recently announced a 30% investment in JP Snacks Caribbean Ltd and commenced the exclusive distribution of the St Mary’s range of Tropical Chips in Jamaica, at the end of April 2019. Going forward the Company is projected to reduce costs as a result of refinancing J$1.9 billion of its debt, cutting interest cost by 2.25% to less than 8%. In addition, the construction of Wisynco’s two megawatt-energy plant, which will be fueled by liquefied natural gas should help to control costs and improve margins. Wisynco’s history of operational efficiency and the strong enterprise value market share that its brands possess should keep the company in a stable financial position in Jamaica for the foreseeable future. However, we believe the Company may find it challenging to sustain its current price because of its significantly higher than average growth rate and therefore recommend Wisynco as a HOLD given our fair value estimate. We however advise you to consult an investment advisor at Barita Investments Ltd to discuss your individual circumstances before making any investment decision.

Market Statistics (Oct 18, 2019)
Price/share 22.25
52 Week High 30.00
52 Week Low 9.25
EPS 0.78
Sector P/E 22.93
P/E 28.53X
BV/Share 2.96
P/BV 7.52X
Estimated Fair Value 20.19

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