This article first appeared in The Edge Financial Daily on October 3, 2017 - October 9, 2017

Lay Hong Bhd (+ve)

SHARES in Lay Hong Bhd (fundamental:0.45 /3, valuation: 1.7/3) triggered our momentum algorithm yesterday for the fifth time this year. The share price gained two sen or nearly 2% at RM1.04, with 2.5 million shares changing hands, exceeding its 200-day average volume of 756,438 shares. Lay Hong, an integrated livestock farming company, recently shared that it has allocated for its financial year ending March 31, 2018 (FY18) a capital expenditure amounting to RM50 million, to be equally utilised for its layer and broiler capacity expansion. Production capacity for its broiler is expected to increase from 1.1 million birds per month to 1.5 million by end-FY18 and to two million by FY19.

Its net profit for the first quarter of FY18 ended June 30, 2017 lifted nearly 10-fold from RM419,000 or seven sen per share last year to RM4.42 million or 73 sen per share. Quarterly revenue increased from RM158.95 million to RM183.04 million, representing a 15.16% growth. At the current share price, Lay Hong is trading at 2.2 times its book value.