Saturday 28 May 2011

QL: Slow & Steady

There is one company that make more & more money every year since 2004, even during recent recession in 2008. Its share price never really go into a significant downtrend since listed in 2000 (11 years ago!).

This company, QL Resources is not a multi-national or hi-tech company. It's just chicken company - in poultry business, and the management can make it really big. The ROE is persistently above/around 20%, which shows good management in term of increasing shareholders value. No need to write so much, the chart and statistics will tell everything.

     QL financial highlights 2006-2010                                        

     QL monthly share price chart since listed in 2000 (11 years!)    

     QL weekly chart since Jan 2009. Never look back.

It's a common sense that the profit and the share price will not rise forever. There will be time when the company's growth will go plateau and the share price drop. Can this happen in the near future? I'm also keen to know.

QL's business include livestock, marine and palm oil. Even when economy is not good, everyone still need to eat chicken, eggs, fish etc. The company grows mainly through successful acquisition. I think the space for further growth may depend on how successful QL tap into market outside Malaysia. Currently QL has only oil palm plantation in Indonesia. The management seems to plan for venturing into the poultry market in Indonesia & Vietnam. If this plan materialize, then the possibility of continuous revenue and profit growth is high.

QL is currently at RM3.35. It may be a good stock to hold long term. If 2 years ago (1st June 2009), you bought 5000 QL shares at RM2.70 (total capital RM13500) and hold it til today, after bonus issues and share split, now (28th May 2011) you will have 12000 shares at RM3.35 (total capital RM40200). Your investment in just 2 years will gain RM26700 or 200%!

No comments:

Post a Comment