[Post 99] Trip To Invest Fair 2019!

17 AUGUST 2019 Saturday

171819 (Sat) Day One

Well, I haven't been to invest fair for ages(not since 2016 anyway, haha). So I thought, I will pop down to it this year.

This year invest fair is situated at Suntec conventional center, the last time I went was outside Ngee ann city, compare to that Suntec seem like a better choice

I did not take many pictures about the event areas(but I did took many brochures though)

Basically, this is what is did...

1. Walk around the whole exhibition 

2.Sign up for the LIM&TAN securities(why?: Because DBS no longer give company report)

3.Sign up for CIMB (Why?: Also for the company report)

4. Sign up for a SAXO account(why?: After researching, I deem it to be one of the best brokerages to buy US stock, oh I got an umbrella also as a free gift! who doesn't love a free gift?)

5. Listen to the stock pitch

Here are some pictures taken during the stock pitch from investingnote top member(Lim Guang sheng and lynlyn)

The stock that they are promoting is Singapore O&G(stock code:1D8)

As of 31 December 2018, the Group has a total of 14 medical specialist medical practitioners, across four business segment -O&G, Cancer-related, Dermatology, and Pediatricians, comprising :

-Six O&G Specialists 

-Three Cancer Specialists: One Gynae-Oncologist and two breasts and General Surgeons

-Two Dermatologists

-Three Pediatricians

SOG was listed on the Catalyst board of the Singapore Exchange Securities Trading limited

since 4 June 2015

Company Overview: OVERALL GROWTH

Business Strategy

Progressive approach

• Recruit more O&G Specialists to enlarge the core O&G segment of the group
• Build up patient load for Pediatrics segment 
• Increase the level of inter-clinic referrals through synergy awareness
• Continue to grow non O&G business segment to increase revenue and profit

Overseas strategy 

• Look out for overseas opportunities, especially in an area where are not just financial but also, the humanitarian and other ancillary perspectives 

INVESTMENT THESIS

Singapore O&G ability to future market growth, based on the well-established track record on Primary and Secondary healthcare for Women and Children create an optimistic investment that has been undervalued in the market 

Recommendation :Buy FY 2019,Current Price $0.395, Price target: $0.50 (26.6%)

(Some of you may be curious and check, as of now Singapore O&G is $0.29 Date:25/11/2019, this is within expectation as after the stock pitch I went up to them and ask whether the O&G stock price will drop due to Singapore recession, they did confirm it, so don't blast them for their inaccurate information)

Risk

• Company is dependent on its continued ability to retain its key management personnel and specialist medical practitioners 

• Singapore O&G is exposed to risks in respect of outbreaks especially Zika virus 

CATALYSTS 

• Growing number of cancer-related problems for women 
• Singapore's healthcare system has gained international recognition for its efficiency and coverage with all citizens and permanent residents enjoying coverage by Medishield Life for basic medical coverage

INDUSTRY ANALYSIS 

OVERALL HEALTHCARE 

• Healthcare is a recession-proof industry. The below data point to a probable recession in Singapore.Defensive stock amid economic uncertainty for 2020
• Asia's overall healthcare spending is projected to surge to US$2.27t by 2026 from the US $1.69t in 2017, driven by higher healthcare cost, the rising incidence of chronic diseases, a burgeoning middle class and an overall shift in the age  

Porter' FIVE FORCES ANALYSIS

New Entrants(Low-Medium)

• High startup costs and the industry is extremely capital intensive and need medical specialists to run create barrier to entry to this healthcare industry in Singapore

Substitutes(Low)

• The primary substitute is the government hospital. People come to private healthcare for better performance and service hence threat is low

Supplier Bargaining(MEDIUM-HIGH)

• Medical specialists, healthcare staff, and medical equipment are needed to support Singapore's O&G healthcare services. Specialists with experience are hard to be replaced

Buyer Bargaining (MEDIUM)

• Demand for women and children private healthcare service is increasing and patients visit Singapore O&G for their healthcare service 

Industry Rivalry  (MEDIUM)

• Compete solely based on reputation and good service to maintain market share and stay afloat

Industry analysis

Strengths

• A leading group of specialist medical practitioners, with a long and established track record in the Obstetrics and Gynecology
• The balance sheet remains healthy with cash and cash equivalents at $25.1 million as at 31 March 2019 compared to $21.5 million as of 31 December 2018. The group has no borrowings as at 31 March 2019

Weakness 

• Operationally, expenses were higher in Q1 2019 compared to Q1 2028 due to a 21.5% increase in consumables and medical supplies used in procedures by all segments 
• Smaller market cap compared to peers 

Opportunity

• A growing number of cancer-related problem for women
• Singapore healthcare system has gained international recognition for its efficiency and coverage with all citizens and permanent residents applying for coverage by Medishield Life for basic medical coverage

Threats

• Dermatology segment registered s$0.3 million decline in revenue from Q1 2018 due to an increasingly competitive landscape for this segment 
• Private players were left to fight the remaining 22-23% of the market, the tertiary healthcare market in Singapore is monopolized by public hospital which snapped up 77.8% of admission in 2018

Industry analysis

Weakness analysis

There is some weakness in the Dermatology segment, however, but we are confident that the company  has the ability to strengthen with the growth in anti-aging business as reported by some key players as reflected by table(Unfortunately, my picture wasn't clear enough)

Overall Growth

• In 2018, despite a 1.3% decline in total live-births to 39.115 from 39.615 in 2017, Singaproe O&G segment registered 108 more birth in FY 2018, bringing the total number of babies delivered in FY 2018 to 1,824 as compared to 1,716 in FY 2017

• With the growing demand for O&G services, Singapore O&G plans to further increase their specialist in FY 2019, which is a growing pie for this company to tap on 

• In Singapore, statistics have shown that cancer cases have been rising and breast cancer is top cancer affecting women. Our highly-trained cancer-related specialist provides an extensive range of breast care services, both medical and surgical to treat diseases of the breast and also educate our patient and their families to conduct regular self-examinations for early detection. In FY 2018, our cancer-related segment accounts for 15.3% of the group total revenue(Once again, apologize for poor photo taking)

Will continue at the next Post!