Sasbadi Holdings (Sasbadi), a leading local educational material
publisher with over 29 years of history, is slated for public listing on
23 July 2014. The company mainly undertakes print publishing, focusing
on primary and secondary school education as well as non-curriculum
based educational materials. We see its online publishing and foray into
educational materials for national-type schools and general titles
business in Bahasa Malaysia and Chinese as the growth drivers for the
company in the future. We suggest investors subscribe to this new
listing as we see a potential fair value of RM1.50, which is based on
60% discount to the education industry average FY15 PER of 22x.
Background. The group is primarily involved in publishing and printing of a wide variety of books ranging from government textbooks and revision books for both primary and secondary schools to children’s books and multimedia educational products. It started its publishing business in 1985 under the founders, Mr. Law King Hui (Managing Director) together with Mr. Lee Swee Hang and Mr. Lee Eng Sang (both Executive Directors). Today, it has become a reputable publisher of educational materials in Malaysia under the brand names of “Sasbadi”, “Sasbadi Online”, “Maya Press”, “Orbit Buku” and “MBP Publications”. It commands a 6% market share in the publishing of books, brochures and other publications and 9% of printed educational materials in Malaysia.
Expansion plans. To diversify its earnings base, the group embarked into online publishing in 2011, seeing some measure of success since then with earnings growing from RM0.6m to RM5.8m last year. It continues to roll out new online educational resources to cater to teaching and learning of various skills such as listening, thinking and speaking. Besides that, it also plans to venture into a publishing business that focuses on educational materials for national-type schools (Chinese) and also general titles business in Bahasa Malaysia and Chinese. Apart from its existing business expansion, the group also plans to set up two applied learning centres in pedestrian traffic areas to provide training and education to young children.
Risks include i) change in National Curriculum and educational policies, ii) fluctuation in paper cost, iii) dependency on successful textbook tender from the Ministry of Education and iv) foreign exchange transaction, which accounts for 9% of purchase of materials, services and product costs.
Source: PublicInvest Research - 14 Jul 2014
Background. The group is primarily involved in publishing and printing of a wide variety of books ranging from government textbooks and revision books for both primary and secondary schools to children’s books and multimedia educational products. It started its publishing business in 1985 under the founders, Mr. Law King Hui (Managing Director) together with Mr. Lee Swee Hang and Mr. Lee Eng Sang (both Executive Directors). Today, it has become a reputable publisher of educational materials in Malaysia under the brand names of “Sasbadi”, “Sasbadi Online”, “Maya Press”, “Orbit Buku” and “MBP Publications”. It commands a 6% market share in the publishing of books, brochures and other publications and 9% of printed educational materials in Malaysia.
Expansion plans. To diversify its earnings base, the group embarked into online publishing in 2011, seeing some measure of success since then with earnings growing from RM0.6m to RM5.8m last year. It continues to roll out new online educational resources to cater to teaching and learning of various skills such as listening, thinking and speaking. Besides that, it also plans to venture into a publishing business that focuses on educational materials for national-type schools (Chinese) and also general titles business in Bahasa Malaysia and Chinese. Apart from its existing business expansion, the group also plans to set up two applied learning centres in pedestrian traffic areas to provide training and education to young children.
Risks include i) change in National Curriculum and educational policies, ii) fluctuation in paper cost, iii) dependency on successful textbook tender from the Ministry of Education and iv) foreign exchange transaction, which accounts for 9% of purchase of materials, services and product costs.
Source: PublicInvest Research - 14 Jul 2014
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