Introduction
Bioalpha is a home-grown integrated health supplements company. The company venture into farming its own herbal based raw material. It operates the largest herbal parks in Malaysia with approximately 1300 acres in Pasir Raja, Terengganu and Desaru, Johor. In terms of raw material supply, Bioalpha will not have much problem as it is self-sufficient. Phase 1 development has been completed with 20 types of herbs planted over approximately 120 acres of land. Phase 2 development has started and will be planting a total of 100 types of herbs over the next 24 months.
The group also has a proprietary liquid fermentation technology (patent-pending) develop by its in-house R&D team. This technology has provided our Group with a competitive edge and significantly reduces the duration required to cultivate medicinal mushrooms from one (1) year (grown in the wild) to just five days in a controlled water-based environment aided by the use of specially formulated mediums.
The group, being an Origina Brand Manufacturer (OBM), manufactures its own brand health supplements under own brand name - Apotec and Nushine in Malaysia; Alpha Health in Indonesia. Bioalpha, also being an Original Design Manufacturer (ODM), produce products using its own proprietary formulations and sell the products under customers' brands. With support from skilled R&D team who constantly develop new formulations, the group is able to roll out new products periodically to excite the market and sustain demand.
In terms of retain segment, the group completed the acquisition of "CONSTANT" pharmacy chain. The group plan to grow the pharmacy operation via franchise model in order not to burden their balance sheet. The group also having strategic partnership with ANGKASA to offer franchise opportunity to their members.
Financial Highlights
Revenue has been growing by CAGR of 26% for the past 5 years from FY2011 - FY2016
Net Profit grows at CAGR of 7.9% for the past 5 years.
Net Profit margin in FY2016 is 18.5% drop from 22.9% in FY2015. This is due to the acquisition of retail pharmacy CONSTANT in January 2016 which typically is a low margin business.
Business segmentation
Manufacturing & sale of finished health supplement products - 68.6% of revenue
Retail pharmacies - 31.4% of revenue
Segmentation by geographic
Top 3 shareholders of the company as at 31 March 2017:
Mr. Hon Tian Kok @ William is our Founder, Substantial Shareholder, Promoter and Managing Director/Chief Executive Officer. He was appointed to our Board on 21 June 2011 and is responsible for overseeing our Group’s performance and strategic direction.
Perbadanan Nasional Berhad (PNS) is an agency owned by the Ministry of Finance Incorporated (MOF Inc.) with the mandate to lead the development of Malaysia’s franchise industry. PNS aims to develop the franchise industry while increasing the number of franchise entrepreneurs through its expertise in providing quality service and products.
Malaysian Technology Development Corporation (MTDC), a company wholly-owned by Khazanah Nasional Berhad, is in the business of Fund Management, Incubation, Advisory, and Nurturing Services. The company was established in 1992 to promote the adoption of technologies by local companies via commercialisation activities of local inventions or acquisition of foreign technologies.MTDC has been the key player in commercialisation and managing of Government funds since the 7th Malaysia Plan and it also has a well-established reputation as the key player in Malaysia in the promotion of technology-based companies.
Note that PNS has reduced its shareholding to 7.96% or 63.8 mil shares as at 18 April 2017.
Disclaimer: The above information is NOT a recommendation to buy or sell stocks. They are only for sharing and educational purposes only. Any trade that you undertake as a result of the above information is solely at your own risk. Please consult your own investment advisor before undertaking any investment decision.
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