"In addition, management’s focus on expanding Vietnam has shown positive signs in terms of traction," writes Seet in his June 26 note, where he expects the upcoming 2QFY2023 ending June 30 numbers, expected in August, should remain strong.
And despite a substantial forex gain of US$7.3 million booked in 1HFY2022, Seet expects the upcoming 1HFY2023 earnings to be better.
Besides the resilient business, Seet notes that Food Empire has been doing share buy-backs consistently over the period even at current price levels. The last buyback was conducted on June 21 at $1.04.
Since the mandate was renewed in April, the company has bought back nearly 1.6 million shares.
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Separately, on June 26, the company announced after market that it had bought back 300,000 more shares at an average price of $1.01899. This brings the total number of shares bought back to 1,887,800 shares.
"We believe this exercise will likely continue as management concurs with our view that the shares are undervalued. We believe management is also exploring other ways to unlock value for shareholders," says Seet.
Food Empire shares are trading unchanged at $1.01 on June 26.
