The
word "Seng" is an old famously used name amongst the Chinese people
in the 1980 and 1990s. Many of my friends have their names ending as Boon Seng,
Hock Seng, Beng Seng and many others. Therefore, it was very common to refer
them as Ah Seng, and there are many Ah Sengs as today.
But
there are also several "Sengs" in Bursa Malaysia. Notably the famous
ones are the two Hap Seng, Keck Seng,
and to a lesser extend Tek Seng, Teo Seng and KKSeng.
Amongst
these "Seng" group of companies, there is one very low profile
company that have actually rewarded early-days investors with its share prices
increasing several folds over the years.
It
is consumer counter biscuit maker Hup Seng Industries Berhad.
Hup
Seng produces various types of biscuits that are a favourite among Malaysians
and even foreigners. Yes, I saw them buying the cream crackers at the
supermarkets. The most popular ones must be its "Ping Pong" brand
cream crackers biscuits. Why is their cream crackers biscuits so popular? It is
crunchy, delicious and a nice aroma when one bites it slowly and munch it in
the mouth. When you dip it into a hot beverage and eat it, one will feel a
different nice and soft taste. Even my family is hooked by its unforgettable
crunchy taste!
As
proof of how popular their cream crackers biscuits is, there is even another
biscuit maker from Johore packaging their cream crackers biscuits in a similar
design in similar colours!
A
few years ago, Hup Seng began to attract my attention when they began to
advertise in The Star declaring dividends payment in a two column
advertisement. And there were plenty of dividends announcement from time to
time. In an interview with The Edge published on November 16, 2009, Datuk Kerk
Choo Ting, then an operating director said Hup Seng would distribute a payout
of "at least 60% of the annual profit after tax" with effect from the
current financial year. Cash at that year stood at around RM40 million.
However
as at end of 2012, cash in hand had ballooned to almost double at RM79 million,
but the dividends payout was as spectacular as well. The last two years
dividends payout exceeded more than 100 percent. (See chart).
So
is Hup Seng still a good buy at this point with its share price at around RM4.30. For dividends wise, it is. It paid
out a total of 30sen in 2012 and that is a high 7.0% yield. Yet it was not even
mentioned as one of the top ten dividends paying stocks in the latest July
issue of Personal Money!
Another
plus point is the management team running the company. It is quiet a closely
related family business. The top 30 largest shareholders comprise of many of
their own related family members.
Hup
Seng had done well in its 1st Qtr 2013 earning 7.42sen. It will announce its
2nd Qtr in August and most probably followed by a good interim dividend
payment.
As
this is my first article sharing about my 20 years of experience in the stocks
market, I hope you will enjoy reading it. Any feedback and sharing of ideas
would be very much appreciated. My email is kassim123888@gmail.com
Note:
The writer bought 3,000shares of Hup Seng on 8th December 2010 at rm1.89 and
went on to receive a total dividends of RM1860.00 so far and is still happily
keeping the shares until today.
