Asia File – meeting digital disruption

As a stationery company, Asia File faces the threat of digital disruption. The Group has recognized this by not expanding into this sector. Instead, it diversified into food wares and consumer wares that in 2023 accounted for 16% of the Group revenue.

Both the stationery and food/consumer wares businesses are profitable and generating good returns.

The challenge is that about 2/3 of its capital is tied up in non-operating assets that generated low returns. This has resulted in overall low returns for the Group. It would have to depend on new ventures to rectify this. The Group is financially strong and this will give it time to deliver these.

My valuation showed that it is not a value trap. There is sufficient margins of safety to invest at the current market price. But you need to have a long-term view. https://i.postimg.cc/J05QW2qr/Chart-9-min.png

For details visit “Is Asia File still a value trap as of Nov 2023?” at https://www.i4value.asia/2023/11/is-asia-file-still-value-trap-as-of-nov.html#more