Goodpack

Kim Eng recently concluded a non-deal roadshow for Goodpack in the USA where its resilient business model and dominant competitive position has been well-received by several fund managers. The key highlights include: 1) Mgmt believes its strong net profit margins of almost 30% will be sustainable due to the high barriers of entry to its IBC business, 2) CIMC owns 3% of Goodpack, has been on an acquisition spree and may possibly take this strategic alliance further.
3) Goodpack has now secured a minor contract with an unnamed client in the auto-sector, whereby they will ship car seats from Malaysia to Vietnam/ Indonesia. With several other trials underway, we believe the Group could make good progress in this exciting sector over the next six mths. Goodpack is on track to make progress into new product verticals such as chemical and auto parts, which will complement the demand recovery and further mkt penetration.We maintain our BUY rating and TP of $2.18.