MoneyMax

MoneyMax: Phillip Securities initiates at Buy with TP $0.48, implying 21.8x FY13e P/E, 2.7x P/B. MoneyMax is one of Singapore’s largest pawnbroking chains with 29 outlets located island-wide, operating under the brands of “MoneyMax” and “Cash Online”. MoneyMax also provides retail and trading business of pre-owned gold, jewellery and watches. The house notes the rising New Age for pawnbrokers. Sees higher cash needs from tighter loan regulations, reducing social stigma on stronger branding and better quality of service, as key factors lifting demand for pawnshops. The business itself, because of its collateralized financing nature, is inherently lower risk. Phillip believes all three pawnshop chains are expected to experience increase in their pawnbroking profits. Nevertheless, MoneyMax may have a higher growth potential from existing outlets as compared to ValueMax. Moreover MoneyMax’s current P/E valuations lower, more attractive than Maxi-cash.