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倪國權先生 (Alex Ni)
助理經理

曾任職鋼材交易員及廣告公司主任,所以特別喜歡研究資源類及消費類股票。歡迎來電賜教或交流心得。
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現代牙科 (3600.HK)

Tuesday, February 19, 2019 Views2924

Stock Commentary                                                                                           Date: 18/2/2019

         

Stock:                                                     Modern Dental Group Limited

Closing price:                                      $1.46 (18/02/2019)

52 weeks range:                                         $1.20 - $2.53

Shares outstanding:                           990,277,000

Market Capitalization:                 HK$ 1.446 Billion

Target Price (12 months):                          No Target (initial coverage)

 

Summary :

This is an initial coverage of Modern Dental Group Limited. The company is dental prosthetic device provider and operates their businesses in various cities across the globe. They have three product lines: Fixed Prosthetic devices, Removable Prosthetic devices and Other Devices such as orthodontic devices, sports guards and anti-snoring devices etc. Fixed Prosthetic device is the main source of revenue of the company and currently, Europe and North America are major markets in contributing the company’s income, while Asian market segment continue to increase due to demand rising demand of dental healthcare.

 

Brief Look of the Company :

  1. Modern Dental Group Limited (the Company) is a global dental prosthetic device provider. Its businesses are across the globe. Listed on the Hong Kong Stock exchange in December 2015, the Company raised approximately HKD 664 million and the fund was used mainly to develop new businesses in oversea and acquire target firms.

The chart below illustrates the Company’s worldwide subsidiaries:

 

Source: Modern Dental 2018 interim report

 

In terms of revenue, both Europe and North America market contributed over 70% of the Company’s revenue in 2018, while Greater China market exhibited the largest growth rate in comparison with other markets. The table below explained the breakdown based on each market in their respective original currency against Hong Kong Dollar:

Source: Modern Dental 2018 interim report

 

  1. There are three main product lines (as categorized by the Company):
  1. Fixed Prosthetic devices such as crowns and bridges. These products target patients with dental problems and require dental surgical procedures to amend.

 b. Removable Prosthetic devices such as removable dentures.

               c. Other Devices such as orthodontic devices, sports guards and anti-snoring devices; also, raw materials, dental equipment and services etc.

 In terms of revenue return, fixed prosthetic devices as well as removable dentures are the major contributors to the Company. The graphs below illustrate the Company’s revenue mix as well as sales volume breakdown:

Source: Modern Dental 2018 interim report

SWOT ANALYSIS:

Strength :

  1. As dental healthcare importance increase, the company is able to capture the market share in dental prosthetic market through horizontal integrations.

Weakness :

  1. Niche market Barrier to entry may not be high.

 

Opportunities :

  1. Dental service in Asian market is growing, especially with aging population. The demand for dental prosthetic device increase.

 

Threat :

  1. Worldwide economic slowdown. Trade war.

 

「註:本人倪國權為證監會持牌人士。截至本評論文章發表日止,本人及/或其有聯繫者並無持有全部提及之証券的所有相關財務權益。」; Or
” I, Ni Kwok Kuen Alex, am a licensed person under the Securities and Futures Commission. Until the date this commentary was published, neither I and/or my affiliates are the beneficiary of the securities mentioned herein or are entitled to any financial interests in relation thereto. “

 

 

 

 

This report is produced and is being distributed in Hong Kong by Phillip Securities Group with the Securities and Futures Commission (“SFC”) licence under Phillip Securities (HK) LTD and/ or Phillip Commodities (HK) LTD (“Phillip”). Information contained herein is based on sources that Phillip believed to be accurate. Phillip does not bear responsibility for any loss occasioned by reliance placed upon the contents hereof. The information is for informative purposes only and is not intended to or create/induce the creation of any binding legal relations. The information provided do not constitute investment advice, solicitation, purchase or sell any investment product(s). Investments are subject to investment risks including possible loss of the principal amount invested. You should refer to your Financial Advisor for investment advice based on your investment experience, financial situation, any of your particular needs and risk preference. For details of different product's risks, please visit the Risk Disclosures Statement on http://www.phillip.com.hk. Phillip (or employees) may have positions/ interests in relevant investment products. Phillip (or one of its affiliates) may from time to time provide services for, or solicit services or other business from, any company mentioned in this report. The above information is owned by Phillip and protected by copyright and intellectual property Laws. It may not be reproduced, distributed or published for any purpose without prior written consent from Phillip.
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