PETALING JAYA: Foodie Media Bhd
’s big follower base and content offerings will drive its earnings, supported by the group’s business expansion plans and positive industry outlook, analysts say.
The lifestyle digital media platform has some 46 million followers and makes its money from sponsored content, affiliate commerce, influencer marketing, campaign marketing services and short-drama production.
Kenanga Research said that the company achieved a compounded annual growth rate (CAGR) of 32% in revenue for its financial years ending Aug 31, 2022 (FY22) and FY24, primarily driven by strong growth in sponsored-content sales.
Foodie delivered two-year core earnings CAGR of 10.3% over from FY22 to FY24 despite margin pressure from higher operating costs.
“We project core earnings of RM13mil to RM14mil for FY25 and FY26, representing year-on-year (y-o-y) growth of 75% and 8%, respectively. This growth will be driven by robust revenue expansion of 57% for FY25 and 38% for FY26, and improved gross margins across all segments,” the research house said in a report on the ACE Market-bound company.
For FY26, Kenanga Research expects Foodie Media’s pre-tax profit margins to narrow y-o-y to 37% (FY25: 46%), driven primarily by a shift in segmental revenue mix from its core sponsored content toward affiliate commerce (from 7% to 18%).
“As affiliate commerce carries relatively lower gross margins, the greater contribution from this segment is expected to dilute overall group profitability.
“We have also incorporated in our forecast the group’s target of a minimum dividend payout ratio of 40% of net profit in FY26,” the research house noted.
Kenanga Research derived a fair value (FV) of 38 sen a share for Foodie Media, based on 24 times FY26 price-earnings given its resilient profile, underpinned by its near-full exposure to Malaysia’s fast-growing digital advertising market, particularly within the dominant and expanding social media segment.
TA Research has a FV of 34 sen a share on Foodie Media, with the valuation based on 23 times FY26’s core earnings per share of 1.6 sen. It forecasts the recording earnings growths of 46%, 28.6%, 28.6% to RM10.9mil, RM14.1mil and RM18.1mil for FY25, FY26, and FY27, respectively.
Foodie Media’s initial public offering aims to raise gross proceeds of RM41.4mil from the public issue of 138 million new ordinary shares and an offer for sale of 112 million shares at an offer price of 30 sen a share.
Foodie Media is scheduled to list on Bursa Malaysia on Nov 28.
