TICKER CHZ.SI
ISIN SG1DH2000003
Market cap. SGD
726,987,604
Shs outstanding 989,098,781

website

HRnetGroup Limited, an investment holding company, engages in the recruitment and staffing business in Singapore, Hong Kong, Taiwan, the People’s Republic of China, Japan, South Korea, Malaysia, Thailand, and Indonesia. The company operates through Professional Recruitment, Flexible Staffing, and Others segments. It offers personnel recruitment and human resource (HR) related services; employment, recruitment, and personnel placement agency services; executive search services; permanent recruitment, payroll, and temporary and contracted staffing services; and executive and management recruitment, as well as management consultancy services. The company also provides outsourcing of HR related services; labor dispatch services; and HR functions management services. In addition, it is involved in private employees procurement agency business licensing activities. The company serves IT and tech, retail and consumer, healthcare life science, manufacturing, financial and insurance, government, and other industries. It provides its services under the HRnet One, Recruit Express, PeopleSearch, SearchAsia, RecruitFirst, PeopleFirst, RecruitLegal, YesPay!, HRnetRimbun, and REForce brands. The company was founded in 1992 and is headquartered in Singapore. HRnetGroup Limited is a subsidiary of SIMCO Ltd.

Strategy:

Return at exit: 0.7%
Market underperformance amid valuation concerns
• Rotated out due to relative underperformance compared to alternative opportunities in our model’s universe. • HRnetGroup’s fundamentals show concerning trends: EBITDA declining by ~13%, minimal revenue growth of just 1.2%, and shrinking profit margins from 24% to 21.6%. • Recent financial results indicate persistent challenges, with FY2024 showing revenue down 2.0% and net profit after tax dropping significantly by 29.9%. • Despite these headwinds, the stock trades at 99% of its 52-week high, raising valuation concerns with a P/E of 14.2 and negative PEG ratio (-1.37). • Company maintains some strengths: healthy 5.5% dividend yield, solid 10.8% return on assets, and price below analyst fair value estimates of 0.78 SGD. • This change reflects portfolio rotation, not a sell signal.
Strategies