M1 and Healthway Analysis

1. Executive Summary

This report aims to evaluate the performance and assess the value of publicly listed firms using business valuation and analysis. At the start of the project, we hope to achieve an average returns of about 10% effective annual rate for the investment period. Our investment philosophy is to invest in 2 companies, one which is a stable firm, and one which is a small capitalization stock to take advantage of any growth. Hence, we have identified two reputable firms in unrelated industries to diversify our risks. Our initial portfolio consists of M1 (60%) and HMC Medical Corp (40%).

We are optimistic about the growth of the companies in Singapore. M1, a company listed on the SGX mainboard, provides stable returns. We chose M1 because of its relatively stable prices and high dividend payout ratio. Healthway Medical Corporation Limited, a company listed on Catalist, provides opportunities for high growth. Healthway Medical is a small market capitalization share and the volatility of the share price is a good candidate for growth share. We made use of their annual reports and various online databases to obtain information about their financial information.

Our analysis covers the strategic analysis, competitive strategy analysis, accounting analysis and prospective analysis. Following analysis of the companies, there were no significant changes to our investment mandate. We recommend a buy signal for both our stocks with a target price of $2.65 and $0.18 respectively. At the end of the investment period, we obtained a loss of $2869.83 representing a loss of 2.67% of the initial portfolio. However, we are confident that the temporal loss of value will be recovered in the near future baring the risks that are discussed in this report.

2. M1 LIMITED

2.1 Company Background: M1 is an integrated communications services provider, offering fixed, mobile broadband; voice and data communication services and value-added services.

2.2 Industry Analysis...