Kawan Food has a consistent buying force.

Since our coverage started on Kawan, we found that there is some persisted buying forces on the stocks. The closing price has reached RM 1.220 and warrant advanced to RM 0.220 as closing.

We do not know whether they are funds, share buy back or owners increasing their position. We feel that Kawan fair value should be traded at 15 times of its PE. On the back of consistent profit growth, right industry as it linked to agricultural down stream and future growth prospect in setting up new halal plant.

We feel that a quarter of profit at RM 5 cents will give Kawan 15 times PE at RM 3.00. Thus, we raise strong buy of Kawan below RM 1.50.