SRY - Research / Fundamentals

Stock Code: SRY
The most undervalued micro-cap stock on the ASX?

Shares on Issue: 149,617,047
Options on Issue: 7,250,009 (SRYO 2019 exp 6.5c strike price)
Market cap: $8,827,405
Board Ownership 18.8%
Board related Interests 32%
Top 20 Ownership 75.46%
Net Assets: The net assets of the Group were $7,728,532 as at 30 June 2016

Business Overview
4 different business divisions (diversified income)


Retail division is the primary business division that generates the majority of SRY's Revenue


Financial Overview

- EBITDA growth rate of 22% Year on Year
- Improving margins with new store roll outs and scaling up of business
- Strong revenue growth 18% Year on Year
- The operating profit after income tax of the Group for the year ended 30 June 2016 was $1,345,818 (2015: profit of $1,244,633).
- FY17 PE Ratio of 5.5! for a growing business
- All profits are reinvested into the business towards new store roll outs and inventory to further drive growth.

Management
Summary: experienced board (including founder) with skin in the game


Growth Opportunities & Acquisitions


Recently Announced Acquisition to be funded by Issue of Convertible Note
New Acquisition to cost $3.9m which will add $2.4m EBITDA that is VERY CHEAP.




Outlook
So according to my rough calculations once the new acquisitions are integrated SRY will be earning atleast $6,000,000 EBITDA by FY18

- Huge growing industry
- Growing middle class
- Emerging economy
- Selling reputable products
- Looking at more acquisitions in south east Asia and Australia




Feel free to comment and add anything i may have missed - This looks very undervalued to me.