KUALA LUMPUR: Focus Point Holdings Bhd's development into the food and beverage (F&B) industry is expected to sustain its profitability in the future because of the consistent business volumes from its current corporate clients and in-house Komugi outlets.
RHB Research said in a note that Focus Point staged an earnings turnaround in its F&B segment (16 per cent of FY23 sales) in the fourth quarter of 2023 (Q4 2023) after resolving the issue of over-manpower in its central kitchens.
The company targets adding at least two Komugi stores in the financial year 2024 (FY24) to the current total of 12 stores.
"The additions, together with the ramp-up in volumes by newer corporate customers, including ZUS Coffee and Cotti Coffee, should drive topline growth in the F&B business (our FY24 forecast: 13 per cent).
"It also launched the Hap&Pi frozen yogurt brand, with the first kiosk outlet opening in March," it said.
Hap&Pi is Focus Point's maiden frozen yogurt kiosk outlet in Mid Valley Megamall, Kuala Lumpur.
RHB Research noted that Focus Point's management sees positive growth momentum for its optical business so far in FY24, which made up 81 per cent of FY23 sales.
This is likely fuelled by the robust demand for eyewear products among the rising myopic population.
"In addition, the strategy to target higher-income consumer groups is also key to its resilience, with the said groups making up about 80 per cent of its customers.
"Meanwhile, we gather that the tourist-driven outlet clusters such as KLCC and Pavilion are seeing overwhelming footfalls, while the opening of a Focus Point Signature outlet in The Exchange TRX in November 2023 is also timely to capitalise on the recovery in tourist arrivals," it added.
The firm maintained "buy" on the stock with a target price of RM1.02.