Samsonite Ltd is the world's largest manufacturer of luggage and travel accessories. The company has nearly $4 billion in sales with contributions from Asia accounting for nearly 45% of total sales. Its brands range from Samsonite, TUMI to budget brand American Tourister. The stock has dropped over 45% thanks to a weak trading environment over the past year.
In 2018 alone it generated pre-tax profits of over $340 million with equivalent operating cash flows.
We believe its current market capitalisation of $2.9 billion grossly undervalues the business. When one considers that Samsonite itself paid nearly 3x sales ($1.8 billion) to acquire TUMI in 2016, and assuming we use even a 1.5x sales multiple, Samsonite could be worth at least double its current market value – at least in our opinion.
The share makes part of our ACATIS Asia Pacific Plus Fund.
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Photo: Siddharth Mehta-Thomas