Is White Horse a value trap?

White Horse Berhad is the leading tile manufacturer in Malaysia that is currently trading below its Graham Net Net. The Graham Net Net is a short hand for its liquidation value.

Is this a value trap? I don’t think so. Ceramic tile is not a sunset product.

White Horse Malaysian business has declined due to the soft property market. I expect the Group to return to profitability when the property market recovers. There is growing global demand and hence export potential. My estimate is that this will take another 2 to 3 years before we see any results.

The Group is financially strong and not burning cash giving it time to outlast the economic downturn.