Sinbon Electronics (MV $417m): Leading Cable-Connector Solutions Provider with the “Innovator’s DNA” in MAGIC Applications
Sinbon Electronics (TWSE: 3023) is Taiwan’s leading connector and cable solutions provider for transmitting signals and power for wide-ranging high-value-add end-applications and hence products have to be highly reliable, resulting in long-term customer loyalty and representing high market entry barrier. Sinbon’s product segment include: Medical Healthcare, Automotive, Green Energy, Industrial, Communications, with the acronym MAGIC as the organizing philosophy and each business unit operating autonomously. Customers are mainly global leaders. Top client is GE using Sinbon’s products in medical healthcare and green energy applications, contributing 5.1% of sales in FY14. 70% of GE’s medical equipment already uses Sinbon’s cables. Top ten clients account for <30% of sales and a well-diversified quality MNC customer base reduces the operational risk from dependence from having a single key client. New high-growth products include robotics cable products used in automated warehouses which have seen an increase in construction due to the rise in online shopping and Sinbon’s customers include Amazon and Alibaba. Sinbon’s production facilities are in Taiwan, China (Jiangsu, Dongguan and Beijing). Sinbon was founded in 1989 by chairman Joseph Wang in 1989, formerly the sales manager for AMP-Tyco (the world’s #1 connector supplier).
1) What Makes It a Wide-Moat Business?
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About The Author: Koon Boon Kee
Koon Boon is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets.
Starting his career at a boutique hedge fund in Singapore and later, at Korea’s largest mutual fund company, Koon Boon started to make headway into the investment arena. In his early successes, Koon Boon was part of the core investment decision committee which achieved 700% in returns (net of fees), in its flagship Asian fund.
A prolific writer and thought leader, Koon Boon has contributed hundreds of articles to Bamboo Innovator and BeyondProxy, an acclaimed series of subscription-based, research-intensive publications for serious investors; and is Managing Editor of the Moat Report Asia, a research service focused exclusively on highlighting undervalued wide-moat businesses in Asia. He had also presented in top banking and finance conferences in Sydney, Cape Town, HK and Beijing, as well as in the Emerging Value Summit and Wide Moat Investing Summit. His work has been featured in local and international media such as, TEDxWallStreet, Investopia, BeyondProxy, Greatinvestors.tv, Jakarta Post, Straits Times Singapore, TODAY Singapore, Business Times Singapore, as well as a publication in the BoğaziçiJournal.
With the wide occurrences of financial fraud committed by listed firms in China during 2015, Koon Boon went to further his studies, from which he saw a gap in the curriculum for accounting fraud. He went on to pioneer the first-of-its-kind course on Accounting Fraud in Asia, which is now an official course in the SMU curriculum.
Today Koon Boon is the Chief Investment Officer at 8I Holdings Limited, where he is responsible for the sustainable growth and outperformance of listed Asian equities investments in the Hidden Champions Fund.
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