Some of the advantages a small private investor has over the institutions is the ability to invest in small stocks and unusual situations. In the past, one type of unusual situation I have taken advantage of is stocks that have an unusual stock exchange listing. For example, maybe the company has significant growth opportunities in one country, but such country is different from where the stock is listed. Therefore the opportunity gets underappreciated by the market.

The stock I want to look at today is listed on the KL stock exchange, and the business is straight forward to understand in term of its history in Malaysia. Perhaps though the market is putting the stock in the more “mature” part of its growth trajectory based on its history. Whereas maybe there is an underappreciated growth opportunity if it can execute on growth plans in Vietnam and Cambodia, as well as its online strategy.

The stock I am specifically examining today is InNature (KL:5295).

Before I get stuck into it, if you are interested in other stocks with Vietnam exposures but are not listed on the Vietnam stock exchange, you can refer to my below couple of posts some months back.


Below are links to previous blog posts that discuss some Vietnamese stocks for 2022, well that are somewhat linked to Vietnam’s fortunes anyway:




Now let’s get to it. As I mentioned above, the stock I am specifically examining today is InNature (KL:5295). It trades on the KL stock exchange but the company is hoping to achieve significant growth, of which a major part of this plan is the opportunities it sees in Vietnam and Cambodia.


InNature (KL:5295) description – The principal activity is as a franchisee for The Body Shop (TBS) retailer. I won’t spend time discussing what The Body Shop does as many are familiar with the stores, if not google is your best friend there. The point at this stage to understand is that the company here has over 35 years’ experience with TBS retailing, opening their first store in KL in 1984.

They now have about 89 points of sale in Malaysia, 34 in Vietnam, and 1 in Cambodia. This was mentioned in their prospectus in 2020. By the way, the prospectus relates to them conducting an IPO to tap into the benefits of being a listed company, which can be a useful way to raise capital in the future. The IPO in early 2020 also raised capital for growth opportunities, as well as being a way for one of the major shareholders to sell half their major stake to new investors. Overall, the IPO sold shares to new investors that accounted for about 25% of what would be the new total shares on issue.

InNature (KL:5295) pe ratio – At the time of writing I see the shares around 0.62, 2022E would give a forward PE of circa 15 times.

Why am I contemplating if InNature (KL:5295) might be a good stock to buy for 2022? – I think from memory the reason this stock first popped in my head was a couple of write ups on other sites over the last year or two. I will leave a link at the end of this post for you to check them out. They give some good background to research more on the company.

Rather than cover the same things hopefully I can bring some new points from my perspective to the discussion, and also another look at things a year or so down the track.

From my perspective I look at the stock here with a few factors at least that remind me of a stock in Australia I have done well with in recent years. For what it is worth, (maybe not much), but I can also add that the females in my life in Vietnam (don’t worry it is not what you are probably thinking) looked upon TBS franchises very favourably. They can also relate to liking the fact they could visit a store for these sorts of products or also potentially buy online (I’ll get to this point a bit more shortly).

What has Shaver Shop Group Ltd (ASX:SSG) got to do with InNature (KL:5295)?

Whilst SSG is not specialising so much in skin care / perfume sort of products, it is a specialty retailer in the space of all things male and female grooming. Either way, I would suggest most customers in an ideal world in all of these areas, prefer to consume such products where they can potentially have some face-to-face contact in a bricks and mortar store (B&M). When using such products on important areas of your body, you value to some extent the customer service side of things the B&M shop presence can bring. It is also comforting to know in terms of any issues you might have in terms of refunds / credits or other disputes “just in case”.

At the same time, consumers increasingly like the online shopping experience, especially when they know what they want. Now this online experience is all that global markets seem to be focused on in recent years, but a combination of both online and B&M (i.e. Omnichannel) might be the sweet spot that markets are underappreciating.

That seems to be my experience owning SSG shares in Australia. Whilst SSG were far more of a B&M retailer a few years ago, things have evolved a lot since then. From FY17 to FY21, online sales as a percentage of total sales grew from 7.5% to 28.6%!


Let’s consider now a retailer that is almost entirely heading into the future near all online, or near all B&M.

Near All onlineYou still need a distribution mechanism as well as the online marketing reach. SSG for example with their online sales had success using spare time and space from in store workers to assist in processing / packing etc the online orders. Yet what happens if the delivery services you rely on experience some troublesome delays for various reasons? Handy for your customers if they can resort to the old way.

Getting potential new customers attention via online marketing is getting challenging. Is our attention captured as much with online ads nowadays? Can the pure online retailer get the brand to rank on google? Having a B&M presence can be a hugely powerful advertising tool in promoting your brand to generate not only in store sales, but also online sales.

Is ecommerce really the low-cost model it is made up to be if you have to spend a bucket load on online marketing? Also, a pure online retailer has to pack and distribute the goods. Let’s not forget that when a B&M retailer makes an in store sale at least they have the customer to take care of their own picking up and delivery!

I would also worry that the lack of B&M presence may hamper the ability of customers to sign up to loyalty programs, noting that InNature has had success in this regard.

Near All B&MThe pandemic has more obviously highlighted the risks of going near 100% down the B&M retailer way. Not being able to pivot to online sales would have caused havoc to such one-dimensional retailers. The kind of products SSG, or for that matter TBS sell though still lend themselves to being quite convenient for customers to buy online. A key though is to be a trusted brand and the B&M presence helps a lot in that regard.

If you are almost 100% B&M there is less flexibility in terms of evaluating how many stores to run. It also might refrain you from reaching certain geographical areas.


I think it is worth revisiting some of the structural growth drivers I suggested for Shaver Shop Group Ltd (ASX:SSG), and consider whether they might be applicable for InNature (KL:5295)?

For example:

  • Online sales growth? – long term potential is there, yes.
  • Increase in overall modern vanity about looking good, linked to growing social media use? – yes.
  • Consumers are more likely to go to specialty stores for certain niches? – yes.
  • Plenty of room for store roll outs? – yes!
  • They can be more strategic in the stores they decide to keep as online sales become a greater percentage? – long term potential there, yes.
  • Their product exclusivity range? – InNature has less control than SSG in this regard so could be a risk. However the franchisor / franchisee relationship here looks strong. The localized regional expertise of InNature is needed for execution of the strategy in untapped markets.
  • SSG is arguably not as vulnerable in an economic downturn compared with many retailers. – I would guess the InNature products might be a bit more discretionary.
  • The omnichannel format suits this niche? – yes!

I did highlight above how perhaps the product exclusivity point might be better for Shaver Shop Group than InNature (KL:5295). The latter doesn’t have so much control as they are essentially have a franchisee relationship with TBS.


Despite that though I would say InNature have stronger growth tailwinds due to their being huge room for store rollouts. (note earlier the number of Vietnam stores, and by the way their market share in Vietnam is only circa 3% whereas in Malaysia about 11%). Also the rising middle class and demographics of customers willing to buy online gives more growth potential in economies such as Vietnam and Malaysia arguably from this point in time compared with Australia / NZ in case of SSG. InNature recently saw online sale go from an almost non-existent 2.5% of all sales to 8% in the 2020 year alone. You may think this is trivial at first glance, but remember how earlier I noted SSG lifting online sales from only 8% to 29% in just 4 years.

In terms of the last paragraph, note that a key point to the IPO in the first place was indeed to capitalize on such potential. That is, the expansion opportunity in Vietnam (and Cambodia), and online potential. Specifically with online, IPO proceeds were spent on enhancing various digital platforms to become a true omnichannel retailer. They also set aside some of the IPO proceeds for a new brand (the Natura business). This business is being kicked off in Malaysia with the omnichannel strategy front and centre in mind, as they see this business model primarily about e-commerce and social commerce.


The stock can be fairly volatile, so I am basing this off the time of writing where I see it at around 0.62.

I think that 2020 earnings have obviously been clouded from the pandemic and that to sensibly ascribe a future value here 2022 estimates might be more helpful. They did however make money last year and still boast a strong balance sheet. Also it might make sense to look back at 2018 and 2019 numbers as well to try and anticipate future earnings. I note that the 2019 performance was weighed down somewhat by investing for the future, in part such as the Cambodia opportunity.

There is a lot of future uncertainty in regard to covid but it is not too brave to suggest the company can quickly get back to those 2018/19 numbers. Remember since then they have invested plenty of capex that will soon yield some benefits to flow through that we have perhaps not have time to see yet.


If you like viewing this sort of data, then here is a link for a free sign up to TIKR (they are a “freemium subscription model”, so there is tons of free information and the full access pro plan you only have to pay for if you feel comfortable in doing so).

Below screenshot from TIKR shows some of the historical numbers in MYR millions.

I have seen analyst estimates for FY22 that (taking a share price of say 0.62), put InNature on a forward P/E of around 15 times. Such forecasts imply that EPS is still comfortably lower than in 2018/19, so I don’t think the estimates are a stretch by any means. They also probably are factoring in some difficulties / uncertainty of the re-opening from covid taking place in terms of tourism etc. Therefore I could see how FY23 should improve again.

This looks to me quite an undemanding multiple considering we might be at a sweet spot stage for a retailer. That is, the point where they can easily grow earnings via store rollouts and online growth.


To learn more, you can of course google the prospectus from back last year where there is a full 411 pages of night-time reading for your entertainment!

As I promised though, some other good websites covered this stock better than I did over the last 18 months or so. In hindsight I probably should have given a shout out to these sites a few months ago when I came up with a list of good resources for investors interested in South East Asia, Vietnam markets etc.

How You Can Invest In The Body Shop of Southeast Asia (

A Love Letter to Innature Berhad (5295.KL) – The Body Shop of Malaysia/Vietnam (

Below is the list I was talking about that might be useful for investors interested in Asian stock markets.




First thing to say is I do have a position in InNature, and Shaver Shop shares for that matter,

However my track record is not that flash with the former, having paid almost mid 70s I think, so maybe take all this with a grain of salt. This is not financial advice of any kind so DYOR, I am not a financial advisor!

I rarely ever have owned Malaysian listed stocks directly so this was kind of a “feeler” position. i.e. it was probably too small to count for much, and my mindset is I probably want this stock price to fall more. If I understand it better by then at a later date I can then average down to make it a more worthwhile “normal” position size for me.

I am taking things slow also as was trying out a new broker for this trade for the first time in Boom Securities. (Many brokers don’t have access for some Asian markets for example like Malaysia, Indonesia, Thailand etc). I’ll probably cover this in a later blog post. As we can see here, sometimes stocks listed on other exchanges can be tied to the fortunes of Vietnam. Also I assume many readers who are interested in the Vietnam stock market might also be quite interested in other smaller South East Asian stock markets.

Another reason for this “feeler position” approach and blogging about it, is sometimes other investors smarter than me get in touch and tell me other angles to the analysis that I may have missed or silly biases or mistakes I have in my own thoughts. So feel free to comment accordingly in the comments are as usual! Anyway the idea is such a small position forces me to think a lot about the InNature business over the next months or year and maybe help me learn a lot more about it. As opposed to the promising story just drifting completely off my radar.


Lastly, in terms of TIKR, I have found it an excellent investing resource to use for these sorts of purposes. i.e. checking historical income numbers, balance sheet position, ratio analysis, analyst forecasts, use as stock screener etc.


TIKR have a “freemium subscription model”, so there is tons of free information and the full access pro plan you only have to pay for if you feel comfortable in doing so. If that interests you, once again here is the free link, it is as simple as just requesting access via the link below.


Of course don’t just take my views on board, I have often found that reviews / discussions on reddit threads can be less biased. I think you will however also find positive experiences there in regards to users of Tikr Terminal.

For full disclosure, if at a later date you decided to become a paid customer, I may receive a small commission from you joining up via my affiliate link above. That is no extra cost in any way to you though.

Is Vietnam a good investment?

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