How does yoma strategic holdings ltd make money?

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Yoma Strategic Holdings Ltd (SGX: Z59) is a leading conglomerate in Myanmar with businesses in various sectors ranging from consumer to financial services. Serge Pun founded the group in 1962.

As Yoma is a conglomerate with diverse business interests, the best way to find out how it makes money is to look into its various divisions. With Myanmar being one of the last Asian countries to open its doors to foreign investors, there has been a lot of interest from investors in gaining access to the country. One of these ways is through companies such as Yoma, as it has an established track record of operating in the country.

Here’s a brief rundown of how the group makes money for its investors. The table below shows the revenue contribution from each division.

Yoma Land

Yoma Land is the property development division of Yoma Strategic. It has one of the largest land banks in Myanmar and focuses on township projects. The group is now focusing on the sale of its City Loft units for its StarCity project and is also recognising revenue on development properties in PHE, StarCity Galaxy Towers and Yoma Central. Real estate services revenue consists of leasing revenue from the investment properties held by the group. This division makes up around 30% of total revenue.

Yoma Food and Beverage

Yoma’s F&B division consists of restaurant franchises such as KFC, the bottling of beverages, and the provision of wholesale and cold chain logistics services. The group has franchise rights to set up KFC restaurants and Auntie Anne’s outlets and also owns YKKO, one of Myanmar’s largest restaurant chains. In March 2019, the first Little Sheep Hot Pot restaurant opened its doors and became the first full-service restaurant concept for the division. The division contributed 36.4% to total revenue for Q1 2020.

Yoma Financial Services

This division is a technology-driven non-bank financial services platform spearheaded by Wave Money and Yoma Fleet. Yoma Fleet is one of Myanmar’s largest vehicle lease and rental operators, while Wave Money is a provider of mobile financial services riding on the rapid proliferation of smartphones in the country. This division made up 9.7% of the total revenue.

Yoma Motors

Yoma Motors manages the import, distribution and after-sales servicing of a comprehensive range of agricultural and construction equipment. The division also covers passenger and commercial vehicle sectors. As of 31 March 2019, there were 14 Yoma Heavy Equipment branches nationwide providing a full range of services. The number of parts distributors is expected to increase to 20 (from 16) by the end of 2019. This division took up 22.8% of total revenue.

Diverse industries with strong future growth

Yoma Strategic consists of a diverse hodgepodge of businesses that are tagging on to the rapid growth and industrialisation of Myanmar. As the country continues to receive foreign investment and prosper, Yoma should also benefit greatly from this trend.

Source: The Motley Fool

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