Swot Analysis Of Padini Holding Berhad

SWOT ANALYSIS

Strength

Padini Holding Berhad is not only selling single product, but also contain a few different brands of clothing products. For example, Padini Holding Berhad is included Vincci, SEED, Mikihouse and etc (The fifth person, 2017). That’s why Padini Holding Berhad almost covers the clothing market in Malaysia for low and medium income consumer. Padini Holding Berhad consists a lot of outlets in Malaysia and around the world. We have nine brands of our branded family and retail outlets in 330 independent, franchise and counter outlets in Malaysia and around the world. Brunei, Cambodia, Egypt, Indonesia, Kuwait, Morocco, Myanmar, Oman, Pakistan, the Philippines, Qatar, Saudi Arabia, Syria, Thailand and the United Arab Emirates

This is because the management do not control their production costs well as the costs of goods sold is getting higher every year. This also may due to the issue that competition in the industry are increases every year therefore they lose the competitive advantage in products costs and cause the costs getting higher. Operating profit margin and net profit margin have a fluctuating ratio from year 2015 to 2016. This shown that it is not consistent and strong enough as they are weak at generating sales into shareholder’s earnings and management-controlled costs. Furthermore, total return on assets increasing every year which is a good sign to the company as the profits and total assets of the company are increasing gradually every year. Since the ratio is increasing every year, this shown that the company could generate earnings by using its assets efficiently. In the return on stockholder’s equity ratio, we can see that it is having fluctuation over the 3 years, but it is having high increases in year 2016 then following by low decreases in year 2017. This is due to the issue that the company are inefficient to generate profits by using less capital and management are not arrange the shareholder’s capital

In the financial analysis that we have done, we only find out the current ratio of Padini Holdings Berhad. Current ratio is used to measure whether the company can cover their current liabilities by using all its current assets when the event of liquidation is occurred. If the current ratio is more than 1.00 which means that the company can settle its current liabilities, in contrary, the company is unable to settle its current liabilities if the current ratio is less than 1.00. Based on the financial analysis, the current ratio of Padini is unsteady over the 3 years but the ratio is maintaining below 1.00 over the 3 years which means that the management controlled the assets and liabilities very well to prevent cash squeeze problem and unable to settle the current liabilities when the event of liquidation