ValueMax Group Limited- Growth in core businesses led to higher interim dividend

Pawnbroking segment led revenue and profit growth

ValueMax Group delivered a strong set of 1H2026 results. 

1H26 revenue rose 38.2% year-on-year to S$370.7m, led by pawnbroking segment which increased 42.7% year-on-year to S$40.1 million.  Profit attributable to shareholders increased 30.4% to S$62.6m. 

Revenue from retail and trading segment also registered a faster pace of growth, at 41.6% year-on-year, or +S$85.1 million.

Gross profit increased 23.2% to S$99.9m, although gross margin declined to 27.0% from 30.2% as the higher-margin pawnbroking business accounted for a smaller proportion of revenue. 

Despite the margin compression, profit before tax rose 30.5% to S$74.9m, supported by broad based growth. 

In addition, share of results from associates rose 41.2% to S$6.3m, mainly from its Malaysian associated companies.

At the segment level, pawnbroking profit grew the fastest, +68.1% year-on-year to S$21.9m, from S$13.0m. 

Pretax profit from Retail and trading of jewellery grew only 7.8% year-on-year and its profit share fell to 30.6% in 1H26.   In 1H26, the Retail and trading of jewellery and gold reported lower pretax margin, at 7.9%, from 10.4% in 1H 2025.   

Moneylending remained the largest profit contributor, at 35.1%, or S$26.3m, up 33.5% year-on-year   

ValueMax's integrated business model could support higher margins over time.

Finance costs remained elevated at S$15.4m, with borrowings increasing to S$1.05bn as at 30 June 2026 from S$886.3m at end-2025.

Expanding the regional network

 ValueMax has grown its Singapore footprint through selective M&A while its Malaysian associate network continues to expand. In Singapore, ValueMax accounted for around 20% of the total sector outlets. 

As at 30 June 2026, the Group's network comprised 93 outlets, comprising 50 outlets in Singapore, 32 outlets in Malaysia through its associate and 11 outlets in Indonesia through its associate.

Capital management 

ValueMax operates a balance sheet-intensive business. It is important that the management maintains a prudent and proactive approach towards capital management.

As of 30 June 2026, ValueMax held S$18.8 million in cash and bank balances, down from S$22.4 million as at 31 December 2025.   

Total assets grew 12.9% to S$1.76 billion as at 30 June 2026, largely reflecting expansion of the loan book.

Net debt/total capital was 61.0% as at 30 June 2026. Net debt/equity was 1.6x, remaining within management's 2.0x target but above Beansprout's 1.0x Opportunity Pot threshold.

As at 30 June 2026, interest-bearing loans and borrowings increased 17.8% year-to-date to S$1.06 billion. New borrowings went into funding the loan book growth.   

Equity attributable to shareholders increased to S$645.2 million, up 6.62% year-on-year.  The increase was due to retained earnings growth and exercise of the warrants in 1H26. 

In 1H26, ValueMax issued 6.85 million shares from the exercise of the warrants, at the exercise price of S$0.36 per warrant.

Net asset value per share improved 5.8% year-to-date to 68.13 cents. 

Predominantly secured, collateral-backed lending book

Over 95% of ValueMax’s loan book is secured by tangible collateral — gold, jewellery, branded watches, real estate and vehicles — which limits credit losses relative to unsecured consumer lenders. 

Of the loan book, gold accounts for 70% of the outstanding loans. 

Allowance for expected credit losses on trade receivables was S$1.89 million in 1H26, translating to a charge-off rate of 0.13%. 

ValueMax remains rated BB by Fitch Ratings. The external credit rating provides independent validation of the group's credit profile. Fitch also highlighted that ValueMax's credit cost ratio has consistently remained below 0.5%, reflecting the healthy quality of its loan book and prudent borrower selection.

Cash flow adequacy

ValueMax recorded negative cash flows from operations of S$33.8 million, due to working capital outflow. Operating cash flow turned negative as loan-book expansion absorbed working capital, with funding requirements met through additional borrowings.

ValueMax funded the working capital requirements through S$54.4m of net borrowings, alongside S$2.5m from warrant exercises.

1H26 interim dividend 1.38 cents, up 15% year-on-year ValueMax declared an interim dividend of 1.38 cents per share for 1H2026, up 15% year-on-year. The interim dividend represents a 21% payout ratio based on 1H2026 net attributable profit.  ValueMax does not have a formal dividend policy.

ValueMax has progressively raised its dividend, with total FY2025 dividends of 3.88 cents per share, equivalent to a dividend payout ratio of 35%.   

Based on the 18 August share price of S$0.96, the trailing twelve month DPS of 4.06 cents implies dividend yield at 4.2%.

Outlook

Looking ahead, management highlighted continued volatility in gold prices and a challenging competitive environment. 

Gold prices peaked at around US$5,300/oz in March 2026 before declining to around US$4,100/oz in early August. 

Structurally, as gold prices rise, buyers are keen to gain exposure.  Sellers are also keen to realise gains from the higher gold prices.  Sellers benefit from higher gold prices, which translate into higher pledge values.

Higher gold prices support larger loan amounts per pledge, lifting pawnbroking interest income. ValueMax could also make higher margins on gold trading and jewellery resale, and mark-to-market gains on the Group's own gold inventory. 

With the structural gold cycle, we would expect ValueMax's core segments to benefit in the long run.   That said, ValueMax's core lending revenue and cash flow are primarily generated from interest income.

Pawnbroking itself is a licensed, collateral-based form of consumer and small-business credit that has historically been resilient through economic cycles, as demand for short-term secured liquidity tends to rise, not fall, during periods of economic uncertainty. 

Competitors

We compare ValueMax with MoneyMax Financial Services (SGX: 5WJ), another SGX-listed pawnbroking and jewellery-retail group.

Source: Company data

Valuation

At the current price of S$0.96, ValueMax trades at a market capitalisation of S$912 million. 

With the reported 1H26 EPS at S$0.0661, the trailing twelve-month (TTM) EPS is S$0.1231, implying TTM P/E of 7.8x. This compares with an average FY2025 P/E of 16.2x for the selected pawnbroking and jewellery-retail peers.

At 1H26 NAV of S$0.6813, ValueMax is trading at 1.41x P/B.

With 1H26 dividend per share of S$0.0138, ValueMax is trading at trailing dividend yield of 4.2% (TTM dividend per share 4.06 cents). 

ValueMax is predominantly focused in Singapore.  Its close peers are MoneyMax and Aspial Lifestyle. The comparable listed in Malaysia are Pappajack and Well Chip Group.  The pawnbroking and jewellery-retail peers are trading at an average FY2025 P/E 16.2x and P/B 2.2x.

ValueMax on Beansprout’s Opportunity Pot framework

We apply Beansprout's Opportunity Pot screening framework, covering return on equity, net debt/equity and earnings momentum, to assess ValueMax’s suitability for an opportunity portfolio.

Check #1  Return on equity > 8%

Return on equity (ROE) measures how effectively a company uses shareholders’ capital to generate profits. We want to screen for companies with ROE above 8%.

We estimate the annualised 1H26 ROE as annualised 1H26 profit attributable to owners divided by average equity.

Check #2 Net debt/ equity < 1.0x

As at 30 Jun 2026, ValueMax’s net debt/ equity was 1.6x, above the 1.0x threshold set by Beansprout.

Gearing is elevated, but this is partly structural to the pawnbroking business, as borrowings are used to fund pawn loans and inventory that are backed by collateral. 

Check #3 Earnings momentum 

To assess whether a company is delivering growth in both revenue and earnings.

For 1H26, ValueMax achieved EPS growth of 28.7% year-on-year.  This is lower than the 1H26 revenue growth of 38.2% year-on-year.

What do we watch out for? 

ValueMax passed one of the three checks. ValueMax remains a dominant pawnbroker with a strong track record, although its elevated gearing and working capital requirements warrant monitoring.    

Related links:

• ValueMax Group Ltd share price and share price target
• ValueMax dividend history and forecast

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