From Coffee Shops to Millions: Is Kimly Limited Still a Buy in 2026?

Hi Folks, welcome back to Investment Income For Life! Today, I am going back to take a look at Kimly Ltd since I sold off a significant stake on May 7, 2026 when it reached an all time high of S$0.430 per share. Interestingly, after 2.5 months, Kimly Group's share price has since dropped by 8% to the range of S$0.39 per share to S$0.395 per share and I have been slowly accumulating back the shares that I sold off previously. I will do a quick review here of its financials and fundamentals below.

1. Kimly Group Background and Key Events Over The Years

Kimly Limited is one of the largest traditional coffee shop operators in Singapore. It operates across three main business segments: Outlet Management (managing coffee shops, food courts, industrial canteens, and halal coffee shops under the Kedai Kopi brand), Food Retail (running various direct-operated food stalls, central kitchens, and restaurants), and Outlet Investment Business.

FY2021: Acquired a 75% stake in the Tenderfresh Group for S$54.0M to significantly expand its footprint into the halal F&B sector. Also acquired Tonkichi and Rive Gauche Patisserie businesses.

FY2022: Completed multiple strategic acquisitions of freehold and leasehold coffee shop properties (e.g., Clementi 380, Ang Mo Kio 347, Teck Whye 143) to secure permanent locations and expand rental income streams. Crossed the S$300Mil Revenue for the first time!

FY2023: Completed the disposal of the confectionery business (Rive Gauche Patisserie) in FY2023, recording a one-off net gain on disposal of S$2.5 million.

FY2024: Continued food stall network optimization—closing underperforming stalls while opening new strategic stalls in high-footfall heartland locations.

FY2025: Expanded its owned coffee shop portfolio through property acquisitions (e.g., Block 204 Serangoon Central, 110 Yishun Ring Road). NAV per share grew to 15.47 Singapore cents, with resilient margins despite inflationary headwinds.

FY2026: (H1 / YTD): Reported strong H1 FY2026 results with Net Profit up 10.6% YoY to S$16.4 million. Continued regular dividend payouts and announced board succession planning. Ongoing digitisation, central kitchen expansion, automation, and menu R&D to mitigate persistent labor, rental, and raw material inflationary pressures.

From above, you can see organic and inorganic growth strategies by its management over the last 5 years that shaped Kimly Group till today. 

2. Key Financial & Operational Metrics

As we can see, Kimly Group has demonstrated resilience in its revenue generation ever since its acquisition of Tenderfresh in FY2022. It has held steady in the S$310Mil-S$320Mil between FY2022 and FY2025. The resilience of heartland dining preference in Singapore has so far insulated Kimly from broader retail downswings.

Bank borrowings is now close to an impressive 1.10% leverage ratio (close to zero) following management's decision to pay off major banking loan facilities in FY2025 and FY2026. Kimly also has around S$65.1 Mil cash on hand for immediate deployment.

Based on expected 2 cents dividends for FY2026 and market price of S$0.395 per share as at 28 July 2026, the annualised dividend yield will be approximately 5.1%. Bear in mind that this is only about 75% of earnings payout with 25% kept in retained earnings.  

Parting Thoughts

On May 7, 2026, DBS Group Research has released a targeted price of S$0.52 per share based on a blend valuation techniques of 4% forward yield discounted cashflow and 18 times multiple of PE ratio benchmarked to existing F&B retail. With the price dropping back to below S$0.40 per share after the sudden rally from the release of the analyst report, I personally thought that it is a good time to accumulate after I sold off the bulk of them during the earlier sudden rally in May 2026.

Sold Off Kimly Limited To Take Advantage of DBS Analyst Report Published in May 2026 with Target Price of S$0.52 Per Share.

Hi Folks, today is not too bad a day. While working in office, I saw a notification from my Tiger Brokers App with regard to a sudden surge in share price of Kimly Ltd rising to as high as S$0.430 per share in the afternoon today (May 7, 2026). A quick check on SGX announcement showed nothing much happening to its business in May 2026. The biggest catalyst seems to be a new DBS research report released today that initiated coverage with a “BUY” call and a target price of S$0.52 per share.

1. DBS Analyst Report on May 7, 2026

The report highlighted the following on Kimly Ltd:

(i) strong net cash position,

(ii) stable coffeeshop cash flow,

(iii) potential industry consolidation,

(iv) recurring dividends and 

(v) gradual outlet expansion/acquisition.

Medium size counters often faced poor liquidity trading issue and thus exposes Kimly Ltd to the sudden interest and spike in demand upon the release of the DBS Analyst report.

2. Selling off Most of my Kimly Ltd Stakes While Retaining Some For Further Long Term Appreciation

I am letting go part of my Kimly stakes from the sudden surge in price for Kimly Ltd to take advantage of this opportunity for re-deployment. Kimly was at S$0.395 per share as at yesterday (May 6, 2026). While DBS analyst put up an optimistic targeted price of S$0.52 per share for Kimly, I am locking in an immediate realisation of the 30% capital appreciation at S$0.42 per share and have sold off 27,800 shares today while retaining another 20,000 shares for the long term.  

Parting Thoughts

Will wait a few more days to study the current market on which other potential stock to buy with the realised funds from my investment in Kimly Ltd last year (May 2025). I guess it is not too bad to be making a 30% capital gain in less than 1 year of investment which is 6 years worth of dividends assuming 5% dividend yield per annum. 

Ok Folks, that's all from me today....have a great week ahead! 

Investment Portfolios Updates (30 December 2024) - Net Investment of S$709K and Projected Annualised Passive Income of S$47K.

It has been 3 months since my last update of investment portfolios on 27 September 2024. The rally in S-REITs and China stocks fizzled out quickly in a short span and it seems that we are back to square one. Overall, real estate related investment assets still make up about 60% of my combined portfolios. I have continued to work on diversifying away from real estate related businesses and have continued investing into mostly bond related unit trusts via Endowus as well as buying into F&B retail business of Kimly Group. 

1. Portfolio 1- Stocks held in SGX Central Depository 
(Note: This portfolio is designed to provide immediate dividends for use as it is under my own CDP account and the dividends credited goes directly to my bank account.)

Main changes here as aforesaid mentioned is the addition of Kimly F&B retail group here. I have also took part in the preferential rights issue for Keppel DC REIT. I retained the additional units of KDC in my SGX account while selling off the additional units in my Margin Trustee account- see below.

2. Portfolio 2- Margin purchased securities

(Note: My margin purchased securities has grown to a sufficient scale to sustain itself and can pay off annual financing charges as well as to gradually pay down the margin loan through dividends generated.) 

Took part in the preferential rights issue for Keppel DC REIT and then sold off all the 4,000 additional units in my Margin Trustee account and bought 5,000 units of Mapletree Pan Asia Commercial Trust. 

In addition, I also invested into the Bank of China as well as ICBC Bank here. 

3. Portfolio 3 (with Tiger Brokers and MooMoo) 

(Venture into higher risk as well as capital growth stocks here)

Bought into additional units of Oceanus here as well as ICBC (Bank). 

4. Portfolio 4 (Endowus Unit Trusts & Other Investments)

The public and government objection to the Allianz acquistion of Income Ltd means that the 300% capital gain deal fell into the drain. Worst still, the suspension of public trading of Income Ltd shares on Alta platform as at 17 Octobet 2024 is a double whammy due to the fallout from the Allianz deal. Income Ltd management team screwed up big time on this one.

I have also decided to start drawing down the dividends and distribution from Portfolio 4 going forward.

Summary

I sincerely hope that 2025 will be a better year and that the run-away inflation has been tamed and that interest rate will remain as it is else any increase in rates will once again batter REITs and bonds asset prices to death. 

Would also like to take this opportunity to wish all a Happy New Year and may we all prosper together in 2025! :)😎

Investing into "The Flavours of Life"- Kimly F&B Retail Group.

Since REITs prices have rallied somewhat over the past few days over Christmas period, I decided against investing more into Mapletree Pan Asia Commercial Trust and Link REIT. Instead, I have decided to invest into the F&B group with the "Flavours of Life" slogan- Kimly. Strangely, Kimly Group 's share price has fallen dramatically off its peak of S$0.436 per share back in 2021 while its business have expanded from 148 F&B outlets to 191 F&B outlets from FY2021 to FY2024- see Retail Footprint for details.

1.Retail Footprint

2. Financial Outlook and Dividends Payout + EPS Thoughts

2.1 Strong Balance Sheet with Loads of Hard Cash

I am extremely impressed with the S$98.5Mil of cash on Kimly's balance sheet. Cash is King. This huge pile of cash can be used for immediate business expansion as well as immediate paydown of S$17Mil of short term and long term bank loans during emergency liqudity crunch time.

2.2 Dividends Payout

With a dividend payout of 2 cents for FY2024 and a EPS of 2.55 cents, this means  a payout ratio of almost 80% while retaining 20% earnings in the business. At the market trading price of S$0.325 per share as at 26 December 2024, this represented an extremely attractive dividend yield of 6.15%. 

2.3 EPS on Higher Side- But Need to Consider Room For Growth

Also, Kimly's PE ratio based on EPS of 2.55 cents is about 12.94 times. F&B industry in Singapore (based on data from Simply Wall Street on Singapore Industry) range from PE of 8 to 10 so apparently 12.94 times seems a tad high on SGX. Nevertheless, I thought that its Halal "Tender Best" sub-branded restaturant has lots of room to drive growth & profitability for the future. 

Interestingly, its share price has remained in the S$0.310 to S$0.325 range despite the announcement of its full year financial results and 1 cent final dividends declared on 26 November 2024. Ex-dividend will be on 4 Februray 2025 (Tuesday) and payout date on 14 Februrary 2025 (Friday).

3. Possible Downside Risks

Of course, not all is entirely eventful for Kimly and its management team over the past few years as well as recently. There are a couple of serious downside risks:

3.1 Pokka Deal & Conflict of Interest in 2022

In February 2022, 2 former directors of coffee shop operator Kimly were fined for their role in failing to notify the Singapore Exchange (SGX) that Kimly's acquisition of drinks company Asian Story Corporation (ASC) involved a conflict of interest. This unfortunate incident also led to the disqualifcation of the above mentioned officers of the Group to act as director for 5 years.

3.2 Illquid Stocks As Most of the Share Capital Owned by only a Few Substantial Individual Holders.

The stocks (50%+) are held in the hands of 3 indviduals. General public holds the remainder. Hence trading of this counter is not very liquid. It maybe tought to sell off the stocks during unforseen situation.

3.3 The Competition is Intense in F&B.

There are many rival coffeeshop businesses in operations in Singapore. There are also other F&B operators. I am not sure why some folks think that Kimly is a relatively defensive business with resilient cashflow. The fact is that it is extremely price sensitive and  not all costs can be passed on immediately to customers. For example, we have seen the impact of the recent high inflation on Kimly Group's financial performance. There were also various closure of non-profitable stalls and resturants by Kimly over the past few years. 

3.4 Resignation of Financial Controller of Kimly Group announced on 27 November 2024.

Personally, the resignation of the Head of Finance & Accounting is a downside for me that signals possible other issues internally albeit the standard crafting of the "personnel left to pursue other personal and career opportunities". The Financial Controller joined Kimly in 2021 and then left 3 years later.

It is also strange that the Senior Finance Manager is left to hold the fort and that the Group did not look out for experienced replacement CFOs/Financial Controllers to take over.  

Parting Thoughts

For diversification away from my REITs heavy portfolios, I have decided to invest a small amount (20,000 shares) into Kimly Group given that it has demostrated stable growth in its F&B businesses. While challenges such as intense competition, inflation and cost pressures present great business risks to its profitability, I think that Kimly's senior management is experienced enough to steer the group forward given their sharp business acumen and historical track record.