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| 12-Aug-2009 15:22 |
Midas
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Midas
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WoW! Expanding for a golden future Target price raised to S$1.10, maintain BUY. We raise our target price for Midas to S$1.10, based on 20x FY10 earnings, at a 20% discount to its HK-listed train and parts manufacturing peers. 20x PE is also undemanding against Midas’ 25% EPS CAGR over FY08-FY12, which translates to 0.8x PEG. • We paid a visit to Midas’ aluminium extrusion plants in Jilin and to NPRT’s plant in Nanjing • NPRT is ramping up production to meet its delivery schedule whilst Midas’ core business is expanding aggressively to meet firm demand • Strong order books underpin earnings visibility with potential for much more contract wins Source: Bloomberg, DBS Vickers 12Aug2009 |
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| 08-Aug-2009 19:28 |
Midas
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Midas
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Peer:(As at 7Aug09) Ratios For Midas Holdings Limited (SGX-listed), Closed SGD$0.825 Valuation Ratios Price/Earnings 20.79 Price/Sales 4.82 Price/Book 3.32 Price/Cash Flow 17.11 Profitability Ratios (%) Gross Margin 36.57 Operating Margin 30.25 Net Profit Margin 24.00 VS Ratios For Zhuzhou CSR Times Electric Co., Ltd. (HK-listed code:3898), Closed HKD$13.26 Valuation Ratios Price/Earnings 30.01 Price/Sales 5.98 Price/Book 3.72 Price/Cash Flow 25.95 Profitability Ratios (%) Gross Margin 37.14 Operating Margin 23.11 Net Profit Margin 19.98 |
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| 08-Aug-2009 01:09 |
Hyflux
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Hyflux
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(OCBC 7Aug2009) Raising fair value to S$2.96. Maintain BUY. Due to the better-than-expected recovery in gross margins, we have bumped up our FY09 net profit estimates by 17.9% (FY10 by 17.5%), while keeping our revenue estimates unchanged. This in turn raises our fair value from S$2.52 to S$2.96, still based on 20x blended FY09/FY10 EPS. Resurgent 2Q09 results. Hyflux Ltd posted its 2Q09 results last night, where revenue jumped 24.4% YoY to S$134.5m, while net profit climbed 14.7% to S$25.9m. The better performance was due to the progressive completion of higher-valued projects, especially from the MENA region, with continued active project execution driving improved gross profit margins. More importantly on a sequential basis, revenue shot up 52.4%, while earnings surged >400%, but this comes as no surprise as we had already noted the seasonality factor in our 1Q09 report (also see Exhibit 1). And for 1H09, revenue climbed 12.7% to S$222.7m, meeting 36.4% of our FY09 forecast, while net profit rose 9.6% to S$31.0m, or 50.4% of full-year estimate. |
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| 07-Aug-2009 23:35 |
Midas
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Midas
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I guess Midas will benefit more from China stimulus package! News From Fortune: China's amazing new bullet train This year Beijing will spend $50 billion on what will soon be the world's biggest high-speed train system. Here's how it works. ............according to Beijing's Railroad Ministry, 110,000 were laboring on a single line, the Beijing-Shanghai route, at the beginning of 2009 -- who are building one of the largest infrastructure projects in history: a nationwide high-speed passenger rail network that, once completed, will be the largest, fastest, and most technologically sophisticated in the world. Creating a rail system in a country of 1.3 billion people guarantees that the scale will be gargantuan. Almost 16,000 miles of new track will have been laid when the build-out is done in 2020. China will consume about 117 million tons of concrete just to construct the buttresses on which the tracks will be carried. The total amount of rolled steel on the Beijing-to-Shanghai line alone would be enough to construct 120 copies of the "Bird's Nest" -- the iconic Olympic stadium in Beijing. The top speed on trains that will run from Beijing to Shanghai will approach 220 miles an hour. Last year passengers in China made 1.4 billion rail journeys, and Chinese railroad officials expect that in a nation whose major cities are already choked with traffic, the figure could easily double over the next decade..............(Fortune Magazine) http://money.cnn.com/2009/08/03/news/international/china_high_speed_bullet_train.fortune/ |
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| 31-Jul-2009 15:38 |
Midas
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Midas
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Goodness!!! WoW! Long-term prospects of Midas: Midas (current price $0.88) still have 81.81% potential profit margin based on new TP $1.60 from DBS Vickers |
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| 29-Jul-2009 12:19 |
China XLX Fert
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China XLX Fertiliser Limited
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Speculation of dual-listing in HK Seeking dual-listing in HK. China XLX announced this morning that the Group is proposing a dual-listing in HK. This is still at very preliminary stage with no details . The proposal is subject to the approval of Hong Kong Stock Exchange and the approval of the Shareholders. Valuation gap should be narrowed in the event of successful dual-listing. Historically, CXLX has been trading at a discount of 25%-35% to its HK peers. The dual-listing should positively impact CXLX's valuation in Singapore. We believe the valuation gap between CXLX and its closet peer in HK, China Bluechem would be narrowed. However, a marginal discount should remain, in view of China Bluchem's much larger market capitalisation and SOE premium. Results preview and Outlook Fundamentals remain weak. The dual-listing is deemed to be a positive development for CXLX, in terms of valuation. However, the outlook of the company remains gloomy. The issue of urea oversupply is unlikely to be resolved this year and fluctuations in coal cost could further dampen the earnings of the company. Maintain FV, TP raised to S$0.44. Share price has run ahead on speculation of the dual-listing in HK, where discussion is still preliminary at this point. We roll over our valuation to blended FY09/10 earnings and TP is raised to S$0.44(Prev: S$0.37), still pegged to 9x PE. In the event of a successful dual-listing, we believe the fair value should be adjusted to S$0.53 at 11x PE, which is a 10% discount to its closet peer, China Bluechem. We advise investors to sell into strength. (DBS 28/Jul/09) |
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| 29-Jul-2009 12:07 |
CharteredSC
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Why such low volume?
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Healthy sequential growth expected in 3Q09 Reiterate SELL. OCBC 27/Jul/2009 We have revised our FY09 sales forecast upwards by 7.7% to take into account of the better outlook. While it is without doubt that Chartered has been making significant improvements in its business operations and financial position, we believe that the group may only reach its breakeven utilization of 75% in 2Q10, as opposed to 4Q09 as expected by management. At current price, the stock also seems to have run ahead of its fundamentals. As such, we keep our SELL rating for now, but revise our fair value upwards from S$1.40 to S$1.46 (0.6x FY09F NTA) on better earnings forecasts. 2Q09 results ahead of expectations. Chartered Semiconductor reported its 2Q09 results last Friday. Revenue fell 23.7% YoY (+43.1% QoQ) to US$349.0m but was slightly ahead of our expectation of US$340.4m and its revised guidance of US$338-348m. Net loss attributable to Chartered, on the other hand, registered US$39.4m, reversing its profit of US$43.4m in 2Q08 (US$98.8m loss in 1Q09), but similarly exceeded our estimate of US$50.7m loss and its guidance of US$45-53m loss. Key variances between our quarterly forecasts and the results came mainly from higher revenue, a US$18m favorable impact from a change in depreciation policy (effective from 4Q08), stronger contribution from associates, and a US$8.8m tax benefit from recognition of deferred tax assets for Fab 3E's unabsorbed wear-and-tear allowances and tax losses. For 1H09, we note that revenue totaled US$593.0m (-29.9% YoY, -27.3% HoH), making up 46.9% of our FY09 sales projections, while net loss reached US$138.2m (2Q08: US$45.8m profit, 1Q09: US$138.4m loss), or 55.6% of our full-year loss figure. Communications and computer sectors to drive 3Q09 growth. As Chartered progresses into 3Q09, it is seeing healthy sequential growth in its business, driven mainly by the communications sector and computer sector to a lesser extent. Based on the current outlook, the group is expecting its 3Q09 revenue to hit US$382-394m (up 9.5-12.9% QoQ) and its net loss to narrow to US$17-27m. Its utilization rate, likewise, is expected to improve to 67-73% from 60% in 2Q09. In order to capitalize on the momentum seen in its leading-edge technologies and customer engagements, Chartered is also increasing its FY09 capex to US$500m from US$375m as guided previously. We understand that this additional capex will be used to increase Fab 7's capacity to 31,000 12-inch wafers per month by 1Q10, although it is not expected to add significant capacity this year. |
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| 27-Jul-2009 00:18 |
Midas
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Midas
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When Midas breakout from key resistance suggest further upside! (DBS 23/Jun/09) Maintain BUY, target price raised to S$0.93. We raise our target price by rolling over our valuation multiple of 15x PE (unchanged) to FY10 earnings (from FY09//10) as Midas’ earnings visibility has improved substantially following these contract wins. HK-listed peers, CSR Zhuzhou and China South Locomotive, are trading at over 20x earnings. Peer: Midas Holdings Limited (SGX-listed), are trading at only PE 20.xx http://uk.reuters.com/business/quotes/ratios?symbol=MIDA.SI VS Zhuzhou CSR Times Electric Co., Ltd. (HK-listed code:3898), are trading at over PE 27.xx http://uk.reuters.com/business/quotes/ratios?symbol=3898.HK |
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| 27-Jul-2009 00:10 |
Keppel
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keppel Corp
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Margin enhancement • 1H09 earnings were above our expectation, due to better contribution from O&M and property. • 15 Scents per share interim dividend for 1H09. • Revise FY09 net profit upwards by 24%, but reduce FY10 net profit by 14%. • Maintain FULLY VALUED, but target price is adjusted upwards to S$6.96. Raised target price (TP). We raise our TP to S$6.96, due to the re-pegging of listed associate companies’ market prices, higher book value (including SPC) as of 1H09, and higher selling price for Keppel Bay projects. Maintain FULLY VALUED, with 11% downside to TP. DBS 24Jul2009 |
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| 27-Jul-2009 00:06 |
Pan Hong
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Tapping the markets in Southern China
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Recovering property sector sweetened by new acquisition, reiterate BUY. We met up with Pan Hong Property Group’s (Pan Hong) CEO to discuss its strategy ahead and recent acquisition of a warehousing facility in Shanghai’s strategic petrochemical port. Management is now seeing more concrete signs of recovery and improved buying sentiments in several lower tier cities, best evidenced by its 256 units sold in 52 days. Aside from business diversification, management is looking at the recent acquisition as an additional stream of recurring income. Looking forward, management intends to focus its business on lower tier cities and increase recurring income streams. At present, its landbank remains massive at 2.4m sqm across five cities, which should ensure healthy medium-long term profits. Balance sheet remains strong with net gearing of 0.17x. Our new fair value of S$0.50 (S$0.43 previously) assumes new achieved prices for Hua Cui Ting Yuan, pegged at a lower 20% (30% previously) discount to RNAV due to more concrete signs of a recovering property sector. DMG 24Jul2009 |
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| 22-Jul-2009 14:44 |
Meiban Gp
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UPSWING @ 3rd Elliot wave .
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3Q09 would be the strongest quarter, based on continued seasonal ramp for key customers. Meiban is a key printer enclosure supplier for HP and contract manufacturer for Dyson vacuum cleaner. Our checks indicated that capacity utilization is running as high as 90%, compared to 70-75% in Q1..... Raised forecast, Upgrade to Buy. We have revised FY09 profit forecast to S$13m for improved orderflows and better than expected margin seen in Q1 results. Our new target price is S$0.35, based on 8x FY09/10 blended earnings. Stock is compelling at 6x P/E and only 0.6x book with an attractive yield of 8%. Upgrade to Buy. DBS 22/7/09 |
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| 18-Jul-2009 19:38 |
Midas
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Midas
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Recommendation: BUY^
Average new Target Price: $0.96*
OCBC, 17/Jul/09, Maintain BUY^. Fair value is raised to S$0.93*
Don't miss this train; we have not factored in more possible wins from NPRT:
With the upcoming 2nd tender and its demonstrated contract win success in the 1st tender, the potential for better earnings and visibility notches the investment profile of Midas up yet again. The dilution is partially buffered by new capacity coming online in 2H10. Our fair value is raised to S$0.93 (prev. S$0.90) on a higher 18x (prev. 16x) FY10F peg. We have not factored in more possible wins from Nanjing Puzhen Rail Transport (NPRT).
DMG, 17/Jul/09, Maintain BUY^. Adjust our target price to S$0.97*
Recommendation:
EPS dilution would result from this share placement exercise. Currently valued at 22.0x FY09F P/E & 13.8x FY10F P/E and assuming that Midas trades up to the 35% discount of its China-listed peers (derived from applying the P/E of the Singapore market which trades at a 35% discount to the Shanghai Composite Index) at 20.1x blended P/E FY09/10, we maintain our BUY recommendation and adjust our target price to S$0.97 (from
S$1.04 previously).
CIMB, 17/Jul/09, Maintain BUY^. Target price has been trimmed to S$0.87*
Forecasts raised by 5-24% for FY10-11:
With the anticipated capacity expansion and contract awards, we raise our forecasts for FY10-11 by 5-24%. However, our DCF-derived target price has been trimmed to S$0.87 from S$0.88 (unchanged WACC of 9.5%), taking into account the profit growth as well as EPS dilution. This translates to 16x CY10 P/E, slightly above valuations for China-based peers. As we highlighted in our note on 16 Jul 09, we continue to advise caution against overpricing Midas on the back of the current market euphoria. Maintain Trading Buy.
KIM ENG, 17/Jul/09, Maintain BUY^. New TP of $1.10*
More rabbits in the hat:
With extrusion capacity largely accounted for, we now believe further upside to our earnings estimate will likely come from more downstream fabrication contracts, NPRT (Nanjing SR Puzhen Rail Transport Co) contracts and possible addition of third and fourth extrusion lines. We have adjusted our FY10 net earnings by 10 per cent and derive a new TP of $1.10, based on 18x FY10 PE. Maintain BUY
DBS, 23/Jun/09, Maintain BUY^. Target price raised to S$0.93*
Huge contract wins bolster earnings visibility:
We raise our target price by rolling over our valuation multiple of 15x PE (unchanged) to FY10 earnings (from FY09//10) as Midas’ earnings visibility has improved substantially following these contract wins. HK-listed peers, CSR Zhuzhou and China South Locomotive, are trading at over 20x earnings. Maintain BUY
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| 17-Jul-2009 16:48 |
Midas
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Midas
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OCBC By Kelly Chia Fri, 17 Jul 2009, 09:55:25 SGT Our fair value is raised to S$0.93 (prev. S$0.90) on a higher 18x (prev. 16x) FY10F peg. We have not factored in more possible wins from Nanjing Puzhen Rail Transport (NPRT). Maintain BUY. Summary: Midas Holdings (Midas) has opted for the equity route to fund two new production lines. Midas will be issuing 100m new shares with a 20m top up option at S$0.755/share. We are assuming the full 120m to be placed out in view of the positive long-term prospects of the company. This translates to 14.2% of the current issued capital. The urgency in getting its two new lines up is primarily to be in the running to obtain a sizable chunk of jobs from the Ministry of Railway’s (MOR) ongoing 2nd tender. Contract awards to component manufacturers like Midas will likely be in Oct – Dec 09. The two new lines will be located with its upcoming 3rd line and should be working in 3Q10 and 4Q10. We believe that more machinery for downstream processes will also be purchased. The potential for better earnings and visibility notches the investment profile of Midas up yet again. The dilution is partially buffered by new capacity coming online in 2H10. |
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| 17-Jul-2009 12:30 |
Midas
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Midas
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Midas is pleased to announce that it has successfully raised gross proceeds of S$90.6 million through a private placement of 120 million new ordinary shares (the "Placement Shares"), representing 14.2% of the existing share capital of the Company, at the price of S$0.755 per share. Net proceeds from the placement amounted to approximately S$89.4 million, after deducting commission and estimated expenses incurred in connection with the placement. The Group intends to utilise approximately S$81.0 million for the expansion of its aluminium alloy production capacity (including the purchase of two new production lines), with the balance of approximately S$8.4 million to be utilised for general corporate and working capital requirements. What is Private placement? Private placement financing is another unique method for a business to obtain capital, and provide cash infusions at the same time to be used to increase sales, or to cover the cost of new equipment or software. As with other sources of financing, private placement has to be done properly to ensure your business get the most benefit possible. Private placement is a perfect source of financing for companies which are growing. Private placement is the investment of money from private investors who granted shares in the company. Through the purchasing of stocks or bonds a company will obtain the capital they need to continue expanding. With a private placement the company selling their stocks and bonds most of the time does not have to register with the Securities Exchange Commission. This reduces the amount of extra work involved, or needed. It is the most popular form of Regulation D non-public investing. Another benefit is that private placement is cheaper most of the time than actually taking a company public. Other benefits of private placement include: • Flexible financing needs for companies of all sizes including capital from 100 thousand up to the millions. • Investors don’t look for quick profits and high returns on their investments. They are ok with a return of 10 to 20%. • Capital can be raised much faster. • The cost of obtaining the capital is quite a bit less. |
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| 17-Jul-2009 10:03 |
COSCO SHP SG
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CoscoCorp
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Cosco Corporation Family Ties Broken KIM ENG 16/Jul/2009: Slashing forecasts, maintain SELL We are therefore cutting our net profit forecast for FY10 by 40% and FY11 by 50%, to S$154.3m and S$141.5m respectively. We are also factoring lower margins from cost overruns, which see our FY09 forecast cut by a further 28% to S$185.4m. With earnings expected to be volatile, we had pegged fair value at 1.5x price-to-book, or S$0.81, which remains unchanged. Our SELL recommendation is also maintained. 8 ships cancelled by related companies Cosco has announced a rash of new order cancellations, this time more severe – the latest round comes from related companies. China Ocean Shipping and related companies have rescheduled the delivery of 3 57,000 dwt bulk carriers and outright cancelled 8 bulk carriers. The total value of the cancelled orders is S$298.7m, or about 5% of its total bulk carrier orderbook. In the dark about latest rescheduling Cosco says that the three rescheduled vessels will be delivered between August 2009 and October 2009 instead of the planned delivery of between June and December 2008. Noting that the time of the original delivery has is already way past, we find it discomforting that Cosco had not made indication of this rescheduling prior to this. Cosco says that the buyers are not pursuing late delivery claims. As for the cancellations, Cosco will refund the deposits paid for the ships. The floodgate for bad news stays open Prior to this cancellation, interested parties transactions were worth S$579.8m. The cancellation effectively halves that exposure. We estimate Cosco’s orderbook at around US$6.5b Last week, Cosco also announced that it will delay the delivery of 8 bulk carriers (two 79,500 dwt and six 92,500 dwt bulk carriers) to two European ship owners by between 4-9 months. Cancellations exceeding our already negative assumptions We had been expecting even more delays and/or cancellations for Cosco, given the difficult market conditions for bulk carriers; however, these latest cancellations have exceeded our assumptions. While Cosco says that the latest cancellations are not expected to have a significant impact to earnings in 2009, they will surely be felt from FY10 onwards. |
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| 17-Jul-2009 09:56 |
COSCO SHP SG
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CoscoCorp
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AmResearch Sdn Bhd: 16/Jul/09 We maintain our BUY call on Cosco with fair value of S$1.50/share, based on a FY10F PE of 17x, which implies a 15% discount to Cosco’s three-year average PE of 20x. Cosco Corp (S) Ltd (Cosco) has cancelled and rescheduled shipbuilding contracts with related companies - Qingdao Ocean Shipping Co, Ltd. (Qingdao) and Cosco (Hong Kong) Shipping Co, Ltd (Cosco HK). This involves rescheduling delivery of three units of bulk carriers of 57,000 DWT (deadweight tonne) each and cancelling US$299mil in contracts to construct eight units of bulk carriers of 57,000 DWT each. Quigdao and Cosco HK are subsidiaries of China Cosco Holdings Company Limited, which has a 53% stake in Cosco. Postponement of the delivery for the three bulk carriers does not surprise since construction had already been delayed by the global financial crisis. These contracts, entered into on 6 December 2006, have been postponed by up to a year from 20 June 2008-10 December 2008 to 15 August 2009-31 October 2009. Construction has not commenced for the eight vessels being cancelled. We estimate that Cosco’s total order cancellations has risen from US$200mil to US$500mil - since late last year. For orders from Cosco’s related companies, outstanding contracts have fallen from S$1bil to S$580mil. We estimate that Cosco’s outstanding order book has fallen from S$7bil as at 30 June 2009 to S$6.6bil, down from an all-time high of S$8.1bil as at end-3QFY08. Assuming new orders of S$500mil-S$1bil for FY09F-FY11F mainly from conversion jobs and marine engineering projects, we estimate that the group’s order book could still slide further to S$5.9bil by FY11F due to contract depletion. As worrying as the depleting locked-in sales may be, we highlight that Cosco’s order book still represents a comfortable 2.6x FY09F revenue for its shipbuilding, repair & marine engineering division. Note that bulk carrier jobs, which account for 20%-30% of Cosco order book could face further cancellation. These cancellation of bulk carrier projects would not be surprising, as highlighted in our Re-initiation report dated 2 July 2009. Even though Cosco currently enjoys a premium to other oil & gas stocks such as Keppel Corp, we believe that there is further upside to the stock given that current valuations are still at a 30% discount to its three-year average forward rolling PE of 20x. Given the recovery in commodity prices, we expect further upside to Cosco’s share price, which should lead to a narrowing of the discount to historical valuations. |
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| 16-Jul-2009 16:20 |
Midas
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Midas
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From Kim Eng: New TP of $1.10, based on 18x FY10 P/E From CIMB: Target price is S$0.88, and translates into 15x CY10 P/E |
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| 16-Jul-2009 15:48 |
Midas
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Midas
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Midas Holdings July 15 close: $0.82 KIM ENG, July 15 We have adjusted our FY10 net earnings by 10 per cent and derive a new TP of $1.10, based on 18x FY10 PE. BUY CONTRACTS have continued coming in since our last update: Since our last update on June 22, minor contracts worth a total of 277.8 million yuan (S$59.1 million) have continued to pour in for Midas. This brings the total value of contracts won in the past month to 1.05 billion yuan. Having highlighted earlier that contracts are likely to come in as its third extrusion line nears operation, we are encouraged by the intensity of contract momentum. Orderbook - from hopes to reality: Including these contracts, we estimate net orderbook to be about $300 million currently. To put things into perspective, we believe Midas' three extrusion production lines are fully booked till FY10 and 70 per cent booked for FY11. While we have already factored this type of utilisation rates in our earlier forecasts due to the expected strong demand, a firm orderbook now has lent greater credence to our revenue and profit models. Downstream fabrication is next: Of these contracts, 121.8 million yuan is for downstream fabrication work. Midas has installed the first fabrication line, which will likely start operations in H2 2009. Since this is still a new venture operationally, we have adopted a conservative view and our current estimates only factor in the current magnitude of contracts won. A cut above the rest: Midas also announced that it has been awarded the International Railway Industry Standard certification, which is the first for a PRC company in its business category. Together with its status as the only highest grade certified supplier to all three major international train manufacturers, we believe that Midas is still ahead of the pack in its arena. More rabbits in the hat: With extrusion capacity largely accounted for, we now believe further upside to our earnings estimate will likely come from more downstream fabrication contracts, NPRT (Nanjing SR Puzhen Rail Transport Co) contracts and possible addition of third and fourth extrusion lines. We have adjusted our FY10 net earnings by 10 per cent and derive a new TP of $1.10, based on 18x FY10 PE. BUY |
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| 15-Jul-2009 23:44 |
SPC
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SPC
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| 15-Jul-2009 23:33 |
Sakari
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Straits Asia
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15 July 2009 PARTIAL EXERCISE OF WARRANTS Singapore: 15 July 2009: Straits Asia Resources Limited (Straits Asia, SGX:SAR) is pleased to announce that it has received notice of exercise of 10 million warrants into 10 million new Straits Asia shares (New Shares) at an exercise price of S$1.095 per share. These warrants were part of the 35 million warrants that were issued to Standard Chartered Bank (“SCB”) pursuant to a Deed Poll executed by the Company on 14 November 2008 as part of the arrangements for financial facilities provided by SCB to Straits Asia in 2008. 10 million New Shares were issued on 15 July 2009 and application has been made for the listing of and quotation for the New Shares on the Main Board of the SGX-ST. In-principle approval was granted by the Singapore Exchange Securities Trading Limited (the "SGX-ST") on 2 December 2008 for the listing of and quotation for the New Shares on the Main Board of the SGX-ST upon the exercise of the Warrants. http://info.sgx.com/webcoranncatth.nsf/VwAttachments/Att_284833B2393E8E96482575F40017B5CD/$file/Partial_Exercise_of_Warrants_10Mil.pdf?openelement |
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