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TheEdge - BROKERS DIGEST (Nov 26 - Dec 2, 2007)
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decarn
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25-Nov-2007 09:55
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(November 26 - December 2, 2007) AsiaPharm Group (Nov 22: 48 cents) TP: 62 cents MAINTAIN BUY. AsiaPharm's 9M07 net profit of 71.2 million renminbi ($13.94 million) ( + 16.5 % y-o-y) was below our expectations due to higher-than-expected operating costs. Revenue in 9M07, in line with our expectations, surged 57.9 % y-o-y to 365 million renminbi due to higher sales of pharmaceutical drugs and increased contributions from newly acquired companies. We are cutting our net profit projections by 9.4% in 2007 and 10.1 % in 2008 after lowering our margin assumptions. We are lowering our 12-month target price to 62 cents (from 71 cents) following the cut in our earnings forecasts and update of our valuation parameters. Our target price is based on DCF valuation. We have included a net DPS of $0.01 per share. - Standard & Poor's (Nov 19) Broadway Industrial Group (Nov 22: $1.07) TP: $1.93 MAINTAIN OUTPERFORM. Broadway's component business looks set to benefit from healthy HDD demand as the overall industry staged a strong recovery in 3Q, shipping 20% q-o-q more units to nearly 134 million. The foam plastic packaging business, which formed 13% of sales in 1H, is also growing steadily as the company continues to piggy-back on seasonal demand and increased manufacturing activities in China. We have kept our FY2007-2009 net profit forecasts intact with an unchanged target price of $1.93 (10x CY08 earnings), representing 91 % upside. The stock remains a steal at 5.2x CY08 earnings relative to the industry average of about 8x. - CIMB-GK Research (Nov 19) Dutech Holdings (Nov 22: 30 cents) TP: 53.5 cents BUY (initiating coverage). Dutech Holdings Ltd is the major supplier of ATM safes to Wincor Nixdorf AG. Dutech enjoys a monopolistic position as the only Asian company awarded the UL certification for several safe designs. Placed in the sweet spot of the global ATM market's growth and recording a 43.6 % y-o-y increase in its 9M07 revenue, we project a 31.7 % growth in revenue to 248.1 million renminbi ($48.58 million) and a 21.4% improvement in net profit to 58.1 million renminbi in FY2007. In addition, we expect FY2008 revenue and net profit to increase by 37.1% and 26.8%, respectively. Based on 12x FY08 PER, we derive a fair value estimate of 53.5 cents. - OCBC Investment Research (Nov 20) Read More... |
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