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Construction sector
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elfinchilde
Elite |
15-Jan-2007 22:53
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hm..this topic's a coincidence... had a conversation recently with a fund mgmr who heads a global bank's investment section for asia-pac, this was part of the conversation thread: that those in the know bought s'pore property/construction stocks 2-3 years ago already, and now, really, it's just short term traders and punters left, and a question of who will be left holding the baby. billywows...elf is getting nervy. unless the US data is that good, i'm seriously looking to out all positions by 1st week feb or so. rather a live chicken than a dead tiger. hahahaaaa... :P |
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jackjames
Elite |
15-Jan-2007 22:44
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billywows, I share the same opinion as you. But then, I think it is still quite safe now because it just started.. |
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billywows
Elite |
15-Jan-2007 22:29
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My opinion: When was the last time one heard of the construction boom? During the mid 90's when property market was red hot. With property prices sky-rocketing again now after 10 years, it's a good excuse to throw the spot-lights on construction again. I guess the Big Boys are playing up construction counters recently cos bank and property counters had rallied too much. Pls bear in mind that all tenders for projects are awarded to the lowest bidders - who cut each other's throats to clinch the job ... even at low profit. Recalled those contractors who went bust couple of years back? Also good to note that construction raw material prices have gone up much too and will eat into the profits. With the exception of those builders who are developers too, just beware when the Big Boys pull the plug on construction counters. This will happen when the property bubble burst ... just like stock market correction! Lastly, these construction counters are penny stocks, so when they are dumped, its damn hard for them to recover till the next property boom cycle (10 years later?). Trade with care ya. |
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zhuge_liang
Supreme |
15-Jan-2007 13:56
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Reuters article. From busy Orchard Road to Sentosa island, a growing forest of cranes tower above the city's skyline as the construction sector finally emerges from a slump that began a decade ago in the 1997 Asian financial crisis. The wealthy Southeast Asian country is in the midst of a building frenzy as it seeks to spruce up its tourist image with two new gaming resorts and rejuvenates the retail scene with flashy new shopping malls. Existing residential developments sitting on prime sites are being torn down to make way for new ultra-luxurious properties. Condominiums offering waterfront living are rapidly snapped up even before the first concrete has been poured. The government has put up for sale parcels of land for new hotels, commercial buildings and residential projects, all of which will keep the construction sector growing strongly over the next few years, analysts say. Singapore's plans for two integrated resorts (IRs) offering gaming, leisure and convention facilities are the catalyst behind the construction sector revival. "It has been in a slump for a long time," said Nicholas Mak, director of consultancy and research at real estate firm Knight Frank. "Ever since the announcement of the IRs and when the amount and size of investment became known, people began to realise there could be a lot of economic spinoffs and one of the beneficiaries will be the construction sector," Mak told AFP. The two IRs, with a combined investment of more than 10 billion Singapore dollars (6.5 billion US), will have a multiplier effect on the rest of the economy through outsourcing of building works as well as lifting the property sector. "Probably in the next four years, from 2007 onwards, we are going to see a lot of construction in Singapore not just from the two IRs but also from residential development," Mak said. US gaming giant Las Vegas Sands is investing more than five billion dollars to erect a gaming and convention complex near the Marina Bay financial district while Malaysia's Genting International will build a 5.2-billion dollar casino and amusement park on Sentosa island. New residential projects near the two IRs have been grabbed by eager buyers who want to be near the action when the two resorts are up and running in 2010. Singapore lifted a ban on casino gambling in 2005 and last year awarded gaming licences to the two overseas groups. Song Seng Wun, a regional economist with CIMB-GK brokerage, estimates the two projects will create 18.2 billion dollars worth of contract work locally in 2006 and that will average 15 billion dollars over the next three years. "Apart from the many en-bloc sales of private residential units, the revamp of Orchard Road, development of Marina Bay, redevelopment of Sentosa and surrounding areas ... the recovery of the construction industry is gaining momentum," said Song. "En-bloc" sales occur at private condominium buildings when a majority of the owners agree to sell their units in one go, normally to a developer. Song is projecting the construction sector will grow 3.0-5.0 percent over the next three years. Government figures show the construction sector grew 1.1 percent in 2006, which would be the first time the industry expanded since 2000 when it recorded 1.0 percent. In 1999, the sector shrank 8.65 percent as the fallout from a financial crisis, which struck Asia in 1997-98, started to hit the building industry. Song said the construction sector created 23,000 new jobs between the first quarter of 2005 and third quarter of 2006, a sharp turnaround from the loss of 80,000 jobs between 2000 and the fourth quarter of 2004. The first condominium launch of the year, One Shenton, is almost sold out. Buyers queued to snap up more than 95 percent of the 341-unit luxury development located near Marina Bay, the project developers said. The condominium will only be ready in 2011. "All in all, it's good the IRs are coming up as it drives the property development around the area," said Alvin Liew, an economist with United Overseas Bank. |
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IreneL
Senior |
08-Jan-2007 20:03
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Hi sohguanh Thanks. I am kind of having the same sentiments. Regretably I had offloaded my BBR at a very small profit before travelling, and am now thinking of going in again. Do you have a TP for BBR? Yongnam is now at 0.165 while BBR's 0.15. |
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sohguanh
Veteran |
08-Jan-2007 17:38
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If just based on past years historical financials, I would prefer BBR over YongNam. |
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IreneL
Senior |
08-Jan-2007 17:25
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Hi zhuge_liang All things being equal between BBR and YongNam (they are both in the construction industry), which stock do you prefer - BBR or YongNam? Rgds |
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giantlow
Master |
08-Jan-2007 12:04
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yup yup. all construction related counters. steel, wiring, etc. this reminds me of a story. last time in the mid west, there was a gold rush, everyone was thinking of striking rich by digging up gold. but this clever young man thought of a better idea. he decided to sell shovels instead and became a millionare without ever finding a piece of gold. |
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firebear
Member |
08-Jan-2007 11:55
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cement, i can only think of Pan United.... any others? how about steel suppliers? construction stock are flying |
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giantlow
Master |
08-Jan-2007 11:37
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i would prefer construction related counters like cement suppliers etc. |
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zhuge_liang
Supreme |
08-Jan-2007 11:34
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Shares in construction firms soared after the head of CityDev said that Singapore's property prices would rise by as much as 20% this year, raising hopes of higher earnings.
Kwek Leng Beng, executive chairman of CityDev, said on Friday that foreign investment would help drive the rally in property prices. One dealer from a regional brokerage said that construction stocks are the "immediate beneficiaries" from the rally in the favoured blue-chip property counters. CSC surged nearly 30% to $0.285 -- its highest level in more than 6 years. BBR also soared to a more than 6-year-high of $0.145. Yongnam rose as high as $0.15. Lian Beng jumped as much as 14.9% to a record high of $0.27. |
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Nostradamus
Supreme |
28-Sep-2006 23:31
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More than half of the deals came from the private sector, which bought $3.67b worth of land in the 12 months ended Mar 31, said SLA. This is more than 12 times the proceeds from the private sector in the preceding year. The figure also surpasses the $3.08b in the last property boom in 2000, but still remains half the level of the 1997 peak, which saw $6.87b of such sales. The huge spike in last year's proceeds was mainly due to major projects such as the $1b Business and Financial Centre at Marina Bay and the $1.38b Orchard Turn development, SLA said. SLA also sold a large amount of landto JTC and HDB, with public-sector proceeds coming up to $2.18b. This is 30% higher than the previous year's proceeds, but is a far cry from the $7b worth of deals done in 1997, SLA said. |
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Nostradamus
Supreme |
28-Sep-2006 11:34
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Shares of construction firms rose, buoyed by news that the government has collected $5.8b from selling state land in the year ended March 2006 -- more than double its $1.96b take the year before.
The $5.8b figure released by the Singapore Land Authority in its annual report reflects the bullish demand for property development and construction services. |
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Nostradamus
Supreme |
27-Sep-2006 23:58
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The expected earnings are also $4-$6b more than the $10b pulled in 2003, when the sector hit one of its lowest points. At its peak in 1997, the sector pulled in $24.4b. This year's surge in demand, coming on the back of better economic conditions of the past 4 years or so is driven by major contracts awarded this year for - among other projects - 2 malls in Orchard Road and a wafer fabrication plant in Tampines. |
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Nostradamus
Supreme |
27-Sep-2006 11:09
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The Building and Construction Authority of Singapore expects the value of construction demand this year to be about $14-16b compared to $11.3b last year, the Business Times reported. The projected range is ahead of the agency's previous forecast of $12.0-13.5b. The newspaper quoted Minister of State for National Development Grace Fu as saying more construction activity can be expected in the coming years with upcoming projects in the Orchard Road shopping district, as well as the two integrated casino resorts that will be built. |
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