Thursday, August 15, 2013

Yongnam :In Crisis Lies Opportunity (MKE)

Yongnam Holdings
Buy (unchanged)
Share price: SGD0.27
Target price: SGD0.40 (from SGD0.465)
In Crisis Lies Opportunity

 Unsuccessful in both Myanmar airport tenders. Having earlier estimated a 50% chance for Yongnam’s consortium in both the Hanthawaddy International Aiport (HIA) and Yangon International Airport (YIA) extension, we are disappointed at the outcome. However, given that 1) material impact in the short-medium term is small and 2) there is still a remote possibility of getting back into the projects, we think share price has been over-penalized.


Very close calls. The Myanmar government will now enter into direct negotiations with consortiums led by Incheon International Airport for HIA and Pioneer Aerodrome Services for YIA. We believe the final decisions were very close calls, as evident by the naming of Yongnam’s consortium as back-up tenderers for both projects. We believe the final decisions were swayed more by overall package terms rather than technical expertise.

Share price over-penalized. Share price has corrected more than 20% in the past three weeks. Materially, we estimate YIA would have added around SGD9m of profit to FY14, while HIA would have only contributed from FY16 onwards. This also excludes execution risks given the brand-new market and need for equity investment on Yongnam’s part. This development also does not change our core investment thesis that the company is well-placed to benefit from the infrastructure build-up in Asia.

Other contract catalysts. The company is in close negotiations for several more sizeable contracts, which will be announced within the next few months. Potential work to commence in 2H13 includes MS Development, Hong Kong MTR extension and Thomson Circle line. These could change the orderbook profile significantly. We are now expecting around SGD300m in order wins for the rest of the year.

Maintain BUY. We scale back on our TP to account for 1) SGD4.5cent/ share we originally factored in for a 50% chance of winning YIA 2) Using 9x FY14F (one-standard deviation above 5-year average mean PER). Our new TP is now SGD0.40. Trading at 1x P/B and 3x EV/EBITDA, we believe the stock is undervalued and see this development as an opportunity rather than crisis. Maintain BUY.




Source/Extract/Excerpts/来源/转贴/摘录: MKE-Research,
Publish date: 14/08/13

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Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
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做自己熟悉的事,等到发现大好机会才投钱下去

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“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
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