Thursday, November 14, 2013

Hyflux: Slow 4Q after strong 3Q (OCBC)

Hyflux:
Fair value S$1.23
add: 12m dividend forecast S$0.030
versus: Current price S$1.170
Slow 4Q after strong 3Q

In 3Q13, Hyflux saw revenue jumped 26% YoY to S$187.7m and net profit rose 74% to S$25.3m, such that 9M13 revenue of S$450.7m met 68% and earnings of S$51.0m met 75% of our FY13 forecasts, respectively. But with the completion of Tuaspring in 3Q, Hyflux believes that 4Q is likely to be slow. Nevertheless, management remains largely upbeat about its prospects, as it is working on tenders for various projects in MENA potentially worth S$2b. As we roll forward our 20x multiple from blended FY13/FY14 to FY14F EPS, our fair value inches up from S$1.215 to S$1.23. But we opt to keep our HOLD rating on the stock until we see better clarity on its project wins.


Strong 3Q13 results
Hyflux Ltd reported 3Q13 revenue jumping 26% YoY (36% QoQ) to S$187.7m, mainly due to the completion of projects in the quarter (likely Tuaspring which was commissioned on 18 Sep). Gross margin also improved significantly to 62%, versus 41.6% in 2Q13 and 41.8% in 3Q12, thus allowing net profit to surge 74% YoY and 43% QoQ to S$25.3m. For 9M13, revenue eased 4% to S$450.7m, meeting 68% of our full-year forecast, while net profit rose 28% to S$51.0m, or 75% of our FY13 estimate.

But expects a slow 4Q
However, Hyflux warns that 4Q13 may not be as strong seasonally, given the completion of Tuaspring in 3Q13, and will be mostly working on the EPC portion of the co-generation power plant at Tuaspring. In addition, management notes that the financial close of its Dahej project in India is likely to be in 1Q14, along with the financing package. As such, we deem it prudent to reduce our FY13 revenue estimate by 5% and earnings by 6% (also to account for a higher depreciation expense).

Prospects for 2014 remain upbeat
Nevertheless, management remains largely upbeat about its prospects. For one, it will focus on tendering for various large projects in MENA in 4Q, and some would be in places like Saudi Arabia (1m m3/day capacity), Kuwait (500k m3/day) Oman (400k m3/day), Nigeria (300k m3/day), which could potentially be worth some S$2b in project value. It adds that it is actively pursuing desalination and water recycling opportunities in the industrial water space.

Maintain HOLD with higher S$1.23 fair value
While our fair value inches up from S$1.215 to S$1.23 as we roll forward our 20x multiple from blended FY13/FY14 to FY14F EPS, we opt to keep our HOLD rating on the stock until we see better clarity on its project wins.



Source/Extract/Excerpts/来源/转贴/摘录: OCBC-Research,
Publish date: 08/11/13

No comments:

Post a Comment

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
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“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!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock