Friday, December 20, 2013

TAT HONG : Key takeaways from investor’s meeting (UOBKH)

TAT HONG HOLDINGS
Share Price S$0.88
Key takeaways from investor’s meeting

INVESTMENT HIGHLIGHTS
• Tat Hong provides crane rental, heavy lift, heavy haulage and equipment sales services. It is the largest crane company in the Asia-Pacific region, supplying cranes ranging from under 50 tonnes to 1,600 tonnes. Tat Hong has also aggressively expanded its tower crane rental business in China and is the second-largest tower crane company in the country.


• Tat Hong reported two sequential declines in quarterly net profits in FY14 (1Q14: - 51%, 2Q14: -53%) as weaker economic outlook in Indonesia and Australia eroded revenue from the crane rental and distribution businesses. These two segments contributed 78.4% of the company’s top-line.

• The company faces cost pressures as wages continue to rise due to the tight labour market and transportation expenses increase for the relocation of cranes under the tower crane rental division. The company is also affected by unrealised foreign exchange losses arising from inter-company loans and payables related to its Indonesian operations due to a steep devaluation of the rupiah. Net profit of S$16.4m in 1HFY14 made up only 23.3% of FY13 earnings.

• Crane rental’s revenue fell 14% yoy to S$70.3m in 2Q14 due to weaker specialized transport income from Australia’s subdued mining and infrastructure activities. Gross margin from the segment retreated to 52.0% from 56.6% in 1QFY14 on higher labour costs despite an improvement of utilisation rate in the quarter. Revenue from the distribution segment (40.5% of 2QFY14 revenue) also fell 17% yoy to S$75.0m due to an economic slowdown in Australia and reduced excavator sales in Indonesia.

OUR VIEW
• While Tat Hong is now trading at a 15.7% discount to its 3-year average P/B of 0.98x, any increase in earnings will largely be dependent on the Australian’s economic growth, which has remained muted after reporting a seasonally adjusted 0.6% in 3Q13. Its Reserve Bank also revised down the country’s growth forecasts for 2014 and 2015 after it said mining investment was set to fall off at a faster-thanexpected pace next year.

VALUATION
• Tat Hong is trading at forward PE of 11.1x and P/B of 0.83x. Bloomberg estimates its 12-month target price at S$1.10. Tat Hong has underperformed the FSSTI, with share price declining 35.1% ytd against the index’s -3.6%, as several brokers downgraded their earnings forecasts and target prices following two quarters of weak earnings.




Source/Extract/Excerpts/来源/转贴/摘录: UOBKH-Research,
Publish date: 17/12/13

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