Stock Name: Yongnam
Company Name: YONGNAM HOLDINGS LIMITED
Company Name: YONGNAM HOLDINGS LIMITED
| Research House: CIMB | Price Call: BUY | Target Price: 0.40 |
14 Jun 2011 Singapore | |
Company Update | |
Yongnam Holdings Ltd [ PDF] | |
| All systems in place - | |
| (YNH SP / YNAM.SI, OUTPERFORM - Maintained, S$0.26 - Tgt. S$0.40, Construction) | |
| YNH's contract wins had picked up strongly in 2Q11, with the group securing more than S$190m worth of contracts or 40% of our target for this year. Coupled with profit margins which had been sustained over the four quarters of 2010 (with a positive surprise in 1Q11), we believe YNH is on track to meet our FY11 earnings target. No change to our EPS estimates or target price of S$0.40, still based on 8x CY12 P/E, a 20% discount to its mid-cycle multiples. We also like YNH's undemanding valuations against peers, at 5.2x CY12 P/E vs. the peer average of 7.6x. We expect stock catalysts from contract wins for projects such as the MRT Downtown Line and structural steelwork projects in the Middle East. | |
Trading houses are accumulating this counter slowly without wanting to attract market attention .
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