Stock Name: Tat Hong
Company Name: TAT HONG HOLDINGS LTD
CIMB maintains Tat Hong's (T03.SG) Outperform rating, citing strong Asian and Australian operations. The company posted another year of strong revenue (FY 2013 rising 16% on-year), while 4Q and FY2013 core profits came in-line with its and consensus expectations, forming 20%/98% of its full-year forecast. It however, trims the target to S$1.83 from S$1.90 after lowering FY2014-2016 core profit estimates due to expense-related items. The company has proposed a final dividend of 2.5 cents per share for a total of 4 cents/share in FY2013 vs 2.5 cents/share in FY2012, which is "consistent with previous payout ratios of 30%-35%," CIMB says; "(Tat Hong's) business has a lot of positive operating leverage that can be unlocked via better working-capital management," while "its high utilisation rate in the Asia-Pacific Rim guarantees decent cash flow." The house notes the share price outperformance over the past year should persist on earnings sustainability and potential M&As. Tat Hong is up 0.3% at $1.515.
Company Name: TAT HONG HOLDINGS LTD
| Research House: CIMB | Price Call: BUY | Target Price: 1.83 |
CIMB maintains Tat Hong's (T03.SG) Outperform rating, citing strong Asian and Australian operations. The company posted another year of strong revenue (FY 2013 rising 16% on-year), while 4Q and FY2013 core profits came in-line with its and consensus expectations, forming 20%/98% of its full-year forecast. It however, trims the target to S$1.83 from S$1.90 after lowering FY2014-2016 core profit estimates due to expense-related items. The company has proposed a final dividend of 2.5 cents per share for a total of 4 cents/share in FY2013 vs 2.5 cents/share in FY2012, which is "consistent with previous payout ratios of 30%-35%," CIMB says; "(Tat Hong's) business has a lot of positive operating leverage that can be unlocked via better working-capital management," while "its high utilisation rate in the Asia-Pacific Rim guarantees decent cash flow." The house notes the share price outperformance over the past year should persist on earnings sustainability and potential M&As. Tat Hong is up 0.3% at $1.515.
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