Chip Eng Seng

CES is still very undervalued.

Roxy Pacific
Book NAV = 29.5 cents
ANAV (adjusted NAV) or RNAV = 66.6 cents
Current Share Price = 58 cents
Discount to ANAV = 13%
Premium above book NAV = 97%

Wee Hur
Book NAV = 24 cents
RNAV = ??
Share price = 38 cents
Discount to RNAV = ?
Premium above book NAV = 58%

Oxley
Book NAV = 17 cents (Dec 2013)
RNAV = ??
Share price = 63
Discount to RNAV = ?
Premium above book NAV = 270%.


Applying the above to CES case
Book NAV = 80 cents (Q2-2014)
Share price = 87 cents
RNAV (by end 2014) = ~$1.15
RNAV (by end 2015) = ~$1.60
RNAV (by end 2018) = ~$2.23

15% discount to the above RNAV
end FY14 - $0.98
end FY15 - $1.36
end FY18 - $1.90

(NRH) Chip Eng Seng - Increasing its portfolio of recurring revenue

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Chip Eng Seng - Increasing its portfolio of recurring revenue
2014-08-22 01:27:35.431 GMT

Maintain forecasts and recommendation. We maintain our full year forecasts given that the lower-than-expected 2Q14 profits was mainly due to timing recognition issues with Belysa. As a result, our SOTP fair value remains at S$1.04. With a 29% potential upside and an attractive 5% dividend yield, maintain overweight.

Provider ID: 00000358


-0- Aug/22/2014 01:27 GMT

The most recent share buyback on 22 Aug came as a pleasant surprise.

One might be wondering why the company did not do the buyback during the recent pullback to 79 cents...

Any view on this pls? Tks.

Hi Sumer

NRA capital has forecast the following surplus figure

a. investment properties ($21mil)
b. Hotel surplus ($68mil)


Do u think that the figures are on the very conservative side?
(my estimate of the hotel surplus is ~$184mil).

Chip Eng Seng Corporation Ltd- PhillipCapital Market Watch, enjoy!

Hi plover, I think we all use different cost and value assumptions, leading to different surplus for CES' Alexandra hotel.

I am surprised at NRA's figures too, since they had assumed a $850k per key value, which is higher than my assumption of $800k. The report did not indicate how much total cost they assign to the hotel development, but if you work backwards, a $850k per key would give the hotel a market value of $382.5m. A $68m surplus (assume no corporate tax)means NRA estimated the hotel to cost $314.5m (land and all other costs). Since land cost is clearly spelled out by CES itself to be $122.6m for the hotel portion, that leaves $191.9m as construction and other costs for the hotel.

This is a strangely high figure considering that CES awarded construction to Keong Hong for the whole project (hotel plus shops) for only $101m. Even if other costs (like beds and such) are added in, that will never add to $191.9m.

I am not sure my maths above is correct, but Phillip Securities' estimate of the hotel surplus of $139m does make NRA's figure look odd. My own is slightly below Phillip's figure.

In any case, I like CES' recent Fernvale sites purchase, and I think the sites can be quite profitable (perhaps EPS of 12-15ct), compared to what I read (that it will just be keeping its construction arm occupied).
Today's continued share buyback at nearly 90ct is another vote of confidence by the company.