Teckwah Industrial: It announced in January this year that Airjet Auto-care had become a substantial shareholder (exceeding 5% stake).
Now, Airjet Auto-care's holding has ballooned to 14.5 m shares, or 6.21% of the issued share capital of Teckwah.Airjet Auto-Care is a wholly-owned subsidiary of Ho Bee Holdings, which in turn is 69% owned by Mr Chua Thian Poh and 17.5% by his wife, Madam Ng Noi Hinoy.
Mr Chua is chairman and CEO of Ho Bee Group, which is better known for its luxury property developments on Sentosa Island.
Teckwah's cash of $43 million on its balance sheet and minimal borrowing. Compared to its cash, Teckwah's market cap of $66 million makes the stock look undervalued since investors would be paying only $23 m for the business.
This business reaped $12.2 m in profit last year - a jump of 189% from 2008. Revenue, however, declined 12%.
The profit jump came from factors such as cost-cutting, lower transport costs and increased efficiencies and lower material prices.
Teckwah stock traded recently at 28.5 cents, a 43% discount to its Net Asset Value of 40.7 cents (as of end-Dec 09).
Its FY09 dividend payout was 0.8 cent + 2 cent for a total of 2.8 cents, compared to just 0.8 cent for the final dividend in FY07. It is uncertain if the company will maintain the 2.8-cent payout this year.
Recent story: TECKWAH INDUSTRIAL attracts tycoon Chua Thian Poh as shareholder
CHINA ENVIRONMENT: In the last three months, Prosper Big International has been buying the stock on the way down. Its purchase on Mar 1 was at 36.6 cents on average. The stock ended at 19.5 cents last Friday.
Last week, Prosper Big International purchased 1.08 million shares.
It is wholly owned by Huang Min, the chairman and CEO of China Environment. Through Prosper, he owns 38.06% of the company.
Another enthusiastic buyer (who bought 831,000 shares last week) has been high networth investor Ma Ong Kee, who now owns 3% direct and 22.09% deemed interest in China Environment, which provides waste gas treatment systems in the PRC.
In 1Q, the company had a 22% rise in revenue to RMB130.4 m but a 10% decline in net profit to RMB22.1 m.
NextInsight’s China correspondent, Andrew van-Buren, put out a report on a recent analyst briefing by Huang Min in Hong Kong, where the latter said: “I don’t have trouble sleeping at night. That’s because we don’t create pollution. We help curb it. We help people live better lives.”
CHINA ENVIRONMENT: 50-ct price target & 72% upside by Finansa