Excerpts from latest analyst reports......
SIAS Research says Roxy-Pacific added $150 million to progress billings in 2012
Analyst: Liu Jinshu
We re-initiate coverage of Roxy-Pacific Holdings Limited (Roxy) with an Increase Exposure rating and an intrinsic value of S$0.605 (post-bonus issue).
Strong recent sales suggest that Roxy’s progress billings are now in excess of S$750m, substantially confirming that the company will still be able to deliver core earnings growth from now to 2014 and has time to cherry pick new land deals.
Moreover, we like the highly versatile nature of the company, which reassures us that Roxy will be able to adapt to the evolving property market and continue to roll out successful products.
Fundamental Drivers / Key Developments: Recent Sales Have Boosted Progress Billings: We estimate that Roxy has sold 91% of its units launched in 2012, adding about S$150m of unrecognized sales to progress billings.
Three out of four projects have attained “sold out” status – TREESCAPE, Millage and Natura@Hillview Phase 1. Sales of previously launched projects added another ≈S$30m to progress billings in 2012.
Hotel & Investment Properties Buttress Valuation: Moreover, Roxy owns a hotel and a portfolio of shop units that are valued at S$461.6m (S$0.483 per share) as at end 2011 by an independent valuer.
As such, Roxy’s current market value does not incorporate much of the development gains in its >S$750m of progress billings, that will be recognized as profit from now to as late as 2016.
For the full 22-page SIAS report, click here.
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DBS Vickers says ASL Marine has 30% upside
Analysts: Suvro SARKAR & Jeremy THIA
We recently visited ASL Marine’s shipyard in Batam, Indonesia and discussions with management confirmed a robust operating outlook, in line with our expectations. The cheaper yard operations in Batam, as compared to Singapore, and associated synergies between the two yards enable the group to bid competitively for contracts, while still reaping decent margins.
The shipbuilding division has seen impressive order inflows in recent months, driving orderbook close to pre-crisis highs and ensuring healthy yard utilisation till end-2013. While the group can still take in more orders, estimated earliest delivery dates could be end-2013/ early-2014.
Attractive valuations, 30% upside to our TP, even as the stock is up about 9% since our last report. With a significantly enhanced order backlog and earnings visibility – c. 90% of shipbuilding revenue in FY13 is secured by existing orders – and an estimated earnings rebound of over 40% in FY13, we maintain our BUY call on ASL and TP of S$0.83.
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