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UOB KAYHIAN |
UOB KAYHIAN |
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Hong Leong Asia (HLA SP) 2024: Results In Line, Dividend Doubles
HLA posted strong 2024 results with PATMI growing 35.3% yoy, driven by its two main segments. Despite a challenging domestic market, China Yuchai recorded strong unit sales volume. The Building Material Unit benefitted from the ongoing construction industry upcycle and faces a strong orderbook going into 2025. In our view, HLA remains undervalued given the positive outlook for its businesses. Maintain BUY with the same SOTP-based target price of S$1.11.
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Sembcorp Industries (SCI SP) 2024: Strong Results With Medium-term Growth Intact
SCI’s 2024 results beat our and consensus expectations, with the highlight being a meaningful step-up in its dividend and payout ratio which management emphasised was sustainable given its strong cashflow generation. We came away from the results briefing with greater confidence in the company’s near- and medium-term growth prospects, both in Singapore and overseas. Maintain BUY. Target price raised to S$8.00.
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UOB KAYHIAN |
UOB KAYHIAN |
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Singapore Technologies Engineering (STE SP) 2024: Results A Slight Beat; Good Growth Visibility Backed By Strong Orderbook
2024 core net profit of S$681m (+23% yoy) came in slightly above our expectations, at 102.3% of our full-year forecast, thanks to better-than-expected margins of CA and USS. Headline net profit rose 20% yoy to S$702m. STE declared a higher 4Q24 dividend of 5 S cents (+1 S cent yoy). We remain positive on STE’s growth outlook in the medium term, underpinned by its record-high level of orderbook of S$28.5b as at end-24. Maintain BUY with a higher target price of S$5.55.
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Yangzijiang Shipbuilding (Holdings) (YZJSGD SP) 2024: Solid Results With Shipbuilding Margins The Highlight
2024 results beat our and consensus expectations with shipbuilding margins of 27.9% being the key highlight. While news of the USTR’s proposal has impacted its share price, YZJ disclosed that it has not received any order deferrals or cancellations, with any costs relatively easy to pass on. We believe the company could start a share buy-back programme imminently. Maintain BUY. Cut target price to S$3.50 (S$3.60 previously)
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| LIM & TAN | LIM & TAN |
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Propnex ($1.13, unchanged) recorded a net profit of $40.9 million on revenue of $783.0 million for the full year ended 31 December 2024 (“FY2024”), demonstrating its resilience amid a relatively subdued property market. FY2024’s lower revenue was primarily due to a 23.4% year-on-year (“YoY”) decrease in commission income from project marketing services to $185.6 million. Commission income from agency services rose slightly to $591.6 million. In 2024, 6,469 private new homes (excluding ECs) were transacted, a slight increase from the 6,421 units transacted in 2023.2 The private resale market remained resilient, with 14,053 private homes transacted, marking a significant 24.0% rise from the 11,329 units in the previous year. Meanwhile, the HDB resale market saw continued growth, with 28,986 flats transacted in 2024, up 8.4% from the 26,735 units recorded in 2023. Propnex market cap stands at S$836 mln and currently trades at 15x forward PE, with a dividend yield of 5% (6.8% if including special of 2.5 cents). Consensus target price stands at S$1.17, representing limited upside from current share price. Propnex’s share price has done well since we included it in our top 2024 pick list last year. With valuations looking quite fair now, but yield still quite attractive and potential for more goodies installed for shareholders with the company’s 25th anniversary celebrations, we would HOLD Propnex shares for now.
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Yangzijiang Financial Holding / YZJFH ($0.565, unchanged) has announced its financial results for the six months and full year ended 31 December 2024 respectively (“2H2024” and “FY2024”). The Group reported total income of S$326.2 million for FY2024, reflecting a 6% decline from S$348.4 million in FY2023. This decrease was primarily driven by lower interest income, which fell to S$195.8 million in FY2024 due to a reduced average balance of debt investments in China. However, the decline was partially offset by stronger contributions from cash management activities and fund investments. At S$0.565, Yangzijiang Financial is capitalised at S$2.0bln and trades at undemanding valuations of 6.5x P/E, 0.48x P/B and 6.1% dividend yield. YZJFH has ended 2H24 on a strong note, delivering growth in income from maritime assets as well as reversal of credit loss allowance on its debt investments. Full year dividends of 3.45 S cts (FY23: 2.2 S cts) was a positive surprise and represents a decent 6.1% yield. YZJFH has since achieved portfolio diversification with 54% of investments outside China (only 29% are in debt investment in China). As the company transits its focus towards maritime related investments, investors may find support in YZJFH’s cash and yield enhancement products of S$0.52/share. We will be hosting key management of Yangzijiang Financial for a webinar today at 5pm. |
