Towards Financial Freedom
DBSV S'pore Wired Daily 5 September 2013
Today's Focus
Goodpack - Resuming growth path; maintain BUY and TP of S$2.00
Goodpack's prudent business model and market share gain bolster its earnings during downturn. Earnings
growth has been rather muted in the past two years. We believe the tide is changing for Goodpack and project a 2- year CAGR of 17% in FY13-15F, driven by market share gain in synthetic rubber (SR) segment and cost-saving initiatives. This is augmented by the recovery in US/Europe (45% of Goodpack's revenue) and bottoming out of the rubber industry, which is expected to grow at 2-6% in the same period. The crytalisation of an autopart contract from a major OEM in Europe will prompt us to further rerate. Dividend yield of 3-4% is decent while valuation is undemanding. Maintain BUY and TP of S$2.00.
Yangzijiang announced that there was a further four options with an aggregate value of US$ 110.4m converted into effective orders last month, comprising two units of 1,100 TEU containerships and two unit of 82,000 DWT bulk carries. The vessels will be delivered in 2015. YTD wins of US$1.2bn made up 60% of our full year assumption of US$2bn. We believe Yangzijiang is on track to meet our target. It has remaining 51 options
worth US$2.87bn, of which 22 options are for containerships worth US$1.79bn and 29 options are for
multi-purpose bulk carriers worth US$1.08bn. Maintain HOLD, TP: S$1.02.
Global Logistic Properties will commence development of GLP Zama, a new multi-tenant logistics facility in Greater Tokyo. GLP Zama is to be redeveloped into a 130,000 sqm (1.4 million sq ft) multi-tenant logistics facility. This is the sixth project under GLP Japan Development Venture, which has now committed a total of JPY79.6 bn
(US$802m). The project will be completed in July 2015.
Indofood Sukses Makmur (INDF) has raised its stake in China Minzhong Food Corp (MINZ) to 51.6%. The press release said INDF's rationale included securing the supply of instant noodle seasoning packs from China Minzhong (presumably at lower than current cost), the introduction of industrialised farming and replicating MINZ's business model in Indonesia. The press release also reiterated INDF's confidence in MINZ, and that INDF had taken necessary steps to ensure that its investment in MINZ is prudent.
Hiap Hoe has made its second strategic overseas acquisition in two months. This time round, is a
commercial building on a 3,165 sqm site located in the heart of Melbourne's Central Business District, near the
corner of Lonsdale Street and Elizabeth Street. The acquisition comes with a newly issued permit for an iconic
46 level mixed-use development comprising 627 apartments, 445 bay commercial car park and ground
level retail. The Group intends to fund this acquisition with a combination of internal resources and debt.
Singapore retained its place as the world's second-most competitive economy, after Switzerland which held the
top spot for a fifth year. This is according to the World Economic Forum's latest Global Competitiveness Report.
Singapore is the only economy to feature in the top 3 in seven out of the 12 pillars of the Global Competitiveness
Index, which looks at goods market efficiency, labour market efficiency and financial market development, among other pillars. Singapore's competitiveness is further enhanced by its strong focus on education, which has translated into a steady improvement of its ranking in the higher education and training pillar, where it comes in
2nd, behind Finland.
In property news, twp residential sites - a freehold redevelopment plot in Katong and a two-storey bungalow
in Bukit Timah are up for sale. The Katong site at 12 Amber Road is occupied by several old, vacant houses.
Measuring 22,800 square feet, it is zoned for residential development, and has an allowable gross plot ratio of
2.8. The asking price, in excess of $63m, works out to a land rate of some $1,300 psf ppr. Meanwhile, the Bukit
Timah site, with an indicative price of $32m, is in a goodclass bungalow area. It is a corner plot at 19A Yarwood
Avenue, off Dunearn Road.
US stocks rose after the FED's Beige Book survey reported the economy continued to grow in July to August even as borrowing costs increased. Automakers and technology companies led gains. Meanwhile, the Senate panel has authorized the US President to conduct a limited military operation against Syria because of its use of chemical weapons. The August ADP employment change (consensus 182k, previous 200k) released tonight comes ahead of Friday's official job numbers.
Source: DBSV
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
