Monday, February 20, 2012
PSL
PSL: Signed a MOU with JPN Industrial Trading with definitive agreements targeted within 6 mths. Both co will work to establish a JV (80% owned by PSL) to own and lease heavy equipment for coal mining and related businesses in Indonesiawith initial invt of up to $50m in the way of pro-rata equity contributions. The day to day business mgmt will be handled by JPN Industrial.
IEV Hldgs
IEV Hldgs: To directly enter into O&G exploration. Subsi PT IEV Gas has been awarded its very first onshore oil and gas agreement by Pertamina EP, an upstream sector subsi of PT. Pertamina (Persero) under the KSO agreement. Finalisation of the KSO agreement by state-owned BPMIGAS and PT Pertamina is expected to be completed in 2Q2012. IEV Gas is appointed to commercialise Pertamina EP’s operation area and obtains compensationthrough a ‘split’ in oil and natural gas production. IEV Gas is to recover all costs incurred in the project before the remaining balance is shared between BPMIGAS, Pertamina EP and IEV Gas. IEV Gas will undertake the exploration and production activities during the 15 yr concession period. Experts will be engaged to determine the reserves and certify them. First production only to begin in 2H2013.
The block to be explored is 89km east of Jakarta and is a total of 77.0 sq km. The KSO agreement is to optimise exploration, development and production assets within Pertamina EP’s operating areas.
The block to be explored is 89km east of Jakarta and is a total of 77.0 sq km. The KSO agreement is to optimise exploration, development and production assets within Pertamina EP’s operating areas.
Fragrance
Fragrance: Spinning off hotel mgmt arm. Global Hotel, the investment holding company for the hotel ownership and mgmt division of the Group has obtained a letter of eligibility to-list from SGX. Global Hotel expects to offer new shares in its IPO. Sh/h approvals are still necessary for the IPO to go through as well as submission of internal audit and control matters and other documents.
Chemoil
Chemoil: CIMB note that looking at Bloomberg data, Chemoil’s historical valuations appear to be in line with peers. But the gain in the share price suggests that the market believes Glencore is pining to take Chemoil private.
Technically, the stock broke out above its key resistance zone of $0.31-0.365 last wek. Strong rising vol suggests that the breakout is genuine and is likely to take prices higher. However, the breakout has taken its indicators into overbought levels, which might prompt some investors to take profits. Nevertheless, the trend is still up, targeting $0.515 and possibly even $0.585.
Technically, the stock broke out above its key resistance zone of $0.31-0.365 last wek. Strong rising vol suggests that the breakout is genuine and is likely to take prices higher. However, the breakout has taken its indicators into overbought levels, which might prompt some investors to take profits. Nevertheless, the trend is still up, targeting $0.515 and possibly even $0.585.
Chemoil
Chemoil: CIMB note that looking at Bloomberg data, Chemoil’s historical valuations appear to be in line with peers. But the gain in the share price suggests that the market believes Glencore is pining to take Chemoil private.
Technically, the stock broke out above its key resistance zone of $0.31-0.365 last wek. Strong
rising vol suggests that the breakout is genuine and is likely to take prices higher. However, the breakout has taken its indicators into overbought levels, which might prompt some investors to take profits. Nevertheless, the trend is still up, targeting $0.515 and possibly even $0.585.
Technically, the stock broke out above its key resistance zone of $0.31-0.365 last wek. Strong
rising vol suggests that the breakout is genuine and is likely to take prices higher. However, the breakout has taken its indicators into overbought levels, which might prompt some investors to take profits. Nevertheless, the trend is still up, targeting $0.515 and possibly even $0.585.
Olam
Olam: JP Morgan downgrades to Neutral with $2.80 TP. House note of slowing earnings growth on back of:
i) weaker than expected 2Q12 results (Feb. 14th),
(ii) muted outlook for industrials segment (cotton, timber) and
(iii) limited sizeable “new” assets to provide earnings lift in near term, estimate Olam is likely to experience “sub-20% earnings growth over the next 2 years.
Overall, house cutting FY12E/13E earnings estimates by 13% /17% and downgrade recommendation to “Neutral” with a revised DCF based Jun-2013 PT of $2.80. At current levels, prefer Noble Group (within the sector) given, (i)kely positive surprise on 4Q11 earnings (in our view) and (ii) its cheaper valuations (on 2012E, NOBL trades at 10x P/E, 1.5x P/B)
i) weaker than expected 2Q12 results (Feb. 14th),
(ii) muted outlook for industrials segment (cotton, timber) and
(iii) limited sizeable “new” assets to provide earnings lift in near term, estimate Olam is likely to experience “sub-20% earnings growth over the next 2 years.
Overall, house cutting FY12E/13E earnings estimates by 13% /17% and downgrade recommendation to “Neutral” with a revised DCF based Jun-2013 PT of $2.80. At current levels, prefer Noble Group (within the sector) given, (i)kely positive surprise on 4Q11 earnings (in our view) and (ii) its cheaper valuations (on 2012E, NOBL trades at 10x P/E, 1.5x P/B)
Hi-P
Hi-P: Shares hit 6-month high on iPhone talk. Analysts up 2012 earnings estimate 28% and price target 54% after firm's $100m capex in guidance
DMG note that the Co. could be a key supplier for the next-generation iPhone. Add that channel checks show that the gup has already secured a large order for its new metal-casing business, which house believe to be Apple. Reiterating their 'buy' call, house raised the earnings estimate for FY12 27.9% to $86.3m, and their TP by 54% to $1.22.
DMG drew attention to Hi-P's surprising 'massive $100m capex expansion' in its 2Q guidance to increase production capabilities to keep up with an increasing use of metal in smart-phones, tablets and other consumer electronic devices. Given Hi-P's record of low capex spending and the mgt's conservative nature in running the business, house doubt that Hi-P would proceed without securing any orders.
Hi-P is known to be a supplier for Apple; it has a track record of supplying electro-mechanical parts and carries out assembly work for the Apple iPad 2 tablet. But metal casing offers better margins. Leading metal casing maker Catcher Technology Co of Taiwan has gross profit margins of about 25% compared with Hi-P's 19%. Metal casing makers are also trading at higher valuations, with share prices trading at an average of 13.6x FY12 estimates, DMG said. Hi-P is only trading at about 8x Fy12 estimates.
DMG note that the Co. could be a key supplier for the next-generation iPhone. Add that channel checks show that the gup has already secured a large order for its new metal-casing business, which house believe to be Apple. Reiterating their 'buy' call, house raised the earnings estimate for FY12 27.9% to $86.3m, and their TP by 54% to $1.22.
DMG drew attention to Hi-P's surprising 'massive $100m capex expansion' in its 2Q guidance to increase production capabilities to keep up with an increasing use of metal in smart-phones, tablets and other consumer electronic devices. Given Hi-P's record of low capex spending and the mgt's conservative nature in running the business, house doubt that Hi-P would proceed without securing any orders.
Hi-P is known to be a supplier for Apple; it has a track record of supplying electro-mechanical parts and carries out assembly work for the Apple iPad 2 tablet. But metal casing offers better margins. Leading metal casing maker Catcher Technology Co of Taiwan has gross profit margins of about 25% compared with Hi-P's 19%. Metal casing makers are also trading at higher valuations, with share prices trading at an average of 13.6x FY12 estimates, DMG said. Hi-P is only trading at about 8x Fy12 estimates.
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