Lian Beng: Announced strong 1Q12 results which were in-line. Rev at $135.8m, +21% yoy, while net income at $19.3m, +74.7% yoy, while gross margins remained relatively stable at 15.1% vs 16% yoy.
Strong results was attributed to gro’s steady rev contribution from its core construction segment, ppty development as well as ready-mixed concrete segments during the qtr. There was also a one-time gain of $7.9m from the sale of grp’s New Industrial Road investment ppty.
Moving forward, Co. remains cautiously optimistic on its outlook for the construction industry for the next 12 mths. Not that HDB is ramping up supply of BTO new flats to meet the shortage of public housing, while the private property market should also maintain a stable momentum going forward.
We note that grp orderbook stands at $761m, underpinning earnings visility till 2013, while at current price, valuations are very compelling, with grp trading at annualized 2.3x FY12E P/E. Kim Eng maintains Buy with $0.62 TP.
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