Kep Corp

Kep Corp: Results above expectations. 2Q rev at $3.5b +52.2% yoy -22.5% qoq Net profit was $520.9m +35.4% yoy -44.1% qoq. Net profit was boosted by profits from recognition of Reflections of Keppel Bay (70% JV with Kep Land), similar to last quarter but should not see these earnings repeated in 2H12. O&M continued to perform with 1H segment rev up 60% yoy due to higher volume of work although operating margins saw a decline from 15.1% to 13.1%. This was partly due to lower priced contracts won after the global financial crisis. The division has net orderbook of $7.6b with deliveries extending into 2015 A $0.18 dividend per share has been declared. Co currently trades at 11.8x P/E. Deutsche has TP at $13.70 and maintains Buy. CIMB has TP $14.80 and maintains Buy.