Thursday, February 14, 2013

TEE International

TEE International: OCBC maintains Hold with $0.30 TP. Note that since last report on TEE, its share price has stayed firm, retaining most of the gains made since the start of the yr, despite its disappointing 2Q13 results. Believe that TEE’s share price has been supported by recent strong interest in SG construction stocks generally, boosted by the govt’s latest projections for construction demand and population growth, both of which should benefit the construction sector. House raise valuation of TEE’s main engineering business to 5.5x FY13 forecast earnings from 5x previously, to reflect the improved long-term outlook for its engineering segment. Given its weak 2QFY13 showing, prefer to remain cautious on TEE until it sees stronger contributions from its real estate business.

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