Yongnam

Yongnam: Wholly-owned subsidiary Yongnam Engineering (HK) was awarded two contracts with an aggregate value of HK$166m (S$27m). The first subcontract was awarded by the joint venture of Chun Wo-CRGL-MBEC, for the Central-Wan Chai bypass tunnel. It will include the construction of temporary steel bridges between the tunnel's north point section and Island Eastern Corridor Link, with an expected completion date in Apr 2014. The second subcontract was awarded by the joint venture of Samsung-Hsin Chong, for two MTR stations for the Shatin to Central Link (SCL). Yongnam will undertake the design, supply, install and subsequently dismantling of c.10,000 tons of steel struts for the tunnels and entrances of Sung Wong Toi and To Kwa Wan stations, and has an expected completion date by 2016. This takes current order book to c.$350m, with another $1.3b worth of projects that the group is targeting. At the last closing price of $0.345, Yongnam trades at a forward P/E of 7.8x and has a 12-month TP of $0.41.