Jaya Holdings

Jaya Holdings: CIMB maintains O/p with $0.88 TP. House note that after three years of trials and tribulations, shareholders are finally rewarded with a full-year DPS of 4c, house we believe is sustainable. Furthermore, this was accompanied by a strong 4Q13 performance that beats expectations. FY13 core net profit formed 1.6x of house full-year forecast, due to the disposal of two vessels. A final DPS of 3.5c was declared (vs. estimates of 0.5c). Factoring in the reconfiguration of its newbuild schedule, house cut FY14-15 core EPS by 14-16%. Maintain Outperform rating and target price, still based on 1x CY13 P/BV (its 4-year mean). The catalysts could come from stronger chartering operations and shipbuilding wins. House view that Jaya's chartering division is going from strength to strength is underscored by its FY13 performance. Excluding the US$20.3m disposal gains and US$5.4m net reconfiguration costs, Jaya generated US$10.5m adjusted core earnings in 4Q13, 20% above our expectation. The positive variance came from stronger chartering rates and utilisation. Given its higher-value vessels, Jaya yielded a daily rate of US$13,624 vs. US$10,485 in FY12 (+30% yoy). It also achieved 80% fleet utilisation in FY13 vs. 70% in FY12. 4Q13 utilisation rebounded strongly to 91% from 64% in 3Q13. Jaya has net cash of US$59m.