TTJ

TTJ: 2QFY14 net profit and revenue were up 28% y/y at $5.3m and $41.1m respectively. The increased topline was contributed by a few major projects, such as Tuas West MRT Extension Depot, Lanxess Compass Project, and Nalco’s Eastern Hemisphere Core Plant within the Group’s structural steel business. Gross margin fell from 26.6% to 22.1% on a non-recurring loss for a structural steel project, offset by better gross margins from other projects, as well as better margins from its dormitory business. BCA guides that Singapore 2014 construction demand is estimated to be between $31-38b (2013: historical high of $35.8b), while the demand should sustain between $25-34b for 2015-16 respectively. The group has been enjoying a healthy level of enquiries for both public and private sector projects. Orderbook stood at $130m, which is expected to be substantially completed by FY14-16. The stock is trading at 5x annualized 2QFY14 P/E. NAV of 30.43¢ as at 31 Jan translates to 1x P/B at yesterday’s close.