CWT

CWT: Unrated company visit note by JPM. Good discussion on Singapore's and CWT's positioning in the warehousing and logistics space. Report available on the left "Files" panel for read. Takeaways: - CWT has specifically targeted segments with high barriers to entry and scale benefits, while avoiding "glamor " contracts which are lower margin. - CWT likes the Petrochemicals segment, which has ridden the growth of the industry post govt prioritization in the late 1990s and with future growth to be driven by Jurong Island expansion. - Other attractive segments include: temperate-controlled goods which grew very quickly due to changes in immigration and tourism policies which have resulted in significant changes in eating habits, and bonded goods (eg. wine, which CWT is building the largest specialized wine warehouse in Asean) . - Meanwhile commodities marketing drives 35% of CWT's 1H14 gross profit. - CWT currently trades on 2014 consensus earnings at 8.4x P/E, 12x EV/EBITDA and 2% yield. - Comparables: HPHT 28.5x P/E, 13.1x EV/EBITDA, 7.4% yield Sinotrans 15x P/E, 9.2x EV/EBITDA, 1.8% yield Keppel T&T 15.4x P/E, 23.3x EV/EBITDA, 2% yield