Straco

Straco: Straco 3Q14 net profit grew 28% y/y to $19.5m, keeping pace with the 26% revenue growth to $38.6m. Top line was driven by higher visitor numbers (+31%) to its Shanghai Ocean Aquarium and Underwater World Xiamen. For 9M14, the group recorded net profit of $33.3m (+17%) and revenue of $72.9m (+25%). The strong growth is set to continue, as domestic travel in China is expected to grow, underpinned by a series of new measures and spending by the Chinese government to boost the local tourism industry. At $0.725, Straco trades at 15.4x forward P/E and 3.4x P/B. There is currently only one broker that covers the counter; it rates the stock at Buy with TP of $0.78.