Tuesday, October 26, 2010

OKP Holdings

OKP Holdings: Could see trading interest after posting another strong set of results with 3Q Rev up 4% YoY at $36.6m and Net profit at $4.5m, up 13%YoY and 4.9%QoQ. Co. highlighted that 9mthFY10 was its best ever performance, with record profit after tax at $12.3m and rev of $110.3m. Increase in Grp’s rev was boosted largely by a significant 29% growth in the Construction segment, while Gross Margins remained strong, at 18%, up 9% YoY…..

Grp remains confident abt the construction sector’s long term prospects with the SG govt committed to spend $60b to double existing rail network and grp’s continued strong progress in clinching contract wins, backed by a healthy order book of $327.6m, expected to stretch till 2013...

We note that at current price, grp trades at an annualized Forward P/E of 8.9x FY10 vs peers average of 8.4x, however grp has an estimated $0.22 net cash/share surplus which warrants a premium for its share price. DBSV has Buy rating on stock with $0.70 TP based on 7x FY11 PE + sum of Net cash surplus.

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