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Hong Leong Asia to raise stake in BRC Asia to 20% for S$68.1 million
Hong Leong Asia (HLA) - the trade and industry arm of the Hong Leong group - is forking out some S$68.1 million to increase its stake in Mainboard-listed steel-reinforcement solutions provider BRC Asia to 20 per cent through two transactions.The first transaction involves Hong Leong Asia Investments - a wholly-owned subsidiary of HLA - which on Aug 28 agreed to subscribe to about 31 million placement shares of BRC Asia at an issue price of S$1.48 apiece. This amounts to a total price of some S$45.9 million.
The issue price was arrived at after negotiations between both parties on a willing-buyer and willing-seller basis, and represents a discount of about 2.06 per cent to the volume weighted average price of S$1.5111 per share for trades executed on the Singapore Exchange for the full market day on Aug 27.
This transaction will require the approval of BRC Asia' s shareholders at an extraordinary general meeting that will be convened. It was however noted that Esteel Enterprise, which currently owns a 68.96 per cent stake in BRC Asia, has given an undertaking to vote in favour of the transaction.
BRC Asia' s board of directors, meanwhile, say that the placement will enhance the company' s balance sheet and strengthen its capital base.
HLA on Aug 28 also simultaneously entered into a sale and purchase agreement with five of BRC Asia' s shareholders for the acquisition of 15 million ordinary shares at a unit purchase price of S$1.48, which amounts to a total cash consideration of S$22.2 million. These shares collectively represent about 6.16 per cent of the total number of issued shares in BRC Asia, excluding the 1.6 million shares that are held as treasury shares.
The five shareholders are Xinsteel Singapore, Nuocheng International Trading & Investment, Toe Teow Heng, Wu Ai Ping and Shi Yong.
The shares involved in both transactions will represent about 16.77 per cent of the total enlarged issued and paid-up share capital of BRC Asia.
Upon completion of the transactions, HLA will own about 54.9 million shares in BRC Asia, or about 20 per cent of the company' s total enlarged issued and paid-up share capital.
Prior to the announcement of these two transactions, HLA owned 8.86 million shares in BRC Asia, or a stake of about 3.64 per cent.
HLA said this would help expand its interest in the building materials sector in Singapore, and increase technology and automation opportunities for both companies.
HLA also cited the example of Prefabricated Prefinished Volumetric Construction (PPVC) building technology, which has synergies in concrete and steel reinforcement solutions. This area also presents opportunities for overseas growth in markets such as China and other South-east Asian countries that are working towards improving productivity in the building and construction sector.
For Q3 FY2021 ended June, BRC Asia reported net profit of S$10.2 million, compared to a net loss of S$2.5 million in the year-ago period. For the nine months ended June, the company' s net profit stood at S$29.3 million, up 46 per cent from S$20.1 million in the corresponding period last year.
Stephen Ho, chief executive of HLA, said: " " This is a unique opportunity to acquire a meaningful stake in BRC, a company steeped in history with a strong focus on innovation and its people.
" There is potential to generate synergy between our concrete and steel reinforcement capabilities as we pursue the path towards technology and automation in Singapore and markets beyond."
The transaction is expected to close before Dec 31, and is not expected to have any material impact on the net tangible assets per share or earnings per share of HLA in its current financial year.
Shares of Hong Leong Asia ended Friday down 2.3 per cent or S$0.02 at 83.5 Singapore cents, while shares in BRC Asia closed 1.3 per cent or S$0.02 higher at S$1.52.
Emm... BRC NAV is $1.164 only.
goodman ( Date: 28-Aug-2021 22:07) Posted:
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This piece of news definitely should do good to this company.
https://shentonwire.net/2021/08/28/hong-leong-asia-to-acquire-20-percent-of-brc-asia/
https://shentonwire.net/2021/08/28/hong-leong-asia-to-acquire-20-percent-of-brc-asia/
Analysts maintain ' buy' on Hong Leong Asia expect transition to new energy space to drive long-term growth
Analysts from UOB Kay Hian and DBS Group Research have maintained their ' buy' calls on Hong Leong Asia (HLA) following its half year ending June results announcement on August 12.UOB Kay Hian analyst John Cheong has kept his target price for HLA unchanged at $1.38 after the company' s 1HFY2021 earnings of $41 million came in line with his expectations.
Looking ahead, Cheong expects HLA' s 44.7%-owned subsidiary, engine manufacturer China Yuchai International, to support HLA' s diesel engine segment earnings with sales for a new product version. " We expect China Yuchai' s earnings to grow by 17% y-o-y for 2021, which remains on track," he says.
In addition, Cheong highlights that demand for building materials continues to recover as construction activities in Singapore resume. " In tandem with the sector recovery, we expect the building materials segment to clock in revenue growth of 30% and earnings growth of 55% yoy for 2021," he explains.
To that end, he anticipates HLA' s earnings in 2021 to grow by a robust 52% y-o-y. " The disposal of the loss-making air-conditioning business, which is expected to complete in 2H2021, will also provide further earnings lift and allow management to concentrate on the profitable segments," he adds.
Cheong is also bullish on HLA' s transition towards new energy segments, which he believes will drive long-term growth. He notes that that China Yuchai has committed research and development (R& D) spending to develop new energy powertrains, and also signed a strategic partnership with Sunlong Bus to develop electric vehicles (EVs) in June.
For DBS analysts Woon Bing Yong and Derek Tan, HLA' s diesel engine sales volume is expected to drop h-o-h, though this will be offset by better margins due to higher prices of new diesel engines and stabilising R& D expenses.
Similar to Cheong, Yong and Tan are also upbeat on HLA' s transformation to become a new energy player, which they say is " on track" . " A successful venture by China Yuchai into the new energy commercial vehicle space could drive a re-rating of the stock closer to its electric vehicle peers," they remark.
They also highlight that the ongoing construction backlog provides visibility for the building materials segment recovery. " Disruption and delays in construction caused by Covid-19 has resulted in a construction backlog estimated at over c.$5.8 billion. We think FY2022 will be a key year in addressing this backlog, and we project building materials segment revenue to $545.2 million," they explain.
The analysts' target price for HLA has decreased to $1.02 from $1.14 previously due to a lower valuation for China Yuchai driven by higher R& D and selling expenses." We have also adjusted our valuation multiple for China Yuchai to a more conservative eight times FY2022 P/E which is near its five-year mean," they add.
As at 2.35pm, shares in HLA are trading 1.5 cents or 1.75% lower at 84 cents.
How did you get this figure of $1.50?
beng1102 ( Date: 13-Aug-2021 09:46) Posted:
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This stock should be at least $1.50.
Joelton ( Date: 13-Aug-2021 09:40) Posted:
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Hong Leong Asia H1 net profit up 110% to S$40.7m
HONG Leong Asia' s net profit rose 110 per cent year on year to S$40.7 million for the half year ended June 2021, boosted by higher sales and revenue in its diesel engines and building materials units.
The industrial conglomerate logged S$2.8 billion in revenue for the period, up 32.8 per cent from S$2.1 billion. Earnings per share stood at 5.45 Singapore cents.
Its engine-making unit Yuchai had 33.8 per cent year-on-year growth in engine units, ahead of China' s transition to more stringent emission standards. In 2018, China finalised China VI standards that would apply to new heavy-duty diesel vehicles nationwide in two stages. Yuchai expects the market for commercial vehicle engines to slow down after a strong " pre-buying effect" in H1 FY2021.
Demand for precast products under BMG Singapore, its building materials unit in Singapore, was strong as government tenders for housing " increased substantially" , the group said in a business update on Thursday.
Hong Leong Asia H1 net profit up 110% to S$40.7m
Hong Leong Asia' s net profit rose 110 per cent year on year to S$40.7 million for the half year ended June 2021, boosted by higher sales and revenue in its diesel engines and building materials units.The industrial conglomerate logged S$2.8 billion in revenue for the period, up 32.8 per cent from S$2.1 billion. Earnings per share stood at 5.45 Singapore cents.
Its engine-making unit Yuchai had 33.8 per cent year-on-year growth in engine units, ahead of China' s transition to more stringent emission standards. In 2018, China finalised China VI standards that would apply to new heavy-duty diesel vehicles nationwide in two stages. Yuchai expects the market for commercial vehicle engines to slow down after a strong " pre-buying effect" in H1 FY2021.
Demand for precast products under BMG Singapore, its building materials unit in Singapore, was strong as government tenders for housing " increased substantially" , the group said in a business update on Thursday.
However, it noted a challenging operating environment in Malaysia due to rising Covid-19 infections and because its government had re-imposed a total nationwide lockdown in June.
Not only has Malaysia' s movement control order disrupted construction projects in Malaysia, it has also interrupted the production of precast concrete components for construction work in Singapore.
" The overall economic recovery is showing signs of slowing down as countries continue to battle the spread of the Delta variant even as they are preparing to open their economies safely," Hong Leong Asia said.
Shares of Hong Leong Asia ended Thursday down 4.5 Singapore cents, or 4.8 per cent, at 89.5 cents.
Very strong profit. Tomorrow short seller will get a squeeze. Let' s help them to buy. lol.
sandban ( Date: 12-Aug-2021 20:26) Posted:
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Pretty good set of numbers!!
https://links.sgx.com/1.0.0/corporate-announcements/V365BSV9ZKM00RGZ/0d1af3827457f5af2cceef71a3bc562228c8ff1ac9cc3b87b00e0a59613f8162
https://links.sgx.com/1.0.0/corporate-announcements/V365BSV9ZKM00RGZ/0d1af3827457f5af2cceef71a3bc562228c8ff1ac9cc3b87b00e0a59613f8162
Are they reporting soon?
Quite a jump today.
Quite a jump today.
Strong tomorrow.
beng1102 ( Date: 24-Jul-2021 11:36) Posted:
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It is now go down to 100MA. I think it time to buy some in anticipation of rebound.
ozone2002 ( Date: 08-Jun-2021 23:42) Posted:
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Last:1.03 
+0.035
recovery play moving up towards its actual worth in value
great spot nonetheless
gd luck dyodd
+0.035recovery play moving up towards its actual worth in value
great spot nonetheless
gd luck dyodd
ozone2002 ( Date: 30-Nov-2020 11:16) Posted:
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1h chart
on w5 ext ew w5
- 1h baseline 920 must hold
- then w5 continue
on w5 ext ew w5
- 1h baseline 920 must hold
- then w5 continue
long term ew
on w5
on w5
Last:0.94 --
more than 20% gain for recovery play
gd luck dyodd
more than 20% gain for recovery play
gd luck dyodd
ozone2002 ( Date: 09-Feb-2021 11:54) Posted:
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Last:0.78 +0.03
retraced recently
ripe for entry on oversold technicals
gd luck dyodd
+0.03retraced recently
ripe for entry on oversold technicals
gd luck dyodd
ozone2002 ( Date: 29-Dec-2020 13:55) Posted:
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Looks like in play now.. cleared 0.77 which is the breakout trigger price. Expect 0.8 and above soon. Maybe will come in the afternoon
stanleytay ( Date: 09-Feb-2021 06:41) Posted:
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