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When is timeline for signing the sale of 39 Robinson that will boost the NAV to $1.03.
Profit taking today?
DBS says Tuan Sing is an under-appreciated asset play and a ' buy'
DBS Group Research, in a note on Tuesday, initiated coverage on Tuan Sing with a " buy" call and target price of 38 Singapore cents on potential value-unlocking activities from its Gul Technologies (GulTech) unit, and expected post-pandemic rebound in performance for its core investment properties.
Tuan Sing shares were trading at 26 Singapore cents as at 10.51am on Tuesday, up 2.5 cents or 10.6 per cent.
The target price represents a 60 per cent upside on the stock, analyst Derek Tan said. The stock is currently trading at a five-year low on a price to book value perspective.
Calling the stock an " under-appreciated asset play" and a " deep value play" , Mr Tan said GulTech' s value unlocking could take the form of a divestment or receipt of dividend.
As at Dec 31, 2019, Tuan Sing holds a 44.5 per cent stake in the printed circuit board manufacturer.
Mr Tan noted that GulTech' s contribution to Tuan Sing has grown by a compound annual growth rate of 26 per cent over the past five years.
" This may be a good time for Tuan Sing to reap dividends from GulTech. We believe that an uptrend in the semiconductor cycle could lead to further rapid growth as China&rsquo s integrated circuit production soars," he wrote.
A potential divestment of the " high-growth" unit to streamline Tuan Sing' s portfolio towards its core property business could also bring in an estimated S$270 million, or 23 cents per share.
Meanwhile, Tuan Sing' s property business is expected to remain profitable in 2020, with recovery " imminent" for the company' s two Australian hotels as Covid-19 measures in the country, such as interstate movement restrictions, are relaxed.
These hotels have a large focus on the domestic market, with domestic demand accounting for an estimated 75 per cent of revenue in 2019.
In addition, about SS$165 million in presales from previous projects is set to be recognised over FY20-FY21, with a further boost expected from Tuan Sing' s Peak Residence project.
These should help offer earnings visibility and mitigate the downside stemming from Covid-19, Mr Tan said.
https://www.businesstimes.com.sg/companies-markets/brokers-take-dbs-says-tuan-sing-is-an-under-appreciated-asset-play-and-a-buy
https://www.businesstimes.com.sg/companies-markets/brokers-take-dbs-says-tuan-sing-is-an-under-appreciated-asset-play-and-a-buy
Good job. Keep up the great reporting :-)
soundblaster ( Date: 16-Jun-2020 13:01) Posted:
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Good spot. Hope you took your own advice. :)
soundblaster ( Date: 15-Jun-2020 09:45) Posted:
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| https://researchwise.dbsvresearch.com/ResearchManager/DownloadResearch.aspx?E=feiehkfdhjg Tuan Sing Holdings (TSH SP): BUY Market Cap: US$200m | Average Daily Value: US$0.07m Last Traded Price: S$0.24 Price Target: S$0.38 (Upside 62.4%) Analyst Singapore Research Team [email protected].. Derek TAN +65 6682 3716 [email protected] Under-appreciated asset play · Initiate coverage with BUY and SOTP-based TP of S$0.38 · Attractive valuation at 0.27x P/NAV or -2 SD of 5-year mean · Australian hotel business set to recover with relaxation of COVID-19 measures · Potential value unlocking of Gultech to transform counter into partial tech play Deep value play. We initiate coverage on Tuan Sing with a BUY call and TP of S$0.38, implying upside of c.60%. We see catalysts emerging for Tuan Sing in the medium term through the (i) potential value unlocking activities of a divestment or receipt of dividend from Gul Technologies (Gultech) amongst other non-core businesses, and (ii) rebound in performance of its core investment properties post COVID-19 outbreak. The stock is currently trading at a 5-year low on a P/BV perspective (-2 standard deviation [SD]). Value unlocking of high growth Gul Technologies could reap Tuan Sing S$0.23 per share. Gultech&rsquo s contribution to Tuan Sing has grown by a CAGR of 26% over the past five years. Going forward, we think this may be a good time for Tuan Sing to reap dividends from Gultech. We believe that an uptrend in the semiconductor cycle could lead to further rapid growth as China&rsquo s integrated circuit production soars. In addition, a potential divestment to streamline its portfolio towards its core property business could bring in c.S$270m, in our estimates, or 23 Scts per share (based on a conservative valuation of 11.0x FY20F PE). Property business to remain profitable in 2020. While COVID-19 has impacted Tuan Sing&rsquo s two hotels in Australia, we believe that a recovery is imminent due to the two properties&rsquo large focus on the domestic market (estimated at c.75% of FY19 revenue) and the easing of Australian interstate movement restrictions. On the property development end, c.S$165m of pre-sales from previous projects are set to be recognised over FY20-FY21 with a further boost expected from the Peak Residence project. These should help offer earnings visibility and mitigate the downside stemming from COVID-19. Valuation: SOTP-based TP of S$0.38. We assume a valuation of 11.0x FY20F PE for Gultech, a 65% discount to RNAV, and a further 10% conglomerate discount to obtain an SOTP-based TP of S$0.38. Key Risks to Our View: Resurfacing of COVID-19 could lead to further construction delays and factory disruptions, FX risk, and soft office market. |
50+ percent is very Low to have a successful takeover - and now SGX rules require a fair price for takeover which will have to take reference from NAV too.
No Low ball takeover please - price stays Low so some can accumulate more cheap.
soundblaster ( Date: 14-Jun-2020 12:50) Posted:
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