2013-01-07 T03 SG (DBS Vickers) (SG) Small Mid Caps Strategy - Small Stocks, Big Growth

www.dbsvickers.
com

Refer to important disclosures at the end of this report
ed: OY / sa: JC

STI : 3,224.80

Analyst
TAN Ai Teng +65 6398 7967
AiTeng@dbsvickers.com

LING Lee Keng +65 6398 7970
leekeng@dbsvickers.com

STOCKS

Source: DBS Vickers

DBS Group Research . Equity 7 Jan 2013
Singapore Market Focus
Small Mid Caps Strategy
Small stocks, big growth
Stronger growth should spur small-mid cap
(SMCs) to outperform
Pick exposure to external markets; ride on
Chinas rebound
O&M interests continue to cascade and centre
around smaller caps
Top picks: Tat Hong, China Merchant, Sound
Global, Ezion, Jaya

SMC to grow 13% vs 9% for large caps (LC).
Singapore SMCs and the DBSV SMC universe have
both outperformed the FSSTIs 20% gain in 2012,
rising 31% and 39% respectively. But, as SMCs
earnings growth is projected to outpace LC at 13% to
9%, we see SMCs having more legs to run and would
continue to beat the STI, which consensus expects to
have a <10% return.

Bank on external growth. Singapore is expected to
lag behind the rest of Asean with little growth and
high inflation this year. We prefer companies with
external growth, particularly those leveraged on Asean.
Our picks are Petra Food, Super Group, Tiger Airways
and Tat Hong, which generate >50% of their sales
from non-Singapore markets, whereas Bumitama sells
globally. Although 70% of Cordlifes sales are
domestic, cord blood banking offers a stable pool of
recurring income. Although CDL Hospitality draws
80% of its income domestically, these are mainly
supported by overseas tourists to Singapore. We
expect the re-rating on Super to continue and have
raised its TP to $3.51.

Ride on Chinas recovery. With no sign of recovery in
exports to major economies like the US and Europe,
China looks set to accelerate other engines of growth
namely investment and consumption. Our
infrastructure picks Sound Global and United
Envirotech are poised to benefit from Chinas will to
improve environmental protection. We believe Midas
will continue to re-rate along with the revival of
Chinas high speed railway programme. Our proxies to
a rebound in Chinas consumption are PCRT (retail)
and China Merchant (traffic flow).

Small mid cap O&M to remain in favour. We
expect a continuation of robust exploration and
production activities for the oil & gas sector. Hence,
stay invested in OSVs players like Ezion, Jaya, Nam
Cheong and ASL Marine.

Price Mkt Cap
Target
Price

Performance (%)
S$ US$m S$
3 mth 12 mth
Rating
Top picks
Tat Hong 1.38 636 1.70 4.2 56.3 BUY
China Merchants Hldgs
(Pacific)
0.82 480 1.20
12.3 32.3
BUY
Sound Global Limited 0.62 647 0.90 18.3 15.0 BUY
Ezion Holdings 1.71 1,246 2.12 31.2 152.6 BUY
Jaya Holdings 0.67 418 0.85 15.7 40.0 BUY

Other stock picks
Asean growth exposure
Bumitama Agri 1.08 1,548 1.25 3.9 N.A BUY
CDL Hospitality Trusts 1.93 1,525 2.11 (7.2) 22.2 BUY
Far East Hospitality Trust 0.985 1,294 1.09 (6.6) N.A BUY
Cordlife Group Ltd 0.56 105 0.65 (3.5) N.A NOT
Petra Food 3.49 1,740 3.97 45.4 88.7 BUY
Super Group Ltd 3.23 1,469 3.51 38.0 136.6 BUY
Tiger Airways Holdings 0.74 492 0.95 (2.7) 13.1 BUY

China Come Back
Midas Holdings 0.46 452 0.50 5.8 30.0 BUY
Perennial China Retail Trust 0.59 544 0.84 17.0 21.9 BUY
United Envirotech 0.52 201 0.69 47.1 68.9 BUY

More Legs to O&M
ASL Marine 0.68 234 0.90 0.0 33.3 BUY
Nam Cheong Ltd 0.27 414 0.30 17.8 96.3 BUY

foosuanyee@imci.sg FooSuan Yee 05/23/14 06:06:25 AM IMC INVESTMENTS PTE. LTD.
Market Focus

Page 2
Table of Contents

SMC outperformed in 2012 3
2013: Asia leads global, China leads Asia 4
Theme #1: Asean growth exposure 5
Theme #2: China comeback 8
Theme #3: More legs to O&M 9
Key data for stock pick 10

Stock Profiles
Tat Hong 12
China Merchants Hldgs (Pacific) 14
Sound Global Limited 16
Ezion Holdings 18
Jaya Holdings 20
Bumitama Agri 22
CDL Hospitality Trusts 24
Far East Hospitality Trust 26
Cordlife Group Ltd 28
Petra Food 30
Super Group Ltd 32
Tiger Airways Holdings 34
Midas Holdings 36
Perennial China Retail Trust 38
United Envirotech 40
ASL Marine 42
Nam Cheong Ltd 44
Analysts

TAN Ai Teng +65 6398 7967


Market Focus

Page 3
SMC outperformed in 2012

2012 was plagued by a slew of negative events. Key issues
affecting the market were the European crisis and the
slowdown in the major global economies - US, China and
Europe. The ECBs second long-term refinancing operation
(LTRO) in February spurred the market higher but worries
about the Eurozone debt crisis and a slowdown in global
economies continued to haunt investors. By June, the market
was back to where it started. Valuations have fallen to
attractive levels and the market staged an oversold rebound
subsequently. Back home, the risk of our economy falling into
recession and the high inflation environment continue to affect
market sentiment.

Against this backdrop, the small-mid caps (SMC) indices FTSE
mid cap (FSTM) and FTSE Small Cap (FSTS) managed to
outperform the larger-cap STI, gained 31.7% and 30.7% for
2012 respectively, vs 19.7% for the STI. DBSV SMC index has
also done well, +38.7% for 2012.

In terms of stocks, a handful of the SMC stocks surged a few
fold YTD. At the top of the list were Myanmar plays like Interra
Resources, Yoma Strategic and Aussino Group. Other top
performers in our coverage list include O&M plays that we
highlighted in our previous SMC report like Ezion, Nam
Cheong and AusGroup. Our other picks like Wing Tai,
Silverlake Axis and Midas also did well, up about 20% since
their inclusion.

Index performance

Relative performance

SMC still trades at a discount to large caps despite
outperformance
SMC stocks are still trading at a 10% discount to large caps
despite their outperformance, albeit at a lower discount rate of
about 20% for the past two years. Current P/E for DBSV SMCs
is 14.3x, vs 15.1x for their large caps peers.

FY12F earnings for SMCs, however, are expected to register
slight negative growth of 0.5% vs 3.7% growth for the LC,
mainly due to weak earnings from the Basic Materials,
Consumer Services and Oil and Gas sectors. The Basic Materials
sector was mainly dragged down by Midas, due to lack of
contract wins but the stock should re-rate once contracts start
to flow in again for the group. We expect Midas to turn
around soon. Tiger Airways is another turnaround stock and is
expected to lead the Consumer Services sector to a strong
growth of 162% for FY13F. Meanwhile, the Oil and Gas sector
was affected by STX OSV, on lesser contract wins and margins
squeeze.

Valuation gap

Source: DBS Vickers

Earnings growth

-50
-40
-30
-20
-10
0
10
20
2005 2006 2007 2008 2009 2010 2011 2012
PE (%)
95
100
105
110
115
120
125
130
135
140
145
STI Index FSTM Index FSTS Index DBSV Small Mid Cap
-4
0
4
8
12
16
20
24
2009A 2010A 2011A 2012F 2013F 2014F
(%)
Small/Mid Cap Big Cap
Closed as at
31.12.12
1 mt h (%)
30.11.12
3 mt hs (%)
30.9.12 YTD (%)
Index
STI 3,167 3.2 3.6 19.7
FTSE Mid Cap 773 2.8 4.7 31.7
FTSE Small Cap 521 6.4 4.3 30.7
Source: Bloomberg
Source: DBS Vickers
Market Focus

Page 4

Growth and valuation: LCs vs SMCs

Source: DBS Vickers

2013: Asia leads global, China leads Asia

2013 in general is likely to present a more stable financial
environment than 2012, amid an easing Euro crisis, improving
visibility in China, and a modestly recovering US economy. Our
chief economist expects 2% growth in the US and a further
mild contraction in the Eurozone in 2013. Asia, thus, will
continue to lead growth, just like in the past four years where
growth is self-generated and not dependent on the US or the
Eurozone. As long as these other major economies do not
collapse, Asias acceleration will come from China. We are
looking at growth returning to 9% in China and 6% in Asia-
10.

The Chinese economy has probably bottomed in 3Q12 and
Chinas acceleration in fixed asset investment will certainly be
able to help lift global growth, and urbanisation is the new
strategy to spearhead investment

Growth coming from Asia

2012F 2013F 2014F 2012F 2013F 2014F
Basic Materials 182.2 17.3 11.0 -92% 955% 57%
Consumer Goods 14.1 13.0 11.5 -5% 8% 13%
Consumer Services 45.1 17.2 14.7 nm 162% 17%
Financials 15.0 15.3 15.0 12% -2% 2%
Health Care 15.9 13.4 13.8 26% 19% -3%
Industrials 13.3 11.1 9.8 -2% 20% 13%
Oil & Gas 10.0 9.0 7.6 -26% 11% 18%
Real Estate 11.0 11.2 9.4 -24% -2% 19%
REITS 17.6 15.6 15.5 21% 12% 1%
Technology 14.4 13.1 12.1 3% 10% 9%
Telecommunications 14.6 14.5 13.8 2% 1% 5%
Smal l /Mi d Cap Total 14. 7 13. 0 11. 9 -0. 5% 12. 9% 9. 7%
Consumer Goods 14.4 11.8 10.4 -29% 22% 14%
Consumer Services 22.6 19.5 17.3 -11% 16% 13%
Financials 24.5 21.7 20.2 -7% 13% 8%
Health Care 38.7 33.4 28.3 209% 16% 18%
Industrials 14.9 13.2 12.3 14% 13% 7%
Real Estate 20.7 19.1 16.1 1% 9% 18%
REITS 21.1 19.4 18.2 -1% 8% 7%
Telecommunications 14.7 14.1 13.8 1% 4% 2%
Banking 12.0 11.7 10.7 13% 3% 10%
Large Cap 15. 9 14. 6 13. 4 3. 7% 8. 6% 9. 5%
DBSV Coverage 15. 7 14. 4 13. 1 3. 1% 9. 3% 9. 5%
Earni ngs Growth PE ( x)
Market Focus

Page 5

Theme #1: Asean growth exposure

Notwithstanding robust expansion in Asia, growth in Singapore
is expected to remain below potential on account of structural
weaknesses. Singapores economic woes include the tightening
in foreign labour inflows, strong S$ leading to falling export
competitiveness, high COE premiums and high rentals; all of
which imply that Singapore will continue to underperform its
potential as well as against the regional peers. Overall, we
expect Singapore GDP growth to register 3.2% in 2013, from
1.6% in 2012. Inflation is likely to stay sticky at 4% next year,
still two times higher than historical average.

Therefore, companies here, in particular the smaller SMCs, are
faced with higher cost pressures and risks of lower margins. To
seek growth, we suggest picking companies with a diversified
earnings base, in particular one that is leveraged for growth in
other Asean countries. Except for Singapore, other Asean
economies are projected to grow in excess of 5%.

GDP growth and inflation growth projections

Market Focus

Page 6
Companies with exposure to Asean include CDL Hospitality Trust, Petra Food, Super Group, Bumitama, Tiger Airways, Tat Hong
and Cordlife.

Estimated revenue exposure by geography
Company Singapore Asean North
Asia
Others Remark
Cordlife 72% -

26% - Though the bulk of the revenue is generated from Singapore, cord
blood banking offers a stable pool of recurring income, with >50%
of its customers on an annual payment scheme.

Petra Food 4% 30% 6% 60% Exposure to the domestic market is minimal. Petra has an estimated
55% market share of the Indonesias chocolate confectionery
market and a 10% market share of the Philippines market.

Bumitama n.a. n.a. n.a. n.a. Bumitama sells its CPO to refineries in Indonesia which is in turn
sold globally.

Tiger Airways n.a. n.a. n.a. 50% Its Australian operation contributes about 50% to total revenue; the
rest are from its Singapore operation

Tat Hong 10% 35% 10% 55% About half of its revenue is from Australia and the balance from
Asia

Super 11% 63% 20% 6% The bulk of its revenue are from Asia

CDL
Hospitality
- 50% 18% 32% About 85% of its customers are from Asia, of which about half is
from China, Indonesia and India

Source: DBSV estimates

CDL Trust
We just upgraded CDL Hospitality Trust (CDREIT) to Buy post a
surprise sale-and-leaseback transaction of Angsana Velavaru
Maldives from Banyan Tree Holdings. In our view, the deal
poses more upside in the medium term, underpinned by the
robust growth outlook of the Maldives hospitality market and
put the trust back to growth path. We raised our numbers by
c3.2-3.7% post this acquisition.
Far East H-Trust

Far East Hospitality Trust (Far East H-Trust) is a pure play into
Singapore Hospitality sector with an industry leading position.
It offers investors exciting exposure to Singapores growing
hospitality sector. It has a reputable sponsor (part of Far East
Organization), with a visible pipeline.

Super Group
Super enjoys extensive exposure in Asean with interests in
consumer staple markets of Thailand, Myanmar, and Malaysia.
It is also exposed to the Philippines and Indonesia through JV
partners. We estimate that Super derives c.65% of its
revenues in Asean markets outside of Singapore. We now
anticipate a slightly better outlook in FY13F as raw material
prices have performed more favourably than our price
assumptions in 4Q12. We believe margins will expand in
FY13F, and now position the stock at a higher valuation of
20x, in line with the sector, which has re-rated due to a lower
cost outlook in FY13F.

Petra Food
Petra Food is an interesting play on Indonesias growth. With
the disposal of its Cocoa Ingredients business, Petra will now
focus purely on the branded chocolate confectionery business.
With an estimated 55% share of the Indonesian market, Petra
offers investors an exposure into Indonesias consumption
growth. The group also has a 10% market share of the
chocolate confectionery market in the Philippines.

Bumitama
Bumitama is our top pick for the sector. We believe the stock is
undervalued considering its strong growth outlook. Bumitama
remains the best-in-class with CPO production growth of 29%
p.a. over the next three years. We expect the group to book
FY12F-15F earnings CAGR of 17%, despite expectations of flat
CPO prices.

Market Focus

Page 7
Tiger Airways
Tiger has been reporting improving operations data in recent
months, with the potential of an earnings turnaround in 3Q-
FY13. Growth at Tiger Singapore will be key to restoring
profitability in the near term. With growth expecting to return
to 9% in China and 6% in Asia-10, Tiger is well positioned to
ride on this trend, with its portfolio of airlines in Singapore, the
Philippines and Indonesia.

Tat Hong
Tat Hong is one of the largest crane distribution/rental
companies in the world. We are positive on fleet utilisation and
rental rates going forward, supported by robust crane demand
in contrast to the tight crane supply situation in the market.

Cordlife
A market leader in cord blood banking, Cordlife offers stable
recurring income as >50% of its customers are on an annual
payment scheme. An increasing penetration rate and
awareness of cord blood banking are expected to drive
growth. Catalysts would include potential acquisitions in
Indonesia, India and the Philippines. The stock also offers an
attractive dividend yield of about 4%.

Market Focus

Page 8
Theme #2: China comeback

The Chinese economy has probably bottomed out in 3Q12.
Our China/Hong Kong economist is looking at growth
returning to 9%. Chinas acceleration in fixed asset investment
will certainly be able to help lift global growth, and
urbanisation is the new strategy to spearhead investment.
Chinas investment efficiency is higher than any other country
in Asia, except for Singapore (chart below). Its incremental
capital-output ratio (ICOR) is among the highest. The chart
below show the inverse of ICOR, so lower is better. Overall,
China is expected to lead growth in Asia. More recent macro
data are pointing towards a recovery in China. The current
recovery is assisted by re-stocking, translating into improving
PMI readings. On the consumption front, retail sales have
remained steady. In terms of stock picks, potential
beneficiaries of a recovery in the Chinese economy and/or
government spending are Midas, Sound Global, United
Envirotech, PCRT

China GDP growth

China efficiency of investment

Chin

China fixed asset investment growth % YoY
10
15
20
25
30
35
40
45
05 06 07 08 09 10 11 12
FAI YTD FAI YTD new construction
(%)

Source: Datastream, DBS

FAI major sector weights vs % YoY growth
0
5
10
15
20
25
30
35
0
5
10
15
20
25
30
35
40
share of total FAI (L) %YoY (R)
(%) %YoY

Source: Datastream, DBS

Market Focus

Page 9
Midas
Midas is poised for a turnaround. The group has enhanced
both its capacity and capabilities during this lull period.
Winning more orders from wider sources should boost the
groups earnings prospects. Impending high speed train orders
from Chinas MOR could be a catalyst for re-rating.

Sound Global
A pacesetter in Chinas water industry, SGL is well-positioned
to benefit from Chinas growing awareness in environmental
protection. In particular, we see huge potential from rural
developments for SGL as this market is largely underpenetrated
and only about 1% of sewage in the rural areas is treated.
While SGL continues to garner EPC contracts for municipal and
expansion/upgrade of existing wastewater treatment plants in
matured cities, the company will maintain its pursuit for BOT
and O&M projects to build a recurring earnings base.

SGLs earnings and growth is backed by a record orderbook of
>Rmb3bn. We are confident the company is able to maintain
earnings growth in the region of 20%. Post the last contract
announcement, we have raised FY13/14F earnings to account
for expected revenue recognition. Our TP of S$0.90 remains
intact. Maintain BUY.

United Envirotech
We recently initiated coverage on United Envirotech (UENV)
with a TP of S$0.70. As one of the leading membrane-based
water and wastewater treatment companies in China, UENV
should be a key beneficiary of Chians rapid growth in the
environmental protection sector, with earnings CAGR in excess
of 40% from FY2013-FY2015.

More importantly, we noted that >60% of profits will be
coming from long-term recurring treatment income following a
series of acquisitions of operating water plants in China. By
FY14Mar, UENV would have a total processing capacity of
1.18m m3/day to generate S$25m or 60% of group PATMI.
This treatment income is recurring for the life of the water
concessions (30 years).

In addition, UENV has a potential upside from higher
utilisation rates and Phase 2 expansion or acquisitions.

Our sum-of-parts TP is based on 10x PE for EPC and DCF
valuation (8.6% WACC) for treatment. We have also assumed
full dilution of the S$136.2m convertible bond to Kholberg
Kravis Roberts & Co (KKR).

Perennial China Retail Trust
PCRT is a pure China retail play with a high dividend yield.
There are plenty of drivers from the portfolio ramp up and new
investments. We see FY13 as an earnings inflexion point with
new contributions from the Perennial Jihua Mall Foshan
development.

China Merchant
Driven by its recent toll road acquisitions, as well as the
expected bounce in the Chinese economy, CMP will more than
double its core earnings from HK$261m in 2010 to HK$54m in
2014 (EPS CAGR of 24%). CMP is also in a strong position to
continue growing, by looking at more toll road assets, either
from its parent or third-parties.

CMP currently trades at 0.9x FY12 P/B, and just 9.3x fully
diluted FY13 PE whilst offering an attractive yield of nearly 7%.
Our target price of S$1.20 is based on DCF, adjusted to S$1.13
if all the CBs were converted.

Theme #3: More legs to O&M

Offshore orders were buoyant in 2012, on robust sector
fundamentals. firm rig utilisation and day rates, supported by
improving demand/supply dynamics. We still expect a robust
outlook for oil & gas E&P activities to continue in 2013. The
subsea market is expected to register robust growth in the
future, backed by an increase in the development of oil and
gas fields in deeper waters/harsher environments, coupled with
aging offshore oil and gas infrastructure, which require regular
repair/maintenance, especially on the back of increasingly
stringent requirements on operational safety. OSVs players like
Ezion, Nam Cheong, ASL Marine and Jaya are the key
beneficiaries.

Ezion
We are impressed with Ezions rapid and successful expansion
into new geographical markets (Gulf of Mexico, North Sea,
Southeast Asia), its growing traction with major oil companies
(Pemex, Maersk Oil, Pertamina, Petronas), and scaling up the
value chain (time charters from bareboat). Ezions robust FY12
order wins are expected to support FY11-14 EPS CAGR of
41%. We like Ezion for its strong execution and earnings
delivery, high earnings visibility, solid earnings growth and
undemanding valuations. We see potential catalysts from more
contract wins.

Market Focus

Page 10
Nam Cheong
Nam Cheong is on track for strong growth, backed by healthy
recurrent demand for OSVs both in Malaysia and overseas.
FY12 is now a record year for Nam Cheong with 21 vessels
sold during the year. It has now also sold more than half of its
19 vessel build-to-stock models for FY13. Its order book was
close to record level of RM1.5bn in end-2012, and should drive
healthy earnings growth in FY13/14. We expect more order
flows from Petronas-linked projects in Malaysia in 1H FY13, as
activity on the ground picks up steam. Nam Cheong is in a
sweet spot as it is the largest builder of OSV vessels for
Malaysian waters. We remain comfortable with our projection
of close to 30% earnings CAGR over FY11-13.

Jaya
We see Jaya as a recovery play as the group has repositioned
itself as a services provider to the offshore energy sector. We
believe Jayas earnings troughed in FY12 and project FY12-14F
EPS CAGR of 54%, driven primarily by the Offshore Support
division on a larger fleet, improved day rates, and better
margins. With a clearer focus and less volatile earnings, we
believe Jaya now offers a more attractive investment
opportunity.

Key data for stock pick

Per share data based on full conversion of CBs; PATMI growth of 156% and 75% for FY13F and FY14F respectively
Source: DBS Vickers

Mkt Pri c e Ta rge t EPS EPS Pri c e / Di v Ne t De bt/ 6 mth a vg
Ca p (S$) Pri c e % Gth (%) Gth (%) PE (x) PE (x) BV (x) Yl d (%) Equi ty da i l y va l ue
Compa ny (S$m) 04-Ja n (S$) Ups i de Rc md 13F 14F 13F 14F 12F 13F 11A (S$,000)
As e a n growth e xposure
1 Bumitama 1,889.3 1.08 1.25 16 Buy 8.2 29.5 13.9 12.4 3.91 0.0 0.50 2,635
2 CDL Hospitality 1,884.2 1.95 2.11 8 Buy 3.2 3.5 16.4 15.8 1.22 6.1 0.26 3,705
3 Cordlife 130.3 0.56 0.65 16 NR 28.0 12.0 14.7 13.1 1.83 3.4 cash 1,600
4 Far East H-Trust 1,587.9 0.99 1.09 10 Buy 20.2 7.3 18.5 17.9 1.06 5.9 0.31 6,389
5 Petra 2,187.9 3.58 3.97 11 Buy 4.8 27.4 31.5 24.7 5.48 1.6 1.81 761
6 Super 1,767.4 3.17 3.51 11 Buy 50.6 27.8 18.1 15.9 4.35 2.8 cash 1,341
7 Tat Hong 777.3 1.37 1.70 24 Buy 13.0 15.8 9.6 8.3 1.27 1.8 0.62 946
8 Tiger 595.0 0.73 0.95 31 Buy nm 36.4 12.7 9.3 1.70 0.0 1.27 1,417
Chi na c ome ba c k
9 China Merchants 596.1 0.83 1.20 44 Buy 44.4 0.5 8.3 7.3 0.97 6.6 0.55 91
10 Midas 547.9 0.45 0.50 11 Buy 954.7 56.8 18.5 11.8 0.95 1.1 0.18 3,915
11 PCRT 666.5 0.59 0.84 44 Buy nm nm 111.0 59.5 0.82 7.0 0.27 896
12 Sound Global 832.1 0.65 0.90 39 Buy 9.8 13.4 9.4 8.3 1.87 2.1 cash 735
13 United Envirotech * 246.6 0.52 0.69 35 Buy 149.2 8.3 8.7 7.2 1.25 1.6 0.86 526
More l e gs to O&M
14 ASL Marine 289.1 0.69 0.90 31 Buy 52.1 22.9 5.9 4.8 0.82 3.4 0.52 107
15 Ezion 1,532.5 1.71 2.12 24 Buy 77.2 40.3 10.7 7.6 3.09 0.1 0.87 10,665
16 Jaya 512.1 0.67 0.85 28 Buy (61.3) 86.4 11.9 9.3 0.85 0.0 0.09 368
17 Nam Cheong 507.0 0.27 0.30 14 Buy 34.0 26.1 8.1 7.4 2.16 1.3 0.35 2,121
Market Focus

Page 11

Stock Profile

Page 12
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: TAT SP
|
Reuters: TAT.SI

BUY S$1.375 STI : 3,224.80

Price Target : 12-month S$ 1.70
Potential Catalyst: Higher utilisation and rental rates
DBSV vs Consensus: Higher on more regional developments

Analyst
Alfie YEO +65 6398 7957
AlfieYeo@dbsvickers.com

HO Pei Hwa +65 6398 7968
PeiHwa@dbsvickers.com
Price Relative
53
73
93
113
133
153
173
193
213
0.5
0.6
0.7
0.8
0.9
1.0
1.1
1.2
1.3
1.4
1.5
Jan-09 Jan-10 Jan-11 Jan-12 Jan-13
Relative Index
S$
Tat Hong (LHS) Relative STI INDEX (RHS)

Forecasts and Valuation

FY Mar (S$ m) 2011A 2012A 2013F 2014F
Turnover 584 720 895 963
EBITDA 116 151 205 214
Pre-tax Profit 41 58 105 116
Net Profit 26 42 72 81
Net Pft (Pre Ex.) 26 46 72 81
EPS (S cts) 4.6 7.4 12.6 14.2
EPS Pre Ex. (S cts) 4.6 8.0 12.6 14.2
EPS Gth (%) (33) 63 69 13
EPS Gth Pre Ex (%) (33) 76 57 13
Diluted EPS (S cts) 4.6 7.4 12.6 14.2
Net DPS (S cts) 1.5 2.5 2.5 2.5
BV Per Share (S cts) 91.1 97.7 107.7 119.4
PE (X) 30.2 18.5 10.9 9.7
PE Pre Ex. (X) 30.2 17.2 10.9 9.7
P/Cash Flow (X) nm 7.5 13.0 8.2
EV/EBITDA (X) 10.2 8.0 6.1 5.7
Net Div Yield (%) 1.1 1.8 1.8 1.8
P/Book Value (X) 1.5 1.4 1.3 1.2
Net Debt/Equity (X) 0.6 0.6 0.6 0.5
ROAE (%) 5.1 7.9 12.2 12.5

Earnings Rev (%): - -
Consensus EPS (S cts): 12.3 14.1
Other Broker Recs: B: 8 S: 0 H: 0

ICB Industry : Industrials
ICB Sector: Industrial Engineering
Principal Business: Heavy equipment distributor and crane rental
company.
Source of all data: Company, DBS Vickers, Bloomberg

At A Glance
Issued Capital (m shrs) 567
Mkt. Cap (S$m/US$m) 780 / 636
Major Shareholders
Chew Cheng & Sons (%) 44.7
Ng Chwee Cheng (%) 9.8
Free Float (%) 45.5
Avg. Daily Vol.(000) 517

Tat Hong
Positive on tight crane supply

One of the largest crane distribution/rental
companies in the world
Positive on fleet utilisation and rates on tight
crane supply cranes
Maintain BUY, TP S$1.70

One of the largest crane distribution/rental
companies in the world. Tat Hong (TAT) is one of the
world's largest crane companies in the world. In June
2011, International Cranes & Specialized Transport
magazine's IC50 Ranking positioned TAT first in terms
of fleet size of crawler cranes and eighth in terms of
aggregate tonne-metres.
Expect better utilisation, rental rates. Both crawler
and tower crane rental utilisation rates improved (+4.6
ppt to 72.5%/+9ppt to 79.7%, respectively) on
increased construction activities across Asean, Hong
Kong and mining/resource activities in Australia. We
are positive on fleet utilisation and rental rates going
forward, supported by robust crane demand in contrast
to the tight crane supply situation in the market.
Regional construction projects and oil & gas projects in
Australia remain buoyant, while limited production
capacity of crane manufacturers will ensure that crane
rental demand continues to outstrip crane supply.
Hence, we remain optimistic on TATs fleet utilisation
and rental rates going forward.
Maintain BUY, TP S$1.70. TAT currently trades at
10.9x FY14F PE. Our valuation of the stock based on
12x FY14F earnings is S$1.70. P/BV multiple is also
attractive at 1.3x against an ROE of 12.2%. Maintain
BUY for 26% upside


Tat Hong

Page 13

Income Statement (S$ m) Balance Sheet (S$ m)
FY Mar 2011A 2012A 2013F 2014F FY Mar 2011A 2012A 2013F 2014F

Turnover 584 720 895 963 Net Fixed Assets 624 765 766 728
Cost of Goods Sold (376) (457) (557) (602) Invts in Associates & JVs 67 66 76 86
Gross Profit 209 263 337 361 Other LT Assets 56 56 56 56
Other Opng (Exp)/Inc (151) (182) (220) (233) Cash & ST Invts 62 77 43 85
Operating Profit 57 81 117 128 Inventory 201 234 298 321
Other Non Opg (Exp)/Inc 0 0 0 0 Debtors 145 185 224 241
Associates & JV Inc 1 1 10 10 Other Current Assets 0 0 0 0
Net Interest (Exp)/Inc (17) (21) (22) (23) Total Assets 1,154 1,383 1,463 1,517
Exceptional Gain/(Loss) 0 (3) 0 0
Pre-tax Profit 41 58 105 116 ST Debt 165 174 174 174
Tax (9) (22) (24) (25) Other Current Liab 157 309 323 301
Minority Interest (6) 6 (9) (9) LT Debt 245 282 282 282
Preference Dividend 0 0 0 0 Other LT Liabilities 16 20 20 20
Net Profit 26 42 72 81 Shareholders Equity 519 556 614 680
Net Profit before Except. 26 46 72 81 Minority Interests 53 42 51 60
EBITDA 116 151 205 214 Total Cap. & Liab. 1,154 1,383 1,463 1,517

Sales Gth (%) 17.9 23.2 24.3 7.7 Non-Cash Wkg. Capital 189 110 199 261
EBITDA Gth (%) (4.1) 29.9 35.5 4.6 Net Cash/(Debt) (348) (379) (413) (371)
Opg Profit Gth (%) (20.7) 41.4 44.3 9.9
Net Profit Gth (%) (32.8) 62.8 69.4 13.0
Effective Tax Rate (%) 21.9 37.1 23.3 22.0
Cash Flow Statement (S$ m) Rates & Ratio
FY Mar 2011A 2012A 2013F 2014F FY Mar 2011A 2012A 2013F 2014F

Pre-Tax Profit 41 58 105 116 Gross Margins (%) 35.7 36.5 37.7 37.5
Dep. & Amort. 59 70 79 77 Opg Profit Margin (%) 9.8 11.2 13.1 13.3
Tax Paid (9) (12) (11) (24) Net Profit Margin (%) 4.4 5.9 8.0 8.4
Assoc. & JV Inc/(loss) (1) (1) (10) (10) ROAE (%) 5.1 7.9 12.2 12.5
Chg in Wkg.Cap. (112) (41) (103) (63) ROA (%) 2.4 3.3 5.0 5.4
Other Operating CF 20 31 0 0 ROCE (%) 4.8 4.9 8.1 8.5
Net Operating CF (2) 104 60 95 Div Payout Ratio (%) 32.9 33.7 19.9 17.6
Capital Exp.(net) (52) (82) (80) (39) Net Interest Cover (x) 3.3 3.8 5.3 5.6
Other Invts.(net) 0 0 0 0 Asset Turnover (x) 0.5 0.6 0.6 0.6
Invts in Assoc. & JV 0 0 0 0 Debtors Turn (avg days) 80.6 83.7 83.3 88.0
Div from Assoc & JV 1 2 0 0 Creditors Turn (avg days) 189.0 210.5 227.1 199.0
Other Investing CF (3) 4 0 0 Inventory Turn (avg days) 231.1 204.7 202.8 214.9
Net Investing CF (54) (76) (80) (39) Current Ratio (x) 1.3 1.0 1.1 1.4
Div Paid (14) (9) (14) (14) Quick Ratio (x) 0.6 0.5 0.5 0.7
Chg in Gross Debt 120 11 0 0 Net Debt/Equity (X) 0.6 0.6 0.6 0.5
Capital Issues 0 0 0 0 Net Debt/Equity ex MI (X) 0.7 0.7 0.7 0.5
Other Financing CF (62) (16) 0 0 Capex to Debt (%) 12.7 18.0 17.4 8.4
Net Financing CF 44 (13) (14) (14) Z-Score (X) 1.5 1.6 1.9 2.1
Currency Adjustments (1) 0 0 0 N. Cash/(Debt)PS (S cts) (61.0) (66.6) (72.5) (65.0)
Chg in Cash (14) 15 (34) 42 Opg CFPS (S cts) 19.4 25.5 28.6 27.8
Free CFPS (S cts) (9.5) 3.8 (3.4) 9.9
Quarterly / Interim Income Statement (S$ m) Segmental Breakdown / Key Assumptions
FY Mar 3Q2012 4Q2012 1Q2013 2Q2013 FY Mar 2011A 2012A 2013F 2014F

Turnover 196 182 215 216 Revenues (S$ m)
Cost of Goods Sold (129) (110) (131) (136) Equipment Sales 272 339 375 374
Gross Profit 67 72 84 80 Crane Rental 185 225 338 383
Other Oper. (Exp)/Inc (44) (53) (54) (52) General Equipment Rental 70 97 106 120
Operating Profit 23 18 31 28 Tower Crane Rental 57 59 75 86
Other Non Opg (Exp)/Inc 0 0 0 0
Associates & JV Inc 0 1 2 3 Total 584 720 895 963
Net Interest (Exp)/Inc (6) (4) (6) (6)
Exceptional Gain/(Loss) 0 (3) 0 0 Key Assumptions
Pre-tax Profit 18 11 26 25 Crawler average fleet size 539.9 595.8 759.2 770.0
Tax (4) (9) (7) (5) Crawler utilisation (%) 61.6 67.3 74.1 77.0
Minority Interest (1) 9 (2) (2) Tower average fleet size 653.3 712.0 784.2 790.0
Net Profit 13 11 17 17 Tower utilisation (%) 72.7 66.1 74.7 75.0
Net profit bef Except. 13 14 17 17
EBITDA 42 39 51 51

Sales Gth (%) 7.0 (7.3) 18.3 0.3
EBITDA Gth (%) 0.5 (6.4) 30.3 (1.1)
Opg Profit Gth (%) (5.5) (22.6) 69.3 (8.6)
Net Profit Gth (%) 2.7 (13.7) 48.9 4.0
Gross Margins (%) 34.4 39.4 39.2 37.2
Opg Profit Margins (%) 12.0 10.0 14.3 13.0
Net Profit Margins (%) 6.6 6.1 7.7 8.0

Source: Company, DBS Vickers

Page 14
www.dbsvickers.com

ed: JS / sa: JC

Bloomberg: CMH SP
|
Reuters: CAEP.SI

BUY S$0.82 STI : 3,224.80

Price Target : 12-Month S$ 1.20
Potential Catalyst: Earnings execution; more acquisitions
DBSV vs Consensus: We are only major broker to cover the stock

Analyst
Paul YONG CFA +65 6398 7951
paulyong@dbsvickers.com

Price Relative
49
69
89
109
129
149
169
189
209
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Relative Index
S$
China Merchants Hldgs (Pacific) (LHS) Relative STI INDEX (RHS)


FY Dec (HK$ m) 2011A 2012F 2013F 2014F
Turnover 847 1,548 1,984 2,129
EBITDA 736 1,298 1,664 1,789
Pre-tax Profit 538 1,158 1,035 1,032
Net Profit 314 722 579 574
Net Pft (Pre Ex.) 314 453 501 574
EPS (S cts) 6.9 15.9 11.6 11.5
EPS Pre Ex. (S cts) 6.9 10.0 10.0 11.5
EPS Gth (%) 20 130 (27) (1)
EPS Gth Pre Ex (%) 43 44 1 14
Diluted EPS (S cts) 5.9 8.5 9.4 10.7
Net DPS (S cts) 5.4 5.5 5.5 6.0
BV Per Share (S cts) 77.2 86.1 99.3 104.8
PE (X) 11.9 5.2 7.1 7.2
PE Pre Ex. (X) 11.9 8.3 8.2 7.2
P/Cash Flow (X) 9.7 9.1 3.0 3.8
EV/EBITDA (X) 10.7 7.8 7.1 6.2
Net Div Yield (%) 6.5 6.7 6.7 7.3
P/Book Value (X) 1.1 1.0 0.8 0.8
ROAE (%) 7.7 16.4 11.6 10.4

Earnings Rev (%): - - -
Consensus EPS (S cts): 5.0 5.2 8.7

ICB Sector: Industrial Transportation
Principal Business: Owns and operates toll roads in various provinces
in China.

At A Glance
Mkt. Cap (S$m/US$m) 592 / 483
Major Shareholders
China Merchants (%) 82.6
Free Float (%) 17.4
China Merchants Hldgs (Pacific)
Good yield with acquisitions-
driven earnings growth

CMP has acquired 3 quality expressways in the
last 18 months and has transformed into a
quality, China pure expressway play

More acquisitions could be on the way as the
Group scales up and builds its track record

CMP commitment to pay at least S 5.5cts annual
dividend provides firm dividend yield of c. 7%
Maintain BUY, with TP of S$1.20

CMP has successfully restructured itself. Since
mid-2011, CMP has bought three expressways in
China totaling 238km, whilst disposing off a Class II
highway (for a gain) and its non-core property
business. These transactions transform CMP into a
pure PRC expressway list co, and one of the few
with toll roads assets in multiple provinces.

Bright outlook driven by China economic growth
and acquisitions. Driven by its recent toll road
acquisitions, as well as the expected firm bounce in
the Chinese economy, CMP will more than double
its core earnings from HK$261m in 2010 to
HK$54m in 2014 (EPS CAGR of 24%).

CMP is also in a strong position to continue
growing, by looking at more toll road assets, either
from its parent or third-parties.

Compelling valuations as the stock is trading
below book and offering a yield of c. 7%; BUY.
CMP is trading at 0.9x FY12 P/B, and just 9.3x fully
diluted FY13 PE whilst offering an attractive yield of
nearly 7%. Our target price of S$1.20 is based on DCF,
adjusted to S$1.13 if all the CBs were converted.


China Merchants Hldgs (Pacific)

Page 15

Income Statement (HK$ m) Balance Sheet (HK$ m)
FY Dec 2011A 2012F 2013F 2014F FY Dec 2011A 2012F 2013F 2014F

Turnover 847 1,548 1,984 2,129 Net Fixed Assets 176 168 312 294
Cost of Goods Sold (464) (671) (934) (987) Invts in Associates & JVs 2,165 1,882 1,882 1,882
Gross Profit 383 877 1,051 1,142 Other LT Assets 7,081 9,449 11,636 11,209
Other Opng (Exp)/Inc (53) (85) (56) (57) Cash & ST Invts 1,505 1,979 2,296 2,639
Operating Profit 331 792 995 1,085 Inventory 0 0 0 0
Exceptional Gain/(Loss) 0 270 78 0
Pre-tax Profit 538 1,158 1,035 1,032 ST Debt 664 2,136 1,844 1,744
Tax (97) (163) (178) (171) Other Current Liab 1,320 504 462 462
Minority Interest (122) (266) (271) (281) LT Debt 2,519 3,757 5,607 5,307
Preference Dividend (6) (6) (6) (6) Other LT Liabilities 365 365 365 365
Net Profit 314 722 579 574 Shareholders Equity 4,171 4,649 5,360 5,659
Net Profit before Except. 314 453 501 574 Minority Interests 2,488 2,488 2,488 2,488
EBITDA 736 1,298 1,664 1,789 Total Cap. & Liab. 11,528 13,899 16,127 16,025

Sales Gth (%) 548.9 82.7 28.1 7.3 Non-Cash Wkg. Capital (719) (85) (462) (462)
EBITDA Gth (%) 200.1 76.3 28.2 7.5 Net Cash/(Debt) (1,678) (3,913) (5,155) (4,412)
Opg Profit Gth (%) (4,454.8) 139.4 25.7 9.0
Net Profit Gth (%) 20.0 130.4 (19.8) (1.0)
Cash Flow Statement (HK$ m) Rates & Ratio

Pre-Tax Profit 538 1,158 1,035 1,032 Gross Margins (%) 45.3 56.6 53.0 53.6
Chg in Wkg.Cap. (22) (635) 310 0 ROA (%) 4.0 5.7 3.9 3.6
Net Operating CF 386 410 1,364 1,074 Div Payout Ratio (%) 78.1 34.6 47.5 52.4
Other Invts.(net) (1,567) (1,086) (832) 0 Asset Turnover (x) 0.1 0.1 0.1 0.1
Invts in Assoc. & JV 107 282 0 0 Debtors Turn (avg days) 50.2 28.4 2.8 N/A
Div from Assoc & JV 275 220 227 236 Creditors Turn (avg days) 506.2 408.4 15.0 N/A
Other Investing CF 0 0 0 0 Inventory Turn (avg days) N/A N/A N/A N/A
Net Investing CF (1,193) (586) (610) 232 Current Ratio (x) 1.1 0.9 1.0 1.2
Chg in Gross Debt 1,317 1,086 (292) (400) Net Debt/Equity (X) 0.3 0.5 0.7 0.5
Other Financing CF 0 0 0 0 Capex to Debt (%) 0.3 0.0 0.1 0.1
Net Financing CF 1,000 568 (437) (963) Z-Score (X) 0.7 0.8 0.9 1.0
Currency Adjustments 30 0 0 0 N. Cash/(Debt)PS (HK cts) (233.6) (544.7) (651.6) (557.7)
Chg in Cash 223 392 317 343 Opg CFPS (HK cts) 56.8 145.4 133.3 135.7
Free CFPS (HK cts) 52.5 56.7 171.9 135.2
Quarterly / Interim Income Statement (HK$ m) Segmental Breakdown / Key Assumptions
FY Dec 4Q2011 1Q2012 2Q2012 3Q2012 FY Dec 2011A 2012F 2013F 2014F

Turnover 425 370 394 419 Revenues (HK$ m)
Cost of Goods Sold (268) (153) (170) (206) Yongtaiwen E'way 687 1,428 1,457 1,501
Gross Profit 157 217 224 213 Ningbo-Beilun Port E'way 0 0 434 469
Other Oper. (Exp)/Inc (43) (13) (13) (28) Jiurui E'way 0 0 93 160
Operating Profit 115 205 210 185 Others* 161 120 0 0
Other Non Opg (Exp)/Inc 4 4 4 4 Total 847 1,548 1,984 2,129
Associates & JV Inc 58 55 52 61
Net Interest (Exp)/Inc (35) (36) (32) (30) EBIT (HK$ m)
Exceptional Gain/(Loss) N/A N/A N/A N/A Yongtaiwen E'way 380 760 775 802
Pre-tax Profit 142 228 235 220 Ningbo-Beilun Port E'way 0 0 178 198
Tax (37) (49) (52) (56) Jiurui E'way 0 0 53 94
Minority Interest (51) (67) (73) (64) Others* (49) 32 (11) (9)
Net Profit 54 112 110 100 Total 380 760 1,006 1,094
EBITDA 142 228 235 220 EBIT Margins (%)
Yongtaiwen E'way 55.3 53.2 53.2 53.5
Sales Gth (%) 9.0 (12.9) 6.4 6.3 Ningbo-Beilun Port E'way 41.0 42.2
EBITDA Gth (%) (48.3) 61.2 2.9 (6.2) Jiurui E'way 56.5 58.8
Opg Profit Gth (%) (49.8) 78.5 2.8 (12.2) Others* N/A 26.6 N/A N/A
Net Profit Gth (%) (64.3) 109.4 (1.8) (9.2) Total 44.8 49.1 50.7 51.4
Gross Margins (%) 37.0 58.7 56.8 50.8
Opg Profit Margins (%) 27.0 55.3 53.4 44.1 *Includes prop devpt

Page 16
www.dbsvickers.com

ed: JS / sa: JC

Bloomberg: SGL SP
|
Reuters: SOGL.SI

BUY S$0.615 STI : 3,224.80
Price Target: 12-Month S$ 0.90
Potential Catalyst: Faster than expected profit recognition
DBSV vs Consensus: Below consensus

Analyst
TAN Ai Teng +65 6398 7967

Price Relative
90
110
130
150
170
190
210
230
250
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
1.1
Relative Index
S$
Sound Global Limited (LHS) Relative STI INDEX (RHS)


FY Dec (RMB m) 2011A 2012F 2013F 2014F
Turnover 2,288 2,816 3,359 3,745
EBITDA 616 733 842 932
Net Profit 414 491 540 612
Net Pft (Pre Ex.) 414 491 540 612
EPS (S cts) 5.3 6.3 6.9 7.8
EPS Pre Ex. (S cts) 5.3 6.3 6.9 7.8
EPS Gth (%) 43 19 10 13
EPS Gth Pre Ex (%) 43 19 10 13
Diluted EPS (S cts) 5.3 6.3 6.9 7.8
Net DPS (S cts) 1.1 1.3 1.4 9.4
BV Per Share (S cts) 29.2 34.4 40.1 46.5
PE (X) 11.7 9.9 9.0 7.9
PE Pre Ex. (X) 11.7 9.9 9.0 7.9
P/Cash Flow (X) nm nm 10.5 8.7
EV/EBITDA (X) 5.8 6.2 5.4 4.7
Net Div Yield (%) 1.7 2.0 2.2 15.1
P/Book Value (X) 2.1 1.8 1.5 1.3
Net Debt/Equity (X) CASH CASH CASH CASH
ROAE (%) 19.6 19.7 18.5 18.0

Earnings Rev (%): - 4.1 23.1

ICB Industry : Utilities
ICB Sector: Gas; Water & Multiutilities
Principal Business: Epure is a turnkey water and wastewater
treatment solution provider in the PRC

At A Glance
Issued Capital (m shrs) 1,290
Mkt. Cap (S$m/US$m) 797 / 650
Major Shareholders
Yibo Wen (%) 45.4
International Finance Corp (%) 8.1
Norges Bank (%) 6.0
Free Float (%) 40.5
Avg. Daily Vol.(000) 1,048
Sound Global Limited
Growing awareness in
environment protection
Ample growth opportunities in China,
particularly from rural areas
Orderbook of >Rmb3bn offers good earnings
and growth visibility
Maintain BUY, TP of S$0.90

A pacesetter in Chinas water industry. SGL was
ranked by China Water, an authoritative website on
Chinas water sector, as the top engineering company in
2010 and one of the most influential local water groups
in the PRC in 2008-2011. It is the first listed water
company to secure a demonstration project for the
comprehensive development of sewage treatment in rural
China. We see huge potential from rural developments
for SGL as this market is largely underpenetrated and only
about 1% of sewage in the rural areas is treated. Hence,
there are ample opportunities from this market segment.

Orderbook at a record high of Rmb3bn. SGL has
announced Rmb2.5bn of new contracts in 2012, higher
than our initial projection of Rmb1.7bn. Including the
Rmb2bn BT contract won towards end of Dec, we
estimated that SGLs current backlog is in excess of
Rmb3bn. Going forward, SGL will continue to seek out
BOT and O&M projects. EPC jobs are likely to be
municipal and more expansion/upgrade in nature.
Overseas, management aims to make further progress
in markets such as Saudi Arabia, Indonesia, Philippines,
Sri Lanka and India.

Growth prospects still promising, Maintain Buy.
Post the last contract announcement, we raised
FY13/14F earnings to account for expected revenue
recognition. Our TP ofS$0.90 remains intact. Maintain
BUY.

Sound Global Limited

Page 17

Income Statement (RMB m) Balance Sheet (RMB m)

Turnover 2,288 2,816 3,359 3,745 Net Fixed Assets 48 49 50 51
Cost of Goods Sold (1,566) (1,960) (2,352) (2,624) Invts in Associates & JVs 0 0 0 0
Gross Profit 722 856 1,007 1,121 Other LT Assets 1,207 1,807 2,207 2,507
Other Opng (Exp)/Inc (133) (128) (169) (192) Cash & ST Invts 2,131 2,324 2,347 2,558
Other Non Opg (Exp)/Inc 0 0 0 0 Debtors 1,120 1,564 1,866 2,080
Tax (67) (75) (88) (100) Other Current Liab 1,752 1,762 1,992 2,158
Minority Interest 0 0 0 0 LT Debt 540 1,664 1,724 1,784

Sales Gth (%) 29.6 23.1 19.3 11.5 Non-Cash Wkg. Capital (182) 558 635 686
EBITDA Gth (%) 51.6 19.0 15.0 10.7 Net Cash/(Debt) 1,279 347 311 462
Opg Profit Gth (%) 54.9 23.6 15.1 10.8
Net Profit Gth (%) 43.1 18.8 9.8 13.4
Cash Flow Statement (RMB m) Rates & Ratio

Assoc. & JV Inc/(loss) 0 0 0 0 ROAE (%) 19.6 19.7 18.5 18.0
Chg in Wkg.Cap. (810) (760) (90) (64) ROA (%) 8.9 8.6 7.9 8.1
Net Operating CF (245) (248) 463 561 Div Payout Ratio (%) 20.0 20.0 20.0 120.0
Other Investing CF 262 (600) (400) (300) Inventory Turn (avg days) 4.0 4.5 4.5 4.7
Net Investing CF 257 (601) (401) (301) Current Ratio (x) 1.8 2.2 2.2 2.2
Chg in Gross Debt 198 1,124 60 60 Net Debt/Equity (X) CASH CASH CASH CASH
Capital Issues 0 0 0 0 Net Debt/Equity ex MI (X) CASH CASH CASH CASH
Other Financing CF (88) 0 0 0 Capex to Debt (%) 0.6 0.1 0.1 0.1
Net Financing CF 43 1,041 (38) (48) Z-Score (X) 2.5 2.3 2.3 2.3
Currency Adjustments (9) 0 0 0 N. Cash/(Debt)PS (RMB cts) 82.8 22.5 20.1 29.9
Chg in Cash 47 192 23 212 Opg CFPS (RMB cts) 36.6 33.1 35.8 40.5
Free CFPS (RMB cts) (16.2) (16.1) 29.9 36.3
Quarterly / Interim Income Statement (RMB m) Segmental Breakdown / Key Assumptions

Turnover 601 443 741 779 Revenues (RMB m)
Cost of Goods Sold (426) (308) (525) (530) Municipal Wastewater 2,170 2,579 2,992 3,146
Gross Profit 175 135 216 248 Industrial product 58 139 206 302
Other Oper. (Exp)/Inc (31) (17) (46) (28) O&M 60 98 161 297
Operating Profit 144 118 171 221
Associates & JV Inc 0 0 0 0 Total 2,288 2,816 3,359 3,745
Exceptional Gain/(Loss) 0 0 0 0 Key Assumptions
Pre-tax Profit 115 89 137 174 New order win 1,700.0 1,700.0 1,500.0 0.0
Tax (8) (12) (20) (22) Gross margin 30.4 30.4 30.0 29.9
Minority Interest 0 0 0 0
Net Profit 107 77 117 152
EBITDA 145 119 173 225

Sales Gth (%) (4.0) (26.3) 67.2 5.1
EBITDA Gth (%) (22.5) (17.7) 44.8 30.0
Opg Profit Gth (%) (21.7) (17.7) 44.3 29.3
Net Profit Gth (%) (18.7) (28.4) 52.8 29.7
Gross Margins (%) 29.1 30.4 29.2 31.9


Page 18
www.dbsvickers.com

ed: SGC / sa: JC

Bloomberg: EZI SP
|
Reuters: EZHL.SI

BUY S$1.705 STI : 3,224.80

Price Target : 12-Month S$ 2.12 (Prev S$1.82)
Potential Catalyst: Contract wins
DBSV vs Consensus: In line

Analyst
Jeremy THIA CFA +65 6398 7974
jeremythia@dbsvickers.com

Price Relative
55
105
155
205
255
305
355
405
455
505
0.1
0.3
0.5
0.7
0.9
1.1
1.3
1.5
1.7
1.9
Relative Index
S$
Ezion Holdings (LHS) Relative STI INDEX (RHS)

FY Dec (US$ m) 2011A 2012F 2013F 2014F
Revenue 107 152 373 442
EBITDA 61 90 212 219
Net Profit 58 80 129 178
Net Pft (Pre-Ex, aft pref div)* 48 67 121 170
EPS (S cts) 10.0 10.8 17.0 23.5
EPS (Pre Ex, aft pref div)*.
(S cts)
8.2 9.0 16.0 22.5
EPS Gth (%) 45 8 58 38
EPS Gth (Pre Ex, aft pref div)*
(%)
48 11 77 40
Net DPS (S cts) 0.1 0.1 0.1 0.1
BV Per Share (S cts) 39.2 55.4 69.8 92.2
PE (X) 17.2 15.9 10.1 7.3
PE (Pre Ex, aft pref div)* (X) 21.0 19.0 10.7 7.6
P/Cash Flow (X) 28.9 20.9 10.0 9.2
EV/EBITDA (X) 18.6 20.8 9.6 9.1
Net Div Yield (%) 0.1 0.1 0.1 0.1
P/Book Value (X) 4.4 3.1 2.5 1.9
ROAE (%) 29.2 25.0 25.9 27.7


ICB Industry : Oil & Gas
ICB Sector: Oil Equipment; Services & Dist
Principal Business: Ezion Holdings specialises in marine logistics and
support services to the offshore oil and gas industries.

At A Glance
Mkt. Cap (S$m/US$m) 1,535 / 1,252
Major Shareholders
Thiam Keng Chew (%) 17.6
Franklin Resources (%) 7.7
Havenport Asset Mgmt (%) 6.3
Free Float (%) 68.4
Ezion Holdings
Rally has legs

Strategic shareholders will enable Ezion to capture
still-robust demand
Strong FY12 order wins to support solid sequential
earnings growth and FY11-14 EPS CAGR of 41%
Maintain BUY, TP lifted to S$2.12

Still has legs. The recent introduction of strategic
shareholders, Mr Tan Boy Tee and EDB Investments, has not
only provided Ezion with additional funds, but also allows it to
leverage on these shareholders vast experience and business
networks. Indeed, Ezion could also tap on Mr. Tan to co-fund
future projects via 50/50 JV structures to enable it to continue
to capture robust market demand for its liftboats and service
rigs without stressing its balance sheet with more debt.

Strong FY12 order wins support FY11-14 EPS CAGR of
41%. Ezion has secured US$1.4bn worth of contract in FY12,
vs. US$495m in FY11. As these projects kick in progressively,
they will support our projection of steady sequential earnings
growth over the next eight quarters leading to a strong FY11-
14F EPS CAGR of 41%. There is upside to our numbers from
more potential contract wins.

Maintain BUY, TP raised to S$2.12. We are impressed with
Ezions rapid and successful expansion into new geographical
markets (Gulf of Mexico, North Sea, Southeast Asia), its
growing traction with major oil companies (Pemex, Maersk
Oil, Pertamina, Petronas), and scaling up the value chain (time
charters from bareboat). We continue to like Ezion for its
strong execution and earnings delivery, and solid earnings
growth. We see catalysts from more potential contract wins
ahead, and raise our TP to S$2.12, as we roll forward to 11x
blended FY13/14 PE, supported by its high earnings visibility.


Ezion Holdings

Page 19

Income Statement (US$ m) Balance Sheet (US$ m)

Turnover 107 152 373 442 Net Fixed Assets 271 890 1,075 1,182
Net Interest (Exp)/Inc (1) (5) (27) (29) Total Assets 470 1,214 1,513 1,685
Minority Interest 0 0 0 0 LT Debt 118 576 720 715
Net Profit 58 80 129 178 Other LT Liabilities 2 2 2 2
Net Profit before Except. 48 67 129 178 Shareholders Equity 229 508 629 798
Preference Dividend 0 0 (8) (8) Minority Interests 40 40 40 40
Net Pft Pre-Ex, aft pref div 48 67 121 170 Total Cap. & Liab. 470 1,214 1,513 1,685
EBITDA 61 90 212 219
Non-Cash Wkg. Capital 22 27 55 68
Sales Gth (%) (8.7) 41.8 145.8 18.5 Net Cash/(Debt) (95) (478) (591) (565)
EBITDA Gth (%) 30.9 48.6 134.2 3.4
Opg Profit Gth (%) 36.3 46.6 131.0 38.9
Net Profit Gth (%) 44.6 37.2 61.9 37.9
Cash Flow Statement (US$ m) Rates & Ratio

Chg in Wkg.Cap. (20) (6) (30) (18) ROA (%) 13.4 9.5 8.9 10.6
Other Operating CF (6) (13) 0 0 ROCE (%) 10.3 7.2 10.3 12.1
Net Operating CF 35 61 129 141 Div Payout Ratio (%) 0.9 0.9 0.6 0.4
Invts in Assoc. & JV (15) (23) 0 0 Debtors Turn (avg days) 117.0 90.9 73.4 96.2
Other Investing CF 3 0 0 0 Inventory Turn (avg days) 3.2 N/A N/A N/A
Chg in Gross Debt 29 458 143 (5) Net Debt/Equity (X) 0.4 0.9 0.9 0.7
Other Financing CF (5) 100 (8) (8) Capex to Debt (%) 36.6 100.8 30.9 14.1
Net Financing CF 23 658 135 (13) Z-Score (X) 2.1 1.7 1.8 2.1
Currency Adjustments 0 0 0 0 N. Cash/(Debt)PS (US cts.) (13.2) (52.8) (63.6) (60.8)
Chg in Cash (12) 75 29 22 Opg CFPS (US cts.) 7.6 7.3 17.1 17.2
Free CFPS (US cts.) (3.3) (61.9) (11.3) 3.8
Quarterly / Interim Income Statement (US$ m) Segmental Breakdown / Key Assumptions

Turnover 27 31 37 39 Revenues (US$ m)
Cost of Goods Sold (14) (17) (20) (20) Offshore Logistics Support 65 71 138 131
Gross Profit 13 14 17 19 Liftboats & jackup rigs 42 81 234 311
Other Oper. (Exp)/Inc (3) (2) (3) (4) Others 0 0 0 0
Operating Profit 10 12 14 15 Total 107 152 373 442
Associates & JV Inc 2 4 3 4
Net Interest (Exp)/Inc 0 0 0 (1) Operating profit (US$ m)
Exceptional Gain/(Loss) 0 0 13 0 Offshore Logistics Support 24 23 37 38
Pre-tax Profit 11 15 29 18 Liftboats & jackup rigs 26 38 103 157
Tax (1) (1) (1) (1) Others (8) 0 0 0
Minority Interest 0 0 0 0 Total 42 61 141 196
Preference Dividend 0 0 0 0 Operating profit Margins
Net Pft Pre-Ex, aft pref div 11 14 15 16 Offshore Logistics Support 37.1 31.9 27.1 29.4
EBITDA 15 18 19 23 Liftboats & jackup rigs 61.4 47.5 44.1 50.6
Others NM NM NM NM
Sales Gth (%) (14.5) 12.1 21.5 4.0 Total 38.9 40.2 37.8 44.3
EBITDA Gth (%) (10.8) 26.0 2.6 20.2
Opg Profit Gth (%) (18.0) 20.2 18.2 7.6
Net Profit Gth (%) (19.0) 34.2 99.8 (42.8) Key Assumptions
Gross Margins (%) 48.1 44.4 45.9 48.2 Est avg day rate: Offshore 7,777.0 9,780.7 20,183.2 20,183.2
Opg Profit Margins (%) 35.5 38.1 37.0 38.3 Est utilisation: Offshore 79.8 78.7 78.7 78.7
Net Profit Margins (%) 38.5 46.1 75.7 41.7 Est avg day rate: Liftboats 45,516.2 47,755.7 48,551.8 49,427.7
Est utilisation: Liftboats (%) 95.0 97.2 98.1 98.1


Page 20
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: JAYA SP
|
Reuters: JAYA.SI

BUY S$0.665 STI : 3,224.80

Price Target : 12-month S$ 0.85
Potential Catalyst: Earnings recovery; new orders; resumption of
dividend payout
DBSV vs Consensus: NA

Analyst

Price Relative
63
83
103
123
143
163
183
203
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Relative Index
S$
Jaya Holdings (LHS) Relative STI INDEX (RHS)


FY Jun (US$ m) 2011A 2012A 2013F 2014F
Turnover 99 82 198 144
EBITDA 90 48 72 85
Net Pft (Pre Ex.) 49 19 35 45
EPS (S cts) 10.3 7.0 5.7 7.2
EPS Pre Ex. (S cts) 7.8 3.0 5.6 7.2
EPS Gth (%) (12) (33) (18) 25
EPS Gth Pre Ex (%) (44) (61) 86 27
Diluted EPS (S cts) 10.3 7.0 5.7 7.2
Net DPS (S cts) 0.0 0.0 0.0 0.0
BV Per Share (S cts) 72.0 79.2 84.9 92.0
PE (X) 6.5 9.6 11.7 9.3
PE Pre Ex. (X) 8.6 22.2 11.9 9.3
P/Cash Flow (X) 9.0 2.8 5.2 4.3
EV/EBITDA (X) 5.5 9.6 7.5 6.3
Net Div Yield (%) 0.0 0.0 0.0 0.0
P/Book Value (X) 0.9 0.8 0.8 0.7
ROAE (%) 16.4 9.2 7.0 8.1


Principal Business: Owning & chartering of offshore support vessels
operating in the offshore oil and gas, marine construction, mining &
harbour tug operations.

At A Glance
Mkt. Cap (S$m/US$m) 514 / 420
Major Shareholders
Nautical Offshore (%) 54.8
Fidelity Mgmt & Research (%) 9.5
Cheyne Capital (%) 5.0
Free Float (%) 30.7

Jaya Holdings
A new chapter of growth

Clearer direction with repositioned businesses
Strategic alliance with IHC a potential game changer
Earnings have troughed; projecting FY12-14 EPS
CAGR of 54%
A recovery play with potential dividend kicker; re-
instate coverage with BUY, +45% to TP of S$0.85

Repositioned businesses provide clearer direction. Jaya has
repositioned itself as a services provider to the offshore energy
sector. Its core focus on chartering ensures a higher level of
recurring income, while a move away from speculative
shipbuilding would reduce earnings volatility.
Strategic alliance with IHC Merwede - a potential game
changer. This could see both parties collaborating to build
IHCs high specification offshore vessels at Jayas yards. Securing
such orders would propel Jaya up the value chain and enable it
to leapfrog its regional competitors. Indeed, recent media
reports indicate that IHC-Jaya is in talks with several parties for
potentially seven to 10 orders worth EUR70-150m each.
Projecting robust earnings recovery from FY12s trough.
We believe Jayas earnings troughed in FY12 as the group
transitioned to its new business model. Despite fewer expected
vessel sales/disposals, we project FY12-14F EPS CAGR of 54%,
driven primarily by the Offshore Support division on a larger
fleet, improved day rates, and better margins. There is upside
potential to our numbers as we have not assumed new vessel
orders.
BUY, TP S$0.85; a recovery play with potential dividend
kicker. With a clearer focus and less volatile earnings, we
believe Jaya now offers a more attractive investment
opportunity. We see a potential re-rating of the stock towards
its book value on a strong 86% recovery in FY13 earnings.
The potential award of high-value newbuild orders and
resumption of dividend payments following the refinancing of
its scheme debt are likely catalysts. We re-instate coverage on
Jaya with BUY and TP of S$0.85, pegged to 1.0x FY13 P/BV.


Jaya Holdings

Page 21

FY Jun 2011A 2012A 2013F 2014F FY Jun 2011A 2012A 2013F 2014F

Other Opng (Exp)/Inc 30 0 (5) (5) Cash & ST Invts 187 200 32 34
Other Non Opg (Exp)/Inc 9 (1) 0 0 Debtors 33 17 40 26
Associates & JV Inc 1 (1) 0 0 Other Current Assets 30 20 20 20
Net Interest (Exp)/Inc (3) (2) (6) (6) Total Assets 791 825 804 847
EBITDA 90 48 72 85 Total Cap. & Liab. 791 825 804 847

Sales Gth (%) (61.0) (16.9) 141.0 (27.4) Non-Cash Wkg. Capital 204 124 106 81
EBITDA Gth (%) (24.4) (46.0) 47.5 19.4 Net Cash/(Debt) (71) (46) (119) (117)
Opg Profit Gth (%) (41.6) (56.9) 69.1 24.2
Net Profit Gth (%) (11.8) (32.6) (17.7) 24.9

Assoc. & JV Inc/(loss) (1) 1 0 0 ROAE (%) 16.4 9.2 7.0 8.1
Chg in Wkg.Cap. 17 116 28 24 ROA (%) 8.6 5.4 4.4 5.5
Other Operating CF (61) (31) (2) (3) ROCE (%) 7.2 3.3 5.7 7.1
Other Investing CF 2 9 0 0 Inventory Turn (avg days) 1,541.4 2,184.8 500.2 1,073.7
Div Paid 0 0 0 0 Quick Ratio (x) 2.4 1.7 0.5 0.4
Chg in Gross Debt 0 (12) (96) 0 Net Debt/Equity (X) 0.2 0.1 0.2 0.2
Net Financing CF (6) (19) (96) 0 Z-Score (X) 1.7 1.6 1.8 1.8
Chg in Cash 37 14 (169) 2 Opg CFPS (US cts.) 3.9 4.8 6.7 9.6
Free CFPS (US cts.) 5.4 3.0 (9.4) 0.3
FY Jun 2Q2012 3Q2012 4Q2012 1Q2013 FY Jun 2011A 2012A 2013F 2014F

Cost of Goods Sold (12) (9) (15) (27) Offshore Support Services 52 70 102 129
Gross Profit 2 7 8 12 Offshore Engineering Services 47 13 96 15
Other Oper. (Exp)/Inc (2) (2) 5 (1) Others 0 0 0 0
Net Interest (Exp)/Inc (1) 0 0 (1)
Exceptional Gain/(Loss) 3 1 22 1 Key Assumptions
Pre-tax Profit 2 6 35 10 Size of charter fleet 23.0 28.0 31.0 35.0
Tax (1) (2) 0 0 Avg day rate (US$) 10,214 9,704.9 12,046.0 12,250.0
Minority Interest 0 0 0 0 Ann. utilisation rate (%) 61.0 70.0 82.3 88.0
Net Profit 1 4 34 10 No. of vessels disposed/year 5.0 4.0 1.0 1.0
Net profit bef Except. (2) 3 13 9 No. of vessels sold per year 3.0 1.0 3.0 1.0
EBITDA 6 12 19 16

Sales Gth (%) (50.2) 14.3 43.6 66.0
EBITDA Gth (%) (48.6) 93.9 68.8 (15.5)
Opg Profit Gth (%) (95.1) 1,442.0 157.6 (20.7)
Net Profit Gth (%) (79.1) 276.6 812.4 (70.5)
Gross Margins (%) 14.1 42.3 34.8 31.1


Page 22
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: BAL SP
|
Reuters: BUMI.SI

BUY S$1.08 STI : 3,224.80
Potential Catalyst: CPO price recovery, better-than-expected results,
more land bank acquisitions
DBSV vs Consensus: Lower FY13F and FY14F earnings due to lower
CPO price projections

Analyst
Ben SANTOSO +65 6398 7976
bensantoso@dbsvickers.com

Price Relative
89
109
129
149
169
189
209
0.7
0.8
0.9
1.0
1.1
1.2
1.3
Apr-12 Jul-12 Oct-12
Relative Index
S$
Bumitama Agri (LHS) Relative STI INDEX (RHS)


FY Dec (Rpbn) 2011A 2012F 2013F 2014F
Turnover 2,805 3,740 4,501 4,732
EBITDA 1,380 1,573 1,970 2,194
Pre-tax Profit 1,190 1,309 1,693 1,906
Net Profit 762 824 1,068 1,201
Net Pft (Pre Ex.) 762 824 1,068 1,201
Net Pft (ex. BA gains) 632 824 1,068 1,201
EPS (S cts) 5.5 6.0 7.7 8.7
EPS Pre Ex. (S cts) 5.5 6.0 7.7 8.7
EPS Gth (%) (15) 8 29 12
EPS Gth Pre Ex (%) (15) 8 29 12
Net DPS (S cts) 0.0 0.0 0.0 0.0
BV Per Share (S cts) 19.4 27.5 35.2 43.9
PE (X) 19.7 18.2 14.1 12.5
PE Pre Ex. (X) 19.7 18.2 14.1 12.5
P/Cash Flow (X) 15.4 13.8 10.0 9.2
EV/EBITDA (X) 12.5 11.1 8.8 7.8
Net Div Yield (%) 0.0 0.0 0.0 0.0
P/Book Value (X) 5.6 3.9 3.1 2.5
ROAE (%) 32.5 25.4 24.6 21.9


ICB Industry : Consumer Goods
ICB Sector: Food Producers
Principal Business: A fast-growing Indonesian oil palm planter with
estates in Riau, Central & West Kalimantan. The group sells Crude
Palm Oil (CPO) and Palm Kernel (PK).

At A Glance
Mkt. Cap (S$bn/US$m) 1,906 / 1,554
Major Shareholders
Fortune Holdings (%) 52.6
Oakridge Investments (%) 30.4
Free Float (%) 16.9
Bumitama Agri
Our upstream pick

An Indonesian oil palm planter in a strong growth
phase, with FY12F-15F earnings CAGR of 24%

Plantable reserves of c.63k ha to support
expansion to FY15F, while net gearing to decline
to 19% by FY14F

PEG ratio of 0.57x undervalues Bumitama relative
to its growth outlook

BUY for 16% upside to S$1.25 TP

An earnings growth story. Bumitama has been
aggressively planting/acquiring estates since 2004. The group
is expected to increase its own planted area to slightly over
100k ha by end 2012 around 50% of which is immature.
Bumitama is poised to deliver 24% FFB output and 17%
earnings CAGR between FY12F and FY15F despite
declining CPO price expectations. The groups share of
outside FFB processed is also due to decline from 33% in
FY12F to 10% in FY15F. This should help to improve its
EBITDA margins to 47% in FY15F from 42% in FY12F.

Strong financial position. Given its strong own FFB volume
growth, Bumitama will have a strong earnings outlook and
cash flow over the next three years. Its financial position is
likewise expected to strengthen with net gearing declining to
19% by FY14F from 55% in FY12F. This will allow the group
to utilise its plantable reserves of 63k ha to further boost its
earnings in the medium-term and provide financial flexibility
to potentially add to its land bank.

Undemanding value for growth. We peg Bumitamas TP
at S$1.25/share, based on DCF valuation (WACC: 13.5%, Rf:
6.0%, Rm: 14.2%, beta: 1.1, TG: 3%). This implies FY13F PE
of 14.1x. Compared to its three-year earnings CAGR of 24%,
Bumitamas FY13F PEG ratio is estimated to be only 0.57x,
which we believe is undemanding relative to peers. Our BUY
rating on the counter is premised on 16% upside to a TP of
S$1.25.


Bumitama Agri

Page 23

Income Statement (Rpbn) Balance Sheet (Rpbn)

Turnover 2,805 3,740 4,501 4,732 Net Fixed Assets 1,170 1,454 1,761 1,983
Gross Profit 1,240 1,701 2,106 2,317 Other LT Assets 4,674 5,592 6,254 6,923
Operating Profit 1,046 1,457 1,816 2,008 Inventory 263 226 266 268
Other Non Opg (Exp)/Inc 238 (7) 2 (2) Debtors 52 92 110 116
Pre-tax Profit 1,190 1,309 1,693 1,906 ST Debt 1,626 550 605 582
Minority Interest (131) (163) (211) (237) LT Debt 692 2,414 1,747 1,142
Net Profit 762 824 1,068 1,201 Shareholders Equity 2,681 3,804 4,872 6,073
Net Profit before Except. 762 824 1,068 1,201 Minority Interests 244 407 618 855
Net Pft (ex. BA gains) 632 824 1,068 1,201 Total Cap. & Liab. 6,507 8,404 9,197 10,022
EBITDA 1,380 1,573 1,970 2,194
Sales Gth (%) 43.1 33.3 20.4 5.1 Non-Cash Wkg. Capital (378) (330) (373) (354)
EBITDA Gth (%) (9.5) 14.0 25.2 11.4 Net Cash/(Debt) (2,047) (2,100) (1,722) (1,169)
Opg Profit Gth (%) 85.1 39.3 24.6 10.6
Net Profit Gth (%) (14.6) 8.2 29.5 12.5
Cash Flow Statement (Rpbn) Rates & Ratio

Pre-Tax Profit 1,190 1,309 1,693 1,906 Gross Margins (%) 44.2 45.5 46.8 49.0
Chg in Wkg.Cap. 173 (48) 43 (19) ROA (%) 12.6 11.1 12.1 12.5
Other Operating CF (186) 23 24 26 ROCE (%) 14.5 16.4 17.1 17.2
Net Operating CF 972 1,085 1,498 1,632 Div Payout Ratio (%) 0.0 0.0 0.0 0.0
Capital Exp.(net) (858) (1,046) (1,120) (1,079) Net Interest Cover (x) 11.1 10.3 14.5 20.1
Other Invts.(net) 0 (233) 0 0 Asset Turnover (x) 0.5 0.5 0.5 0.5
Invts in Assoc. & JV 0 (1) 0 0 Debtors Turn (avg days) 5.1 7.0 8.2 8.7
Other Investing CF 10 (46) 0 0 Inventory Turn (avg days) 52.0 46.6 40.0 43.7
Net Investing CF (848) (1,325) (1,120) (1,079) Current Ratio (x) 0.3 1.0 0.8 0.7
Chg in Gross Debt (42) 633 (611) (628) Net Debt/Equity (X) 0.7 0.5 0.3 0.2
Capital Issues (88) 200 0 0 Net Debt/Equity ex MI (X) 0.8 0.6 0.4 0.2
Other Financing CF (87,092) 778 817 858 Capex to Debt (%) 37.0 35.3 47.6 62.6
Net Financing CF (217,076) 833,296 (610,671) (627,280) Z-Score (X) NA 3.7 4.1 4.7
Currency Adjustments (393) 0 0 0 N. Cash/(Debt)PS (Rp) (1,165) (1,195) (980) (665)
Chg in Cash (92,937) 592,761 (233,533) (74,170) Opg CFPS (Rp) 455 644 828 940
Free CFPS (Rp) 65 22 215 315
Quarterly / Interim Income Statement (Rpbn) Segmental Breakdown / Key Assumptions
FY Dec 1Q2012 2Q2012 3Q2012

FY Dec 2011A 2012F 2013F 2014F

Turnover 854 829 846 Revenues (Rp m)
Cost of Goods Sold (461) (508) (487) CPO 2,526 3,409 4,109 4,317
Gross Profit 394 321 360 PK 279 331 393 415
Other Oper. (Exp)/Inc (76) (45) (60)
Operating Profit 317 275 299
Other Non Opg (Exp)/Inc (19) 31 (12)
Associates & JV Inc 0 0 0 Total 2,805 3,740 4,501 4,732
Net Interest (Exp)/Inc (27) (24) (15) Key Assumptions
Exceptional Gain/(Loss) 0 0 0 CPO price (RM/MT) 3,274 3,020 2,940 2,920
Pre-tax Profit 272 282 272 Own mature oil palm 41,084 51,532 64,769 78,372
Tax (68) (61) (70) CPO sales volume (MT) 335,409 451,645 547,618 586,315
Minority Interest (15) (30) (24) Palm kernel sales vol. (MT) 62,418 85,326 103,457 110,768
Net Profit 189 192 178 Avg. USD/IDR rate 8,757 9,370 9,250 8,975
Net profit bef Except. 189 192 178
EBITDA 318 327 304

Sales Gth (%) N/A (3.0) 2.1
EBITDA Gth (%) N/A 2.7 (6.8)
Opg Profit Gth (%) N/A (13.3) 8.7
Net Profit Gth (%) N/A 1.3 (7.1)
Gross Margins (%) 46.1 38.7 42.5
Opg Profit Margins (%) 37.1 33.2 35.4
Net Profit Margins (%) 22.1 23.1 21.0



Page 24
www.dbsvickers.com

ed: JS / sa: JC

Bloomberg: CDREIT SP
|
Reuters: CDLT.SI

BUY S$1.93 STI : 3,224.80
(Upgrade from HOLD)
Price Target : 12-Month S$ 2.11 (Prev S$ 2.01)
Potential Catalyst: Acquisitions / stronger than expected results
DBSV vs Consensus: Slighter higher as we factor in acquistion

Analyst
Derek TAN +65 6398 7966
derektan@dbsvickers.com

LOCK Mun Yee +65 6398 7972
munyee@dbsvickers.com
Price Relative
59
79
99
119
139
159
179
199
219
0.4
0.9
1.4
1.9
2.4
Relative Index
S$
CDL Hospitality Trusts (LHS) Relative STI INDEX (RHS)


FY Dec (S$ m) 2011A 2012F 2013F 2014F
Gross Revenue 141 150 163 170
Net Property Inc 135 140 152 159
Total Return 176 111 118 123
Distribution Inc 118 120 128 134
EPU (S cts) 10.7 11.5 12.2 12.6
EPU Gth (%) 14 7 6 4
DPU (S cts) 11.1 11.5 12.2 12.6
DPU Gth (%) 8 4 6 4
NAV per shr (S cts) 160.9 160.0 159.1 158.1
PE (X) 18.0 16.8 15.9 15.3
Distribution Yield (%) 5.7 5.9 6.3 6.5
P/NAV (x) 1.2 1.2 1.2 1.2
Aggregate Leverage (%) 26.3 26.2 29.3 29.2
ROAE (%) 6.9 7.1 7.6 8.0

Distn. Inc Chng (%): (0.4) 2.4 2.8
Consensus DPU (S cts): 11.4 11.9 12.2

ICB Industry : Financials
ICB Sector: Real Estate Investment Trust
Principal Business: CDL REIT is a stapled security consisting of
hospitality trust with portfolio of hotel assets in Singapore and a
business trust

At A Glance
Mkt. Cap (S$m/US$m) 1,884 / 1,535
Major Shareholders
Hospitality Holdings Pte Ltd (%) 32.4
Aberdeen Asset Management (%) 6.7
Cohen & Steers Inc (%) 5.0
Free Float (%) 51.0
Industry Focus
CDL Hospitality Trusts
Hitting the right notes

Opportunistic venture into Maldives
Merits of the deal outweighs potential risks
Upgrade to BUY, TP raised to S$2.11

Opportunistic venture into Maldives. CDL Hospitality
Trust (CDREIT) announced that it is entering into a sale-and-
leaseback of Angsana Velavaru Maldives from Banyan Tree
Holdings. While this is different from its current portfolio of
largely city-hotels, we believe that the merits of this deal
overweigh potential risks.

Merits of the deal with more upside in the medium
term. Firstly, it gives CDREIT exposure into the robust growth
of the Maldives hospitality market, supported by growing
popularity from Chinese tourists, which now account for close
to 25% of total visitors to Maldives. Secondly, we see the
synergistic collaboration with Banyan Tree Holdings as positive
for both parties : (i) the 10-year lease with vendor, one of the
leading resort global operators, offers operational visibility for
the property; (ii) rental payments pegged to gross operating
profits and incentives motivates the operator to achieve the
highest possible returns for the property; and (iii) downside
protection with a minimum rent and reserve of US$6.0m,
implying a return of at least 7.0% (vs its reported proforma
FY12F initial yield of 9.6%), which we believe is attractive.
Lastly, there is potential to develop more water villas (not
factored in yet) at the site with new guidelines from the
authorities.

Upgrade to BUY, TP raised to TP S$2.11 based on DDM.
Incorporating this new acquisition, our numbers are raised by
3.2-3.7% and gearing is likely to remain at a more efficient
29% and thus our TP is raised to S$2.11. While share price of
CDREIT has underperformed the S-REIT sector of late given
worries of slowing RevPAR growth from Singapore, we see
the acquisition of Angsana Velavaru as a means of putting the
trust back onto a growth path. Upgrade to BUY.

Industry Focus
CDL Hospitality Trusts

Page 25

Statement of Total Return (S$ m) Balance Sheet (S$ m)

Gross revenue 141 150 163 170 Investment Properties 2,030 2,040 2,128 2,131
Property expenses (6) (10) (11) (11) Other LT Assets 0 0 0 0
Net Property Income 135 140 152 159 Cash & ST Invts 70 74 77 76
Other Operating expenses (14) (14) (15) (15) Inventory 0 0 0 0
Net Interest (Exp)/Inc (13) (14) (18) (19) Other Current Assets 0 0 0 0
Exceptional Gain/(Loss) 0 0 0 0 Total Assets 2,118 2,131 2,224 2,228
Net Income 108 112 120 125
Tax (5) (2) (2) (2) ST Debt 0 0 0 0
Minority Interest 0 0 0 0 Other Current Liabilities 24 37 42 45
Preference Dividend 0 0 0 0 LT Debt 535 535 623 623
Net Income After Tax 103 111 118 123 Other LT Liabilities 12 12 12 12
Total Return 176 111 118 123 Unit holders funds 1,547 1,547 1,547 1,547
Non-tax deductible Items 15 10 10 11 Minority Interests 0 0 0 0
Net Inc available for Dist. 118 120 128 134 Total Funds & Liabilities 2,118 2,131 2,224 2,228

Revenue Gth (%) 15.4 6.3 8.7 4.5 Non-Cash Wkg. Capital (6) (19) (22) (25)
N Property Inc Gth (%) 17.5 3.7 8.7 4.5 Net Cash/(Debt) (465) (461) (546) (546)
Net Inc Gth (%) 22.0 7.3 6.6 4.5
Dist. Payout Ratio (%) 90.0 92.0 92.0 92.0


Pre-Tax Income 108 112 120 125 Net Prop Inc Margins (%) 95.8 93.5 93.5 93.5
Dep. & Amort. 0 0 0 0 Net Income Margins (%) 73.1 73.7 72.3 72.3
Tax Paid 0 0 0 0 Dist to revenue (%) 83.7 80.2 78.6 78.6
Associates &JV Inc/(Loss) 0 0 0 0 Managers & Trustees fees 10.2 9.4 9.2 9.1
Chg in Wkg.Cap. 0 12 1 1 to sales (%)
Other Operating CF 23 0 0 0 ROAE (%) 6.9 7.1 7.6 8.0
Net Operating CF 131 124 121 126 ROA (%) 5.2 5.2 5.4 5.5
Net Invt in Properties (166) (10) (88) (3) ROCE (%) 5.9 5.9 6.3 6.5
Other Invts (net) 0 0 0 0 Int. Cover (x) 9.2 9.2 7.8 7.7
Invts in Assoc. & JV 0 0 0 0 Current Ratio (x) 3.7 2.5 2.3 2.1
Div from Assoc. & JVs 0 0 0 0 Quick ratio (x) 3.7 2.5 2.3 2.1
Other Investing CF 0 0 0 0 Aggregate Leverage (%) 26.3 26.2 29.3 29.2
Net Investing CF (166) (10) (88) (3) Z-Score (X) 2.4 2.5 2.5 2.5
Distribution Paid (102) (111) (118) (123) Operating CFPS (S cts) 13.7 11.7 12.3 12.8
Chg in Gross Debt 153 0 88 0 Free CFPS (S cts) (3.7) 11.8 3.4 12.6
New units issued 0 0 0 0
Other Financing CF (13) 0 0 0
Net Financing CF 38 (111) (30) (123)
Currency Adjustments 0 0 0 0
Chg in Cash 3 4 3 0

Quarterly / Interim Income Statement (S$ m) P/Book Value (x)
FY Dec 4Q2011 1Q2012 2Q2012 3Q2012
0.2
0.4
0.6
0.8
1.0
1.2
1.4
2009 2010 2011 2012

Gross revenue 38 38 37 36
Property expenses (2) (2) (3) (3)
Net Property Income 36 36 34 34
Other Operating expenses (5) (4) (4) (3)
Net Income 28 29 26 26
Tax (4) 0 0 0
Minority Interest 0 0 (2) 0
Net Income after Tax 24 29 24 26
Total Return 0 0 0 0
Non-tax deductible Items (69) 1 7 3
Net Inc available for Dist. 28 30 31 29

Revenue Gth (%) 4 2 (5) (1)
N Property Inc Gth (%) 4 1 (5) (1)
Net Inc Gth (%) (10) 18 (15) 9
Net Prop Inc Margin (%) 93.9 93.8 93.1 93.0


Page 26
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: FEHT SP
|
Reuters: FAEH.SI

BUY S$0.985 STI : 3,224.80

Potential Catalyst: Acquisitions
DBSV vs Consensus: In line

Analyst
Derek TAN CPA +65 6398 7966
derektan@dbsvickers.com

Price Relative
89
109
129
149
169
189
209
0.8
0.9
0.9
1.0
1.0
1.1
1.1
1.2
1.2
Aug-12 Nov-12
Relative Index
S$
Far East Hospitality Trust (LHS) Relative STI INDEX (RHS)


FY Dec (S$ m) 2011A 2012F 2013F 2014F
Total Return 66 80 86 89
EPU (S cts) 4.1 5.0 5.3 5.5
EPU Gth (%) N/A 20 7 3
DPU (S cts) 4.7 5.5 5.9 6.0
DPU Gth (%) N/A 17 7 3
NAV per shr (S cts) 93.1 93.1 92.7 91.9
PE (X) 23.8 19.8 18.4 17.8
P/NAV (x) 1.1 1.1 1.1 1.1
ROAE (%) 8.9 5.3 5.7 6.0

Distn. Inc Chng (%): - - -

ICB Sector: Real Estate Investment Trusts
Principal Business: Far East Hospitality Trust is a REIT with a primary
focus in investing in hospitality and hospitality related assets located
in Singapore.

At A Glance
Mkt. Cap (S$m/US$m) 1,580 / 1,289
Major Shareholders
Golden Development (%) 13.9
Golden Landmark (%) 12.0
Far East Organization (%) 11.4
Free Float (%) 62.7

Far East Hospitality Trust
The one to be reckoned with

Pure play into Singapore Hospitality sector with
an industry leading position
Reputable sponsor with a visible pipeline
Near-term acquisitions catalyst, BUY, TP S$1.09

An industry leader with attractive earnings growth
potential. Far East Hospitality Trust (Far East H-Trust)
offers investors exciting exposure to Singapores growing
hospitality sector. A sizeable initial portfolio of 11 hotels
and serviced residences, with 2,531 room/ unit keys
valued at close to S$2.1bn, will make the trust one of
the largest single owner of hotels and serviced
residences in Singapore. In terms of organic growth
prospects, it is one of the strongest amongst peers
coming from (i) operational ramp-up of the newly-
completed Oasia Hotel; (ii) phased completions of
various refurbishment programs instituted by the
sponsor and the manager over the next two years.

Reputable sponsor backing with a visible pipeline.
The sponsor is part of Far East Organization (FEO), a
household name in the property development and
hospitality sector in Singapore. Apart from being able to
tap the sponsors valuable experience in the hospitality
business, the sponsor has also given a ROFR to Far East
H-Trust to acquire up to an initial pipeline of seven
hotels/serviced residences which could potentially grow
keys under its ownership by close to 49.1%.

Acquisition catalyst in the near term, BUY, TP
S$1.09. FEHT signed an MOU regarding the proposed
acquisition of Rendezvous Grand Singapore Hotel, a
prime downtown hotel. While no financials are shared at
this point, we expect this acquisition to be accretive to
the trust when completed and should result in further
upside surprise to our numbers.


Far East Hospitality Trust

Page 27


Gross revenue 104 118 126 132 Investment Properties 2,140 2,146 2,158 2,162
Property expenses (10) (10) (11) (11) Other LT Assets 0 0 0 0
Exceptional Gain/(Loss) 0 0 0 0 Total Assets 2,145 2,157 2,170 2,176
Net Income 66 80 86 89
Tax 0 0 0 0 ST Debt 0 0 0 0
Net Income After Tax 66 80 86 89 Other LT Liabilities 0 0 0 0
Total Return 66 80 86 89 Unit holders funds 1,493 1,493 1,493 1,498
Non-tax deductible Items 9 9 9 9 Minority Interests 0 0 0 0
Net Inc available for Dist. 76 88 95 99 Total Funds & Liabilities 2,145 2,157 2,170 2,176

Revenue Gth (%) N/A 12.9 6.6 4.9 Non-Cash Wkg. Capital (5) 1 1 1
N Property Inc Gth (%) N/A 13.7 6.8 5.0 Net Cash/(Debt) (642) (653) (666) (665)
Net Inc Gth (%) N/A 20.2 7.5 4.2


Pre-Tax Income 66 80 86 89 Net Prop Inc Margins (%) 90.7 91.4 91.5 91.6
Dep. & Amort. 0 0 0 0 Net Income Margins (%) 63.6 67.7 68.3 67.9
Tax Paid 0 0 0 0 Dist to revenue (%) 72.5 75.0 75.4 74.8
Associates &JV Inc/(Loss) 0 0 0 0 Managers & Trustees fees 11.3 9.7 10.0 9.7
Chg in Wkg.Cap. 1 (5) 0 0 to sales (%)
Other Operating CF 8 9 9 9 ROAE (%) 8.9 5.3 5.7 6.0
Net Operating CF 75 83 95 98 ROA (%) 6.2 3.7 4.0 4.1
Net Invt in Properties (2,149) (6) (13) (4) ROCE (%) 7.8 4.5 4.8 5.0
Other Invts (net) 0 0 0 0 Int. Cover (x) 5.0 5.8 6.2 5.9
Invts in Assoc. & JV 0 0 0 0 Current Ratio (x) 1.1 2.3 2.2 2.3
Other Investing CF 0 0 0 0 Aggregate Leverage (%) 30.2 30.7 31.1 31.1
Net Investing CF (2,149) (6) (13) (4) Operating CFPS (S cts) 4.7 5.5 5.9 6.1
Distribution Paid (76) (88) (95) (94) Free CFPS (S cts) (129.3) 4.8 5.1 5.8
Chg in Gross Debt 662 12 13 0
New units issued 1,493 0 0 0
Other Financing CF 0 0 0 0
Net Financing CF 2,079 (76) (82) (94)
Chg in Cash 5 1 0 1

P/Book Value (x)
0.9
1.0
1.0
1.1
1.1
1.2
1.2
Aug-12 Nov-12


Page 28
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: CLGL SP
|
Reuters: CORD.SI

NOT RATED S$0.555 STI : 3,224.80
Potential Catalyst: Acquisitions in Indonesia, India and Philippines

Analyst

Andy SIM CFA +65 6398 7969
andysim@dbsvickers.com
Price Relative
82
102
122
142
162
182
202
222
0.4
0.5
0.5
0.6
0.6
0.7
0.7
0.8
0.8
Mar-12 Jun-12 Sep-12 Dec-12
Relative Index
S$
Cordlife Group Ltd (LHS) Relative STI INDEX (RHS)


FY Jun (S$ m) 2012A 2013F 2014F 2015F
Turnover 29 32 35 41
EBITDA 7 10 11 13
Net Pft (Pre Ex.) 7 9 10 11
EPS (S cts) 3.0 3.8 4.3 4.9
EPS Pre Ex. (S cts) 3.0 3.8 4.3 4.9
EPS Gth (%) (47) 28 12 15
EPS Gth Pre Ex (%) (47) 28 12 15
Net DPS (S cts) 2.0 1.9 2.1 2.5
BV Per Share (S cts) 30.6 32.5 34.6 37.1
PE (X) 18.6 14.6 13.0 11.3
PE Pre Ex. (X) 18.6 14.6 13.0 11.3
P/Cash Flow (X) 21.4 18.7 17.2 14.1
EV/EBITDA (X) 16.8 11.6 10.2 8.6
Net Div Yield (%) 3.6 3.4 3.8 4.4
P/Book Value (X) 1.8 1.7 1.6 1.5
ROAE (%) 12.4 12.1 12.7 13.7


ICB Industry : Consumer Services
ICB Sector: General Retailers
Principal Business: Provides cord blood banking services in
Singapore and Hong Kong. Its services include the collection,
processing, testing, cryopreservation and storage of umbilical cord
blood at birth.

At A Glance
Mkt. Cap (S$m/US$m) 129 / 105
Major Shareholders
China Stem Cells East Co Ltd (%) 10.5
Lau Wai Chi Stellan (%) 9.4
Coop International Pte Ltd (%) 8.8
Free Float (%) 64.1
Cordlife Group Ltd
Stable recurring income

Larger of only two private cord blood banks in
Singapore; among the top 3 in Hong Kong

Increasing penetration rate and awareness of
cord blood banking to drive growth

Stable recurring income; potential acquisitions in
Indonesia, India and Philippines
Fair value of S$0.65 offers 17% potential upside

Market leader in cord blood banking. Cordlife provides
cord blood banking services in Singapore and Hong Kong.
Its services include the collection, processing, testing,
cryopreservation and storage of umbilical cord blood at
birth. It also provides umbilical cord tissue banking services
in Hong Kong.

Increasing penetration rate and awareness of cord
blood banking to drive growth. According to the
groups IPO prospectus, the penetration level in
Singapore is expected to rise to 38% by 2015, from 24%
in 2010. In Hong Kong and China, the penetration rate is
expected to deepen to 20.6% and 5% in 2015, from
11.5% and 2% respectively in 2000.

Stable recurring income, acquisitions to boost
revenue. The bulk of its revenue is recurring, as >50% of
its customers are on an annual payment scheme.
Cordlifes target acquisition markets include Indonesia,
India and the Philippines.

Fair value S$0.65. The stock current trades at 14.0x
FY13F PE. We believe a target PE of 16x based on a slight
(<10%) discount to blended forward PE of its peers is
reasonable, given its shorter trading history. This
translates to a fair value of S$0.65, which offers potential
upside of 20% from the current share price.


Cordlife Group Ltd

Page 29

FY Jun 2012A 2013F 2014F 2015F FY Jun 2012A 2013F 2014F 2015F

Net Interest (Exp)/Inc 2 2 2 2 Total Assets 90 95 101 107

EBITDA Gth (%) (29.2) 42.8 13.9 17.1 Net Cash/(Debt) 16 18 18 19
Opg Profit Gth (%) (44.1) 72.3 18.0 21.5
Net Profit Gth (%) (18.3) 28.0 12.0 15.1
FY Jun 2012A 2013F 2014F 2015F FY Jun 2012A 2013F 2014F 2015F

Chg in Wkg.Cap. (1) (1) (1) (1) ROA (%) 9.5 9.6 10.1 11.0
Capital Exp.(net) (2) (1) (1) (1) Net Interest Cover (x) NM NM NM NM
Other Investing CF (18) 0 (2) (2) Inventory Turn (avg days) 14.4 17.9 17.7 17.6
Chg in Gross Debt 2 0 0 0 Net Debt/Equity (X) CASH CASH CASH CASH
Net Financing CF 23 (4) (5) (6) Z-Score (X) NA 5.1 5.1 NA
Currency Adjustments 0 0 0 0 N. Cash/(Debt)PS (S cts) 7.0 7.7 7.7 8.1
Chg in Cash 9 1 0 1 Opg CFPS (S cts) 2.9 3.4 3.7 4.5
Free CFPS (S cts) 1.6 2.5 2.8 3.5
FY Jun 3Q2012 4Q2012 1Q2013 FY Jun 2012A 2013F 2014F 2015F

Turnover 7 7 8 Revenues (S$ m)
Cost of Goods Sold (2) (2) (3) North Asia 7 8 9 10
Gross Profit 5 5 6 South Asia 22 24 27 30
Other Oper. (Exp)/Inc (4) (3) (3)
Operating Profit 1 2 3
Other Non Opg (Exp)/Inc 0 0 0
Associates & JV Inc 0 0 0 Total 29 32 35 41
Net Interest (Exp)/Inc 0 1 1 Pretax profit (S$ m)
Exceptional Gain/(Loss) 0 0 0 North Asia 2 2 3 3
Pre-tax Profit 1 2 3 South Asia 6 8 9 10
Tax 0 0 0
Minority Interest 0 0 0
Net Profit 1 2 3
Net profit bef Except. N/A N/A N/A Total 8 10 12 13
EBITDA 1 2 3 Pretax profit Margins (%)
North Asia 29.0 30.0 30.0 31.0
Sales Gth (%) N/A 8.2 9.8 South Asia 25.8 34.0 34.0 34.0
EBITDA Gth (%) N/A 134.4 44.4
Opg Profit Gth (%) N/A 157.5 52.6
Net Profit Gth (%) N/A 177.9 21.1
Gross Margins (%) 69.3 70.0 69.0 Total 26.6 33.0 33.0 33.3
Opg Profit Margins (%) 10.0 23.7 33.0 Key Assumptions
Net Profit Margins (%) 12.0 30.9 34.1 Revenue Growth
North Asia 10% 10% 12% 15%
South Asia 13% 10% 12% 14%


Page 30
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: PETRA SP
|
Reuters: PEFO.SI

BUY S$3.49 STI : 3,224.80

Price Target : 12-month S$ 3.97 (Prev S$ 3.97)
Potential Catalyst: M&As, special cash distributions/ dividens

Analyst
Andy SIM CFA +65 6398 7969

Price Relative
78
178
278
378
478
578
0.3
0.8
1.3
1.8
2.3
2.8
3.3
3.8
Relative Index
S$
Petra Food (LHS) Relative STI INDEX (RHS)


FY Dec (US$ m) 2011A 2012F 2013F 2014F
Turnover 1,702 1,642 1,766 1,906
EBITDA 131 126 133 156
Net Pft (Pre Ex.) 61 54 57 73
EPS (S cts) 12.2 10.9 11.4 14.6
EPS Pre Ex. (S cts) 12.2 10.9 11.4 14.6
EPS Gth (%) 36 (10) 5 27
EPS Gth Pre Ex (%) 36 (10) 5 27
Diluted EPS (S cts) 12.2 10.9 11.4 14.6
Net DPS (S cts) 4.8 5.3 5.8 6.4
BV Per Share (S cts) 59.5 65.6 71.7 80.5
PE (X) 28.8 32.2 30.7 24.1
PE Pre Ex. (X) 28.8 32.2 30.7 24.1
P/Cash Flow (X) 17.2 nm 12.4 26.6
EV/EBITDA (X) 17.2 18.6 16.9 14.4
Net Div Yield (%) 1.4 1.5 1.6 1.8
P/Book Value (X) 5.9 5.3 4.9 4.4
ROAE (%) 20.5 17.4 16.6 19.1


Principal Business: Petra Foods manufactures and markets industrial
cocoa ingredients and consumer chocolate confectioneries in the
region.

At A Glance
Mkt. Cap (S$m/US$m) 2,143 / 1,748
Major Shareholders
Berlian Enterprises Ltd (%) 50.5
Tiger Global (%) 6.4
Aberdeen Asset Management

5.8
Free Float (%) 32.3
Petra Food
Sweet prospects
An interesting play on Indonesias growth
Stock to re-rate with a focus on Branded Consumer
segment, stronger balance sheet with 60 Scts/share
cash
Pure leading confectionery player in Indonesia is a
key attraction for global players
Maintain BUY, TP: S$3.97

An interesting play on Indonesias growth. Post the
proposed disposal of the Groups Cocoa Ingredients to Barry
Callebaut (for US$950m), Petra will be focused purely on the
branded chocolate confectionery business. With an estimated
55% market share of the Indonesian market, Petra offers
investors an exposure into Indonesias consumption growth.
The group also has a 10% market share of the Philippines
chocolate confectionery market. We are projecting a topline
CAGR (FY11-14F) of c.15% for its Branded Consumer (BC)
division.
Strong balance sheet to pursue growth, increase
dividends. The group has entered into a conditional sales
and purchase agreement to dispose its CI division to Barry
Callebaut. The cash proceeds would be substantially utilised to
pare down existing debt (FY12F net gearing of 1.8x), leaving a
balance of US$300m net cash (60 Scts/share). The cash would
be used to further its BC business and/or distributed to
shareholders, providing a catalyst to share price.
Sweet prospects, BUY TP: S$3.97. The CI division has been
a drag on the groups overall performance due to industry
headwinds. We view the disposal as a positive move, and we
are positive on the development for Petra in the longer term.
We expect it to re-rate as a pure consumer play with a leading
market position in Indonesia, and growing presence in
regional markets. Longer term, we believe Petra could be an
attractive target for global chocolate confectionery players.
Our sum-of-parts based TP remains at S$3.97. Maintain BUY.

Petra Food

Page 31


Turnover 1,702 1,642 1,766 1,906 Net Fixed Assets 280 302 296 288

Sales Gth (%) 8.7 (3.5) 7.6 7.9 Non-Cash Wkg. Capital 484 582 530 570
EBITDA Gth (%) 21.2 (3.8) 6.0 16.9 Net Cash/(Debt) (502) (592) (503) (491)
Opg Profit Gth (%) 25.8 (7.3) 4.2 20.4
Net Profit Gth (%) 36.2 (10.3) 4.8 27.4

Chg in Wkg.Cap. (1) (111) 51 (45) ROA (%) 5.8 4.9 5.0 6.4
Net Operating CF 102 (16) 140 66 Div Payout Ratio (%) 39.7 48.4 50.5 43.8
Other Investing CF 0 0 0 0 Inventory Turn (avg days) 123.1 135.8 127.6 117.2
Chg in Gross Debt (25) 100 (80) 0 Net Debt/Equity (X) 1.7 1.8 1.4 1.2
Other Financing CF (27) 0 0 0 Capex to Debt (%) 9.9 8.0 4.6 4.6
Net Financing CF (74) 76 (106) (29) Z-Score (X) 3.0 3.5 3.8 4.0
Chg in Cash (24) 10 9 12 Opg CFPS (US cts.) 16.8 15.5 14.6 18.1
Free CFPS (US cts.) 8.2 (10.8) 18.9 6.7

Cost of Goods Sold (344) (339) (319) (303) Cocoa Ingredients 1,276 1,153 1,205 1,259
Gross Profit 61 64 59 57 Branded Consumer 426 489 561 647
Other Oper. (Exp)/Inc (32) (36) (31) (35)
Associates & JV Inc 0 0 0 0 Total 1,702 1,642 1,766 1,906
Net Interest (Exp)/Inc (6) (7) (7) (8) EBITDA (US$ m)
Exceptional Gain/(Loss) 0 0 0 0 Cocoa Ingredients 66 42 40 53
Pre-tax Profit 23 22 21 15 Branded Consumer 63 84 93 103
Tax (5) (6) (5) (4)
Net profit bef Except. 18 16 16 10 Total 130 126 133 156
EBITDA 36 35 34 29 EBITDA Margins (%)
Cocoa Ingredients 5.2 3.7 3.4 4.2
Sales Gth (%) (5.9) (0.8) (6.1) (4.8) Branded Consumer 14.9 17.1 16.6 15.9
EBITDA Gth (%) 14.1 (2.6) (1.8) (15.6)
Opg Profit Gth (%) 18.4 (3.7) (2.9) (19.3)
Net Profit Gth (%) 33.1 (11.0) (2.8) (34.7)
Gross Margins (%) 15.1 15.9 15.6 15.9 Total 7.6 7.7 7.6 8.2
Opg Profit Margins (%) 7.3 7.1 7.3 6.2 Key Assumptions
Net Profit Margins (%) 4.5 4.1 4.2 2.9 Bean Grinding Utilisation 91.0 88.0 88.0 88.0
EBITDA per mt of sales 250.0 150.0 140.0 179.0
BC vol growth (%) 22.0 15.0 15.0 15.0
BC ASP growth (%) 6.0 6.0 5.0 5.0
BC gross margins 31.6 33.0 33.5 33.5

Page 32
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: SUPER SP
|
Reuters: SPGP.SI

BUY S$3.23 STI : 3,224.80

Potential Catalyst: Margin expansion, volume sales growt
DBSV vs Consensus: Above on higher margins

Analyst
Alfie YEO +65 6398 7957
AlfieYeo@dbsvickers.com

Andy SIM CFA +65 6398 7969
Price Relative
73
123
173
223
273
323
373
423
473
523
0.3
0.8
1.3
1.8
2.3
2.8
3.3
Relative Index
S$
Super Group Ltd (LHS) Relative STI INDEX (RHS)


FY Dec (S$ m) 2011A 2012F 2013F 2014F
Turnover 441 499 572 666
EBITDA 65 96 121 136
Net Profit 62 79 98 111
Net Pft (Pre Ex.) 51 76 98 111
EPS (S cts) 11.1 14.2 17.5 19.9
EPS Pre Ex. (S cts) 9.1 13.7 17.5 19.9
EPS Gth (%) 6 28 23 14
EPS Gth Pre Ex (%) 8 51 28 14
Diluted EPS (S cts) 11.1 14.2 17.5 19.9
Net DPS (S cts) 5.8 7.1 8.8 10.0
BV Per Share (S cts) 65.8 72.9 81.7 91.6
PE (X) 29.1 22.7 18.4 16.2
PE Pre Ex. (X) 35.5 23.6 18.4 16.2
P/Cash Flow (X) 30.6 20.6 20.0 18.8
EV/EBITDA (X) 25.9 17.8 14.3 12.4
Net Div Yield (%) 1.8 2.2 2.7 3.1
P/Book Value (X) 4.9 4.4 4.0 3.5
ROAE (%) 17.8 20.5 22.7 23.0

Earnings Rev (%): - 1.0 -

Principal Business: Manufacturer distributor and brand owner of
instant beverages and convenience food

At A Glance
Mkt. Cap (S$m/US$m) 1,801 / 1,469
Major Shareholders
Lay Hoon Teo (%) 12.1
Kee Bock Teo (%) 11.7
YHS Invest Pte Ltd (%) 11.7
Free Float (%) 30.8

Super Group Ltd
More reasons to be upbeat
Slightly more positive outlook in FY13F
Will fire on all cylinders in FY13F, more
aggressive valuations justified.
Reiterate BUY with higher TP of S$3.51

Slightly more positive on FY13F. We turn more
positive on Supers prospects in 2013 as we believe
Super could marginally outperform our profit estimates
in FY13F. 1) Raw material prices in 4Q12 averaged 7%
lower than our assumptions which we believe will cause
margins to outperform yet again. This has led us to
believe that margins will be more favourable in the next
6-9 months as management locks in cheaper raw
material prices in FY13F. Our estimates determine that
raw material prices have declined 11% on average in
2012. 2) We believe Supers ingredient business could
gain further traction on higher volume sales in 4Q12 as
customer base and orders increase. This could provide
upside to our FY13F earnings estimate.

Will fire on all cylinders, leading to further re-
rating. FY13F earnings growth of 23% is underpinned
by better margins from Branded Consumer division and
volume sales growth from its Ingredients business.
Super now trades at 18.4x FY13F PE, above the current
valuation peg of 17x. Regional peers have re-rated to
20x FY13F over the past quarter due to a more positive
cost outlook in 2013. In line with higher peers average
valuation, and with Super strengthening its foothold in
the fast growing North Asian markets we expect
contributions to rise from 20% in 2011 to 26% in
FY13F- we revise our PE target from 17x to 20x for
Super.

Reiterate Buy at higher TP of S$3.51. Our new TP
for Super now stands at S$3.51 based on 20x FY13F PE.
Reiterate BUY.

Super Group Ltd

Page 33


Other Non Opg (Exp)/Inc (18) (2) 0 0 Debtors 78 84 96 112
Net Interest (Exp)/Inc 0 0 0 0 Total Assets 502 544 601 667
Minority Interest (2) (3) (4) (5) LT Debt 0 0 0 0

EBITDA Gth (%) 1.9 46.8 25.5 12.9 Net Cash/(Debt) 123 105 101 132
Opg Profit Gth (%) 23.3 16.2 27.4 13.7
Net Profit Gth (%) 6.1 28.0 23.3 13.5

Assoc. & JV Inc/(loss) (1) (1) 0 0 ROAE (%) 17.8 20.5 22.7 23.0
Chg in Wkg.Cap. (7) (2) (18) (26) ROA (%) 13.0 15.1 17.1 17.5
Capital Exp.(net) (73) (66) (44) (10) Net Interest Cover (x) NM NM NM NM
Chg in Gross Debt (1) 0 0 0 Net Debt/Equity (X) CASH CASH CASH CASH
Other Financing CF 0 0 0 0 Capex to Debt (%) 4,324.0 3,905.3 2,615.4 591.7
Net Financing CF (33) (40) (49) (55) Z-Score (X) 6.8 11.4 11.3 11.0
Currency Adjustments 1 0 0 0 N. Cash/(Debt)PS (S cts) 22.0 18.8 18.2 23.6
Chg in Cash (19) (18) (3) 30 Opg CFPS (S cts) 11.8 16.0 19.4 21.8
Free CFPS (S cts) (2.5) 3.8 8.2 15.4

Cost of Goods Sold (81) (80) (72) (83) Singapore 102 127 143 166
Gross Profit 39 41 40 47 South East Asia 248 289 332 386
Other Oper. (Exp)/Inc (24) (21) (20) (23) East Asia 91 82 97 113
Other Non Opg (Exp)/Inc 0 0 (1) (1)
Net Interest (Exp)/Inc 0 0 0 0 Segment results (S$ m)
Exceptional Gain/(Loss) 11 0 0 2 Singapore 11 45 63 70
Pre-tax Profit 25 21 19 26 South East Asia 37 32 36 42
Tax (1) (2) (1) (3) East Asia 29 12 14 16
Minority Interest (1) (1) (1) (1)
EBITDA 16 22 21 26 Segment results Margins
Singapore 10.4 35.6 44.1 42.3
Sales Gth (%) 12.7 0.8 (7.9) 16.1 South East Asia 15.0 11.0 11.0 11.0
EBITDA Gth (%) 3.5 35.8 (5.6) 26.3 East Asia 31.7 14.5 14.5 14.5
Opg Profit Gth (%) 38.1 36.8 (3.1) 25.0
Net Profit Gth (%) 91.2 (24.1) (0.9) 29.0
Net Profit Margins (%) 19.3 14.5 15.6 17.4 Consumer goods 318.6 360.1 422.7 492.0
Ingredients 122.4 139.0 149.2 173.5
Total 441.0 499.1 571.9 665.5


Page 34
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ed: OY / sa: JC

Bloomberg: TGR SP
|
Reuters: TAHL.SI

BUY S$0.735 STI : 3,224.80

Potential Catalyst: Earnings turnaround, Tiger Australia stake sale
DBSV vs Consensus: Slighlty more bullish on profitability

Analyst
Suvro SARKAR +65 6398 7973
suvro@dbsvickers.com

Price Relative
41
61
81
101
121
141
161
181
201
221
0.5
0.7
0.9
1.1
1.3
1.5
1.7
1.9
2.1
Jan-10 Jan-11 Jan-12
Relative Index
S$
Tiger Airways Holdings (LHS) Relative STI INDEX (RHS)


FY Mar (S$ m) 2012F 2013F 2014F 2015F
Turnover 618 851 625 680
EBITDA (52) 31 107 128
Pre-tax Profit (101) 104 55 75
Net Profit (104) 103 47 64
Net Pft (Pre Ex.) (95) (17) 47 64
EPS (S cts) (15.8) 12.5 5.7 7.8
EPS Pre Ex. (S cts) (14.3) (2.1) 5.7 7.8
EPS Gth (%) (313) (179) (54) 36
EPS Gth Pre Ex (%) (386) (85) (370) 36
Diluted EPS (S cts) (15.8) 12.5 5.7 7.8
Net DPS (S cts) 0.0 0.0 0.0 0.0
BV Per Share (S cts) 30.3 42.7 48.4 56.2
PE (X) nm 5.9 12.9 9.5
PE Pre Ex. (X) nm nm 12.9 9.5
P/Cash Flow (X) nm 3.7 21.2 6.0
EV/EBITDA (X) nm 34.1 10.9 8.3
Net Div Yield (%) 0.0 0.0 0.0 0.0
P/Book Value (X) 2.4 1.7 1.5 1.3
ROAE (%) (47.1) 34.2 12.5 14.9


ICB Industry : Consumer Services
ICB Sector: Travel & Leisure
Principal Business: Low cost airline in Singapore and Australia

At A Glance
Mkt. Cap (S$m/US$m) 603 / 492
Major Shareholders
Singapore Airlines (%) 33.1
Temasek Holdings (%) 8.1
Free Float (%) 35.1
Tiger Airways Holdings
Well-positioned for growth

Improving operating data in recent months,
potential of earnings turnaround in 3Q-FY13

Growth at Tiger Singapore will be key to
restoring profitability in near term
Leveraged to rebound in Asian growth
Maintain BUY with TP S$0.95
Tiger Singapore has been having steady success in
growing its traffic. With the introduction of new routes
and increased frequencies to popular destinations, Tiger
Singapores traffic has been growing at 30%+ y-o-y in the last
two months, while maintaining robust load factors of close to
85%. This demonstrates the groups renewed growth push in
its more profitable Singapore operations, given that Tiger
Australia operations have stabilised now. The robust operating
data in recent months augurs well for Tiger Singapore's
profitability in the peak season quarter (3Q-FY13) and beyond.

As Asian skies get busier. Our investment outlook is
lifted by a more positive outlook for Asian growth, driven by a
rebound in China, which is enough in itself to drive faster
growth in Asia. We are looking at growth returning to 9% in
China and 6% in Asia-10, which should help boost air traffic
in the region. With more Intra-Asian FTAs being announced
and the ASEAN open skies policy expected to be implemented
In 2015, Singapore should emerge as a key regional hub, and
Tiger is well positioned to ride on this trend, with its portfolio
of airlines in Singapore, the Philippines and Indonesia.

Potential turnaround in the works. The group recently
announced the proposed divestment of a 60% stake in Tiger
Australia to Virgin Australia, which we view as a positive move
to tackle the challenging competitive landscape in the
Australian domestic sector. However, this transaction is
subject to shareholder and regulator approvals. It might take a
while to fruition. Meanwhile, we continue to look forward to
a turnaround in earnings for Tiger Airways group in the
coming quarters. Maintain BUY with S$0.95 TP.


Tiger Airways Holdings

Page 35

FY Mar 2012F 2013F 2014F 2015F FY Mar 2012F 2013F 2014F 2015F

Turnover 618 851 625 680 Net Fixed Assets 832 988 1,094 1,052
Gross Profit (83) (2) 59 74 Other LT Assets 39 39 39 39
Other Opng (Exp)/Inc 0 0 0 0 Cash & ST Invts 169 188 119 168
Operating Profit (83) (2) 59 74 Inventory 24 33 24 26
Exceptional Gain/(Loss) (10) 120 0 0
Pre-tax Profit (101) 104 55 75 ST Debt 205 205 205 155
Net Profit (104) 103 47 64 Shareholders Equity 248 351 398 462
Net Profit before Except. (95) (17) 47 64 Minority Interests 0 0 0 0
EBITDA (52) 31 107 128 Total Cap. & Liab. 1,072 1,257 1,291 1,311

Sales Gth (%) (0.6) 37.6 (26.5) 8.7 Non-Cash Wkg. Capital (169) (191) (138) (142)
EBITDA Gth (%) (186.9) (159.2) 248.2 19.8 Net Cash/(Debt) (415) (446) (565) (466)
Opg Profit Gth (%) (276.6) (97.2) (2,584.0) 26.8
Net Profit Gth (%) (361.5) (198.4) (54.4) 36.4
Effective Tax Rate (%) N/A 1.8 14.9 14.5
FY Mar 2012F 2013F 2014F 2015F FY Mar 2012F 2013F 2014F 2015F

Pre-Tax Profit (101) 104 55 75 Gross Margins (%) (13.5) (0.3) 9.4 11.0
Dep. & Amort. 31 36 42 43 Opg Profit Margin (%) (13.5) (0.3) 9.4 11.0
Tax Paid (1) (3) (2) (8) Net Profit Margin (%) (16.9) 12.1 7.5 9.4
Assoc. & JV Inc/(loss) 0 3 (7) (11) ROAE (%) (47.1) 34.2 12.5 14.9
Chg in Wkg.Cap. (42) 23 (59) 1 ROA (%) (10.1) 8.8 3.7 4.9
Other Operating CF 0 0 0 1 ROCE (%) (10.1) (0.2) 4.7 5.6
Net Operating CF (112) 164 28 101 Div Payout Ratio (%) N/A 0.0 0.0 0.0
Capital Exp.(net) (123) (192) (147) (1) Net Interest Cover (x) (11.0) (0.2) 5.5 7.0
Chg in Gross Debt 43 50 50 (50) Net Debt/Equity (X) 1.7 1.3 1.4 1.0
Net Financing CF 186 50 50 (50) Z-Score (X) 0.2 0.8 0.8 NA
Currency Adjustments 0 0 0 0 N. Cash/(Debt)PS (S cts) (50.6) (54.3) (68.8) (56.8)
Chg in Cash (55) 19 (69) 50 Opg CFPS (S cts) (10.6) 17.2 10.7 12.1
Free CFPS (S cts) (35.7) (3.4) (14.5) 12.1
FY Mar 3Q2012 4Q2012 1Q2013 2Q2013 FY Mar 2012F 2013F 2014F 2015F

Cost of Goods Sold (181) (178) (193) (208) Passenger Revenue 500 686 504 547
Gross Profit (13) (17) (12) (12) Ancillary Revenue 118 165 122 132
Other Oper. (Exp)/Inc 0 0 0 0
Operating Profit (13) (17) (12) (12) Total 618 851 625 680
Associates & JV Inc 0 0 0 (4) Key Assumptions
Net Interest (Exp)/Inc (2) (2) (2) (2) No of Aircraft (YE) 35.0 43.0 50.0 57.0
Exceptional Gain/(Loss) (2) 0 1 1 RPK (m) 8,494.0 10,737.0 12,852.6 13,717.5
Pre-tax Profit (17) (19) (13) (17) PLF (%) 81.3 84.1 85.8 84.2
Tax 0 3 (1) (2) Yield (Scts) 7.3 7.9 8.1 8.3
Minority Interest 0 0 0 0 CASK (Scts) 6.8 6.7 6.6 6.5
Net Profit (17) (16) (14) (18)
Net profit bef Except. (15) (16) (14) (19)
EBITDA (5) (9) (4) (7)

Sales Gth (%) 53.2 (4.4) 12.5 8.5
EBITDA Gth (%) (85.1) 87.1 (60.2) 94.3
Opg Profit Gth (%) (68.5) 32.3 (31.2) (2.5)
Net Profit Gth (%) (65.1) (5.8) (16.5) 33.6
Gross Margins (%) (7.7) (10.6) (6.5) (5.8)
Opg Profit Margins (%) (7.7) (10.6) (6.5) (5.8)
Net Profit Margins (%) (10.4) (10.2) (7.6) (9.3)


Page 36
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ed: OY / sa: JC

Bloomberg: MIDAS SP
|
Reuters: MIDA.SI

BUY S$0.455 STI : 3,224.80

Potential Catalyst: Contract wins
DBSV vs Consensus: We have lower FY13 but higher FY14 estimates
than consensus, as we believe Midas should see a strong turnaround,
but only from 2H13 onwards.

Analyst

rice Relative
32
52
72
92
112
132
152
172
192
212
0.2
0.4
0.6
0.8
1.0
1.2
Relative Index
S$
Midas Holdings (LHS) Relative STI INDEX (RHS)


FY Dec (RMB m) 2011A 2012F 2013F 2014F
Turnover 1,081 881 1,181 1,511
EBITDA 346 226 401 548
Net Profit 187 14 151 236
Net Pft (Pre Ex.) 187 14 151 236
EPS (S cts) 3.0 0.2 2.4 3.8
EPS Pre Ex. (S cts) 3.0 0.2 2.4 3.8
EPS Gth (%) (33) (92) 955 57
EPS Gth Pre Ex (%) (33) (92) 955 57
Net DPS (S cts) 0.9 0.5 0.5 1.0
BV Per Share (S cts) 48.0 47.3 49.3 52.6
PE (X) 15.1 198.0 18.8 12.0
PE Pre Ex. (X) 15.1 198.0 18.8 12.0
P/Cash Flow (X) nm 37.3 10.0 5.0
EV/EBITDA (X) 9.4 16.4 10.6 8.6
Net Div Yield (%) 2.0 1.1 1.1 2.2
P/Book Value (X) 1.0 1.0 0.9 0.9
ROAE (%) 6.4 0.5 5.0 7.5

Earnings Rev (%): (76.7) (8.4) (1.8)

ICB Industry : Basic Materials
ICB Sector: Industrial Metals
Principal Business: Manufactures Aluminium Alloy extrusion
products and Polyethylene Pipes. It also has a joint venture which
manufactures train cars.

At A Glance
Mkt. Cap (S$m/US$m) 557 / 454
Major Shareholders
Chen Wei Ping (%) 10.8
Chew Hwa Kwang, Patrick (%) 10.0
JP Morgan Chase (%) 7.0
Free Float (%) 72.2
Midas Holdings
Poised for a turnaround

Midas has enhanced both its capacity and
capabilities during this lull period

Winning more orders from wider sources
should boost the groups earnings prospects

Impending high speed train orders from Chinas
MOR could be a catalyst for re-rating
Maintain BUY with TP S$0.50 (1x FY13 P/B)

Enhanced capacity and capabilities. Whilst orders
have been slow in coming through to Midas, it has
been enhancing both its production capacity and
capabilities, in addition to diversifying its product range.
Jilin Midas now has an aluminium extrusion production
capacity of 50,000 tonnes per annum and can fabricate
a complete range of train parts, including for export.

More contracts to flow in, and boost profitability
in 2013 and 2014. We expect Midas to comfortably
win orders of c.Rmb1bn from metro, export and the
non-rail segments (power and other extrusion products)
over the next 12 months, while high-speed train orders
will depend on how soon the Ministry of Railway (MoR)
makes its purchases. If the MoR does order 400 train
sets, as people in the industry expect, we project that
Midas could win c.Rmb1bn worth of high-speed train
orders for delivery over the next two to three years.
Meanwhile, associate Nanjing Puzhen should also see an
earnings turnaround on its strong Rmb8.5bn order book.

BUY for 2013 turnaround story, TP S$0.50. Midas is
currently trading at 0.8x FY13 P/B, which we see as
attractive for a turnaround story. We believe the stock
should re-rate as contracts start to flow in once again
for the group. Our TP is based on 1x FY13 P/B.


Midas Holdings

Page 37

Income Statement (RMB m) Balance Sheet (RMB m)

Turnover 1,081 881 1,181 1,511 Net Fixed Assets 2,174 2,517 3,203 4,056
Cost of Goods Sold (719) (612) (796) (1,017) Invts in Associates & JVs 193 168 201 253
Minority Interest 0 1 1 2 LT Debt 183 583 783 1,183

Sales Gth (%) 4.9 (18.5) 34.0 27.9 Non-Cash Wkg. Capital 1,014 1,084 1,041 816
EBITDA Gth (%) (2.8) (34.8) 77.4 36.7 Net Cash/(Debt) (432) (580) (1,136) (1,611)
Opg Profit Gth (%) (1.6) (44.3) 70.2 39.8
Net Profit Gth (%) (22.2) (92.4) 954.7 56.8
Cash Flow Statement (RMB m) Rates & Ratio

Assoc. & JV Inc/(loss) (8) 24 (33) (51) ROAE (%) 6.4 0.5 5.0 7.5
Chg in Wkg.Cap. (423) (70) 43 226 ROA (%) 4.7 0.3 2.9 4.2
Net Operating CF (197) 76 284 567 Div Payout Ratio (%) 30.9 212.8 20.2 25.7
Capital Exp.(net) (741) (451) (811) (1,011) Net Interest Cover (x) 6.6 1.7 2.8 3.6
Net Investing CF (750) (451) (811) (1,011) Current Ratio (x) 1.7 1.9 1.6 1.3
Net Financing CF 355 628 170 370 Z-Score (X) 2.2 1.5 1.5 1.3
Currency Adjustments 0 0 0 0 N. Cash/(Debt)PS (RMB cts) (35.5) (47.6) (93.3) (132.3)
Chg in Cash (592) 253 (357) (74) Opg CFPS (RMB cts) 18.6 12.0 19.8 28.0
Free CFPS (RMB cts) (77.0) (30.8) (43.2) (36.5)
Quarterly / Interim Income Statement (RMB m) Segmental Breakdown / Key Assumptions

Turnover 211 230 220 203 Revenues (RMB m)
Cost of Goods Sold (146) (163) (151) (139) Aluminium Alloy + 1,039 840 1,140 1,470
Gross Profit 65 68 69 64 Polyethylene Pipe 41 41 41 41
Other Oper. (Exp)/Inc (32) (30) (27) (34) Agency & Procurement 0 0 0 0
Associates & JV Inc 2 (5) (14) (7) Total 1,081 881 1,181 1,511
Net Interest (Exp)/Inc (16) (14) (20) (25) Gross Profit (RMB m)
Exceptional Gain/(Loss) 0 0 0 0 Aluminium Alloy + 353 260 376 485
Pre-tax Profit 20 20 8 (2) Polyethylene Pipe 9 9 9 9
Tax 17 (5) (7) (5) Agency & Procurement 0 0 0 0
Net Profit 37 15 2 (6)
Net profit bef Except. 37 15 2 (6) Total 362 269 385 494
EBITDA 63 59 54 51 Gross Profit Margins (%)
Aluminium Alloy + 34.0 31.0 33.0 33.0
Sales Gth (%) (18.6) 9.2 (4.6) (7.8) Polyethylene Pipe 22.0 21.0 21.0 21.0
EBITDA Gth (%) (17.5) (5.6) (9.4) (4.5) Agency & Procurement N/A N/A N/A N/A
Opg Profit Gth (%) (43.4) 14.0 10.9 (29.2)
Net Profit Gth (%) 33.8 (58.5) (89.5) (483.8)
Net Profit Margins (%) 17.4 6.6 0.7 (3.0) Aluminium Capacity (tonnes) 45,000.0 50,000.0 50,000.0 60,000.0
Al Utilisation Rate (%) 55.0 45.0 55.0 60.0
Al Gross Margin (%) 34.0 31.0 33.0 33.0
NPRT Revenue (RMB) 2,007.8 1,500.0 2,925.0 3,150.0
NPRT Net Margin (%) 1.3 (5.0) 3.5 5.0

Page 38
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ed: JS / sa: JC

Bloomberg: PCRT SP
|
Reuters: PCRT.SI

BUY S$0.585 STI : 3,224.80

Potential Catalyst: Improvement in operating earnings, realisation of
NAV
DBSV vs Consensus: Above

Analyst
LOCK Mun Yee +65 6398 7972
munyee@dbsvickers.com

Price Relative
59
79
99
119
139
159
179
199
219
0.4
0.5
0.5
0.6
0.6
0.7
0.7
0.8
0.8
Jun-11 Nov-11 Apr-12 Sep-12
Relative Index
S$
Perennial China Retail Trust (LHS) Relative STI INDEX (RHS)


FY Dec (S$ m) 2011A 2012F 2013F 2014F
Total Return 6 (3) 6 11
EPU (S cts) 0.5 (0.3) 0.5 1.0
EPU Gth (%) N/A (157) (271) 86
DPU (S cts) 2.4 3.9 4.1 4.3
DPU Gth (%) N/A 66 5 6
NAV per shr (S cts) 70.7 71.1 71.1 71.1
PE (X) 109.1 nm 111.0 59.5
P/NAV (x) 0.8 0.8 0.8 0.8
ROAE (%) 1.5 (0.4) 0.7 1.4

Distn. Inc Chng (%): - - -

ICB Sector: Real Estate Investment Trusts
Principal Business: PCRT is Singapores first pure play PRC retail
development business trust with an initial portfolio of 5 properties
in Shenyang, Chengdu and Foshan

At A Glance
Mkt. Cap (S$m/US$m) 666 / 544
Major Shareholders
Khoon Hong Kuok (%) 17.2
Din Hwa Chen (%) 11.8
Asdes Acquistion (%) 10.8
Free Float (%) 42.9

Shopping for growth

Pure China retail play with high dividend yield

Plentiful drivers from portfolio ramp up and new
investments
Maintain Buy with TP S$0.84

Pure China retail play. Perennial China Retail Trust (PCRT)
is a pure play into the retail consumption growth in China
through its malls in Shenyang, Chengdu and Foshan. It
offers investors attractive dividend yields of 7.2-7.7% as
well as the potential for NAV realisation as the
development assets are completed. This is likely to close the
gap between stock price and our RNAV estimate.

Ramping up portfolio performance. We see FY13 as an
earnings inflexion point with new contributions from the
Perennial Jihua Mall Foshan development. The mall is more
than 50% pre-leased with international retailers as well as
key supermarket and cinema tenants. Furthermore, we
believe there is upside to book NAV of S$0.68/unit towards
our revalued asset backing when the mall is completed in
1QFY13. In the medium term,the completion of the
Perennial Qingyang Mall in Chengdu by 2QFY14 will
provide another driver to earnings and book NAV.
Meanwhile, the gradual ramp up of the Shenyang
Shopping Mall (70% occupied currently) and the AEIs at
Red Star Macalline Furniture Mall as well as the Shenyang
Office component should pick up during this Earn Out
period. Meanwhile, new investments into the Perennial
Dongzhan Mall and Beijing Tongzhou projects should bear
fruit in the medium to long term.

Retain Buy call. We maintain our Buy call on PCRT with a
RNAV-backed TP of S$0.84. The stock is trading at c0.8x
P/Bk NAV and close to replacement level for the initial
portfolio. With a remaining Rmb342m of Earn Out
Support, there is clear visibility on distributions during this
period of operational ramp up.



Page 39


Gross revenue 0 0 10 24 Investment Properties 0 175 364 523
Property expenses 0 0 (2) (8) Other LT Assets 764 819 834 861
Exceptional Gain/(Loss) 0 0 0 0 Total Assets 921 1,129 1,347 1,545
Net Income 6 (3) 9 16
Tax 0 0 (3) (5) ST Debt 0 0 0 0
Net Income After Tax 6 (3) 6 11 Other LT Liabilities 6 6 6 6
Total Return 6 (3) 6 11 Unit holders funds 793 801 806 812
Non-tax deductible Items (5) 6 6 6 Minority Interests 0 0 0 0
Net Inc available for Dist. 1 3 12 17 Total Funds & Liabilities 921 1,129 1,347 1,545

Revenue Gth (%) N/A N/A N/A 134.2 Non-Cash Wkg. Capital (34) (34) (37) (39)
N Property Inc Gth (%) N/A N/A N/A 99.7 Net Cash/(Debt) 69 (152) (350) (527)
Net Inc Gth (%) N/A (158.1) (272.0) 87.8


Pre-Tax Income 6 44 46 49 Net Prop Inc Margins (%) N/A N/A 75.7 64.5
Dep. & Amort. 0 5 5 7 Net Income Margins (%) N/A N/A 58.8 47.2
Tax Paid 0 0 (3) (5) Dist to revenue (%) N/A N/A 116.4 73.2
Associates &JV Inc/(Loss) (12) (5) (16) (27) Managers & Trustees fees N/A N/A 72.4 36.2
Chg in Wkg.Cap. 6 0 0 0 to sales (%)
Other Operating CF 4 0 0 0 ROAE (%) 1.5 (0.4) 0.7 1.4
Net Operating CF 4 45 33 24 ROA (%) 1.3 (0.3) 0.5 0.8
Net Invt in Properties 0 (175) (189) (159) ROCE (%) (1.1) (0.6) 0.0 0.3
Other Invts (net) 0 0 0 0 Int. Cover (x) (4.5) (4.1) 0.0 0.4
Invts in Assoc. & JV (660) (50) 0 0 Current Ratio (x) 3.0 2.6 2.7 2.8
Other Investing CF (19) 0 0 0 Aggregate Leverage (%) 9.0 27.0 39.9 48.3
Net Investing CF (680) (225) (189) (159) Z-Score (X) 0.0 0.0 0.8 0.7
Distribution Paid 0 (44) (46) (49) Operating CFPS (S cts) (0.2) 4.0 2.9 2.1
Chg in Gross Debt 73 200 210 190 Free CFPS (S cts) 0.3 (11.6) (13.8) (11.8)
New units issued 776 3 5 6
Other Financing CF (77) 0 0 0
Net Financing CF 773 159 168 147
Chg in Cash 97 (21) 12 12

Quarterly / Interim Income Statement (S$ m) P/Book Value (x)
FY Dec 4Q2011 1Q2012 2Q2012 3Q2012
0.5
0.6
0.6
0.7
0.7
0.8
0.8
0.9
0.9
1.0
1.0
Jun-11 Nov-11 Apr-12 Sep-12

Gross revenue 0 0 0 0
Property expenses 0 0 (1) 0
Net Property Income 0 0 (1) 0
Other Operating expenses (3) 1 (1) (1)
Net Interest (Exp)/Inc 0 0 (1) (2)
Net Income 8 2 4 (2)
Tax 0 0 0 0
Net Income after Tax 8 2 4 (2)
Total Return 8 2 4 (2)
Non-tax deductible Items 0 0 0 0
Net Inc available for Dist. 0 0 0 0

Revenue Gth (%) N/A N/A N/A N/A
N Property Inc Gth (%) N/A N/A N/A (80)
Net Inc Gth (%) (1,088) (77) 136 (147)
Net Prop Inc Margin (%) N/A N/A N/A N/A


Page 40
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ed: OY / sa: JC

Bloomberg: UENV SP
|
Reuters: UNIT.SI

BUY S$0.515 STI : 3,224.80

Price Target : 12-Month S$ 0.69* (S$0.92**)
Potential Catalyst: Higher plant utilizations, expansion, acquisitions

* based on fully dilution of convertible bonds into 302m shares
** based on existing share cap

Analyst
TAN Ai Teng +65 6398 7967
Price Relative
20
70
120
170
220
270
320
0.00
0.20
0.40
0.60
2008 2010 2011 2012
United Environment (LHS) Relative STI Index (RHS)
Relative Index
S$


FY Mar (S$ m) 2012A 2013F 2014F 2015F
Turnover 85 150 164 209
EBITDA 21 49 68 81
Net Pft (Pre Ex.) 10 27 47 57
EPS (S cts) 2.2 5.5 5.9 7.2
EPS Pre Ex. (S cts) 2.2 5.5 5.9 7.2
EPS Gth (%) (35) 149 8 21
EPS Gth Pre Ex (%) (35) 149 8 21
Net DPS (S cts) 0.3 0.7 0.8 1.0
BV Per Share (S cts) 37.3 41.1 45.3 51.4
PE (X) 23.5 9.4 8.7 7.2
PE Pre Ex. (X) 23.5 9.4 8.7 7.2
P/Cash Flow (X) 50.8 7.7 9.6 7.5
EV/EBITDA (X) 15.7 8.6 7.1 5.4
Net Div Yield (%) 0.6 1.5 1.6 1.9
P/Book Value (X) 1.4 1.3 1.1 1.0
ROAE (%) 6.6 14.1 16.8 14.8

Consensus EPS (S cts): 4.8 5.9 -

ICB Industry : Utilities
ICB Sector: Gas; Water & Multiutilities
Principal Business: Key membrane bio-reactor supplier inAsia. Also
owns a growing portfolio of water assets in China.

At A Glance
Mkt. Cap (S$m/US$m) 247 / 201
Major Shareholders
Yu Cheng Lin (%) 18.1
Ching Wah Goh (%) 17.8
Oei Hong Leong Peter (%) 17.6
Free Float (%) 46.5

United Envirotech
Stable flow of recurring income

Initiate coverage with BUY, +41% to fully diluted TP
of S$0.69
Expect earnings breakthrough as recurring
income streams gather momentum
Attractive at 8x/7xPE for 75%/21% PATMI
growth in FY14F/15F, industry averages 13x
Potential upside from acquisitions & expansion;
CB dilution can be potential overhang
>60% of profits coming from long-term recurring
treatment income. United Envirotech (UENV), a membrane-
based wastewater treatment company, has been shifting to a
stable, recurring and more profitable earnings profile with the
acquisition of operating water plants in China. By FY14Mar,
UENV would have a total processing capacity of 1.18m m3/day
to generate S$25m or 60% of group PATMI. This treatment
income is recurring for the life of the water concessions (30 yrs).

Key beneficiary of Chinas rapid growth in environmental
protection. Besides treatment services, UENV should continue
to win engineering and construction (EPC) contracts given the
growing demand for membrane-based water treatment plants
in China to meet stricter discharge limits, which old plants are
not equipped to process. We believe UENV can maintain
~Rmb400m of new EPC orders over the next two years.

Earnings CAGR of 46% from FY13F-FY15F. UENV has
potential upside from higher utilisation rates. Besides, we have
not incorporated the Phase 2 expansion or acquisitions.

BUY, TP S$0.69. Our sum-of-parts TP is based on 10x PE for
EPC and DCF valuation (8.6% WACC) for treatment. We have
also assumed full dilution of the S$136.2m convertible bond to
Kholberg Kravis Roberts & Co (KKR).

United Envirotech

Page 41

FY Mar 2012A 2013F 2014F 2015F FY Mar 2012A 2013F 2014F 2015F

Net Interest (Exp)/Inc (5) (11) (3) (4) Total Assets 401 476 539 626

EBITDA Gth (%) 5.4 133.0 37.8 19.9 Net Cash/(Debt) (87) (173) (74) (33)
Opg Profit Gth (%) 28.8 144.4 44.9 22.3
Net Profit Gth (%) (34.6) 155.8 75.2 20.9
FY Mar 2012A 2013F 2014F 2015F FY Mar 2012A 2013F 2014F 2015F

Chg in Wkg.Cap. (19) 1 (10) (4) ROA (%) 3.4 6.1 9.2 9.7
Invts in Assoc. & JV (20) 0 0 0 Debtors Turn (avg days) 140.3 121.4 139.5 130.5
Other Investing CF (75) (100) (50) 0 Inventory Turn (avg days) 4.3 2.9 4.0 3.3
Chg in Gross Debt 5 25 (97) 20 Net Debt/Equity (X) 0.5 0.9 0.2 0.1
Net Financing CF 139 21 14 12 Z-Score (X) 0.0 0.0 0.0 NA
Currency Adjustments 0 0 0 0 N. Cash/(Debt)PS (S cts) (18.1) (35.2) (9.4) (4.1)
Chg in Cash 42 (61) 1 62 Opg CFPS (S cts) 5.0 6.4 6.6 7.4
Free CFPS (S cts) (0.4) 3.6 4.7 6.3
FY Mar 3Q2012 4Q2012 1Q2013 2Q2013 FY Mar 2012A 2013F 2014F 2015F

Cost of Goods Sold (12) (8) (18) (35) EPC 62 113 80 113
Gross Profit 8 11 14 19 Treatment 23 37 84 96
Other Oper. (Exp)/Inc (5) (6) (6) (7) Others N/A N/A N/A N/A
Other Non Opg (Exp)/Inc 2 (1) 0 0
Associates & JV Inc 1 (1) 1 1 Total 85 150 164 209
Net Interest (Exp)/Inc (3) (1) (3) (3) EBIT (S$ m)
Exceptional Gain/(Loss) 0 0 0 0 EPC 8 28 20 28
Pre-tax Profit 3 2 7 10 Treatment 12 15 42 48
Tax (1) (1) (1) (1) Others (2) 0 0 0
Net Profit 2 1 6 8
EBITDA 6 5 10 13 EBIT Margins (%)
EPC 13.0 25.0 25.0 25.0
Sales Gth (%) (20.1) (4.9) 67.3 68.2 Treatment 51.2 40.0 50.0 50.0
EBITDA Gth (%) 3.9 (22.5) 122.5 31.6 Others N/A N/A N/A N/A
Opg Profit Gth (%) (38.1) 86.2 58.5 36.8
Net Profit Gth (%) (49.2) (29.0) 339.4 42.2
Net Profit Margins (%) 9.4 7.0 18.4 15.5 EPC order win 280.0 420.0 400.0 400.0


Page 42
www.dbsvickers.com

sa: JC

Bloomberg: ASL SP
|
Reuters: ASLM.SI

BUY S$0.68 STI : 3,224.80

Potential Catalyst: Order wins
DBSV vs Consensus: Above

Analyst

Price Relative
84
104
124
144
164
184
204
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
Relative Index
S$
ASL Marine Holdings (LHS) Relative STI INDEX (RHS)


FY Jun (S$ m) 2011A 2012A 2013F 2014F
Turnover 363 391 525 659
EBITDA 83 84 104 121
Net Pft (Pre Ex.) 32 32 49 60
EPS (S cts) 7.6 7.7 11.7 14.3
EPS Pre Ex. (S cts) 7.6 7.7 11.7 14.3
EPS Gth (%) (14) 1 52 23
EPS Gth Pre Ex (%) (14) 1 52 23
Diluted EPS (S cts) 7.6 7.7 11.7 14.3
Net DPS (S cts) 1.5 1.5 2.3 2.8
BV Per Share (S cts) 79.6 83.9 93.3 104.8
PE (X) 9.0 8.9 5.8 4.7
PE Pre Ex. (X) 9.0 8.9 5.8 4.7
P/Cash Flow (X) 8.3 3.8 4.3 3.3
EV/EBITDA (X) 6.1 5.8 4.7 3.7
Net Div Yield (%) 2.2 2.2 3.4 4.2
P/Book Value (X) 0.9 0.8 0.7 0.6
ROAE (%) 9.8 9.4 13.2 14.5


Principal Business: ASL Marine Holdings Ltd is an integrated marine
services company. Their core businesses are shipbuilding, shiprepair
and chartering.

At A Glance
Mkt. Cap (S$m/US$m) 287 / 234
Major Shareholders
Ang Kok Tian (%) 13.7
Ang Ah Nui (%) 13.1
Ang Kok Eng (%) 11.5
Free Float (%) 42.3
ASL Marine Holdings
Strong orderbook

Small acquisition to move ASL up the value chain,
build on its niche in dredgers

Strong order book for FY13F/FY14F, focus on OSV

Maintain BUY, TP S$0.90; valuations compelling

Moving up the value chain. ASL has recently acquired Vosta
LMG, an established international dredging engineering and
contracting company for EUR5.1m. The successful acquisition
and integration of Vosta LMG would allow ASL to further build
on its niche of constructing dredgers. However, the near- to
medium-term financial impact remains unclear, given that this
company was loss-making for the 12 months ended June
2012.
Strong order book for FY13F/FY14F, focus on OSV in
O&G for earnings turnaround. Orderbook remains healthy
at S$573m for 37 vessels as of end 1Q13. With a book-to-bill
of 1.4x, this will underpin earnings growth for FY13, with
upside to 2014 forecasts from margin improvement. Demand
for offshore support vessels continues to be healthy, supported
by improved E&P activities for the Indonesia, Australia, and
North Sea markets. ASL is also chartering its OSV fleet for
longer contract terms with long term charter contracts of
S$54m. Plans to grow its chartering fleet 188 vessels
currently, with 28 new vessels on order for FY13F and FY14F
will underpin growth
Maintain BUY, TP S$0.90. Our TP of S$0.90, pegged to 7x
FY13 PE for its shipbuilding and chartering business and 10x
for ship repair. Current valuations are compelling, with ASL
trading at 5.8x/4.7x FY13/14 PE, and a mere 0.8x FY12 P/BV,
against a FY12-14 recurring EPS CAGR of 37% and FY13/14
ROAE of 13-14%. Maintain BUY on ASL for its strong
earnings recovery, good execution, strong earnings visibility
on healthy shipbuilding orderbook and a resurging ship repair
business.


ASL Marine Holdings

Page 43


Associates & JV Inc (1) 0 0 1 Other Current Assets 101 86 131 164
Net Interest (Exp)/Inc (9) (10) (11) (11) Total Assets 779 854 1,009 1,140
Minority Interest (1) 0 (2) (3) LT Debt 156 175 175 175
EBITDA 83 84 104 121 Total Cap. & Liab. 779 854 1,009 1,139

Sales Gth (%) (22.5) 7.7 34.1 25.6 Non-Cash Wkg. Capital 67 47 66 78
Opg Profit Gth (%) (16.4) (1.0) 45.4 22.1
Net Profit Gth (%) (14.4) 1.3 52.1 22.9

Assoc. & JV Inc/(loss) 1 0 0 (1) ROAE (%) 9.8 9.4 13.2 14.5
Chg in Wkg.Cap. (30) (1) (20) (14) ROA (%) 4.2 4.0 5.3 5.6
Net Financing CF 13 5 10 (12) Z-Score (X) 1.5 1.3 1.4 1.5
Currency Adjustments (1) 0 0 0 N. Cash/(Debt)PS (S cts) (49.6) (45.0) (45.7) (34.9)
Chg in Cash (39) 47 17 46 Opg CFPS (S cts) 15.3 18.3 20.5 24.0
Free CFPS (S cts) (14.2) 5.5 1.6 13.6
FY Jun 2Q2012 3Q2012 4Q2012 1Q2013 FY Jun 2011A 2012A 2013F 2014F

Cost of Goods Sold (64) (98) (99) (67) Shipbuilding 216 224 350 487
Gross Profit 13 16 18 22 Shiprepair & other svcs 82 89 90 88
Other Oper. (Exp)/Inc (1) (6) (7) (8) Charter & rental svcs 66 78 85 84
Net Interest (Exp)/Inc (3) (3) (2) (2) Gross Profit (S$ m)
Exceptional Gain/(Loss) 0 0 0 0 Shipbuilding 18 24 42 58
Pre-tax Profit 9 8 9 11 Shiprepair & other svcs 16 14 19 18
Tax (1) 0 (2) (2) Charter & rental svcs 16 19 24 22
Minority Interest (1) 0 0 0
Net Profit 8 8 8 10
EBITDA 21 20 20 22 Gross Profit Margins (%)
Shipbuilding 8.2 10.6 11.9 12.0
Sales Gth (%) (6.9) 47.1 2.8 (23.9) Shiprepair & other svcs 19.7 16.0 20.9 20.5
EBITDA Gth (%) (9.2) (7.0) 3.3 10.2 Charter & rental svcs 23.9 24.2 27.9 26.0
Opg Profit Gth (%) (7.4) (12.3) 9.0 21.3
Net Profit Gth (%) (10.6) 4.8 4.2 18.6
Net Profit Margins (%) 9.8 7.0 7.1 11.0 Shipbuilding order wins 198.7 454.5 250.0 300.0
Fleet utilisation (%) 66.0 67.0 70.2 72.0

Page 44
www.dbsvickers.com

ed: OY / sa: JC

Bloomberg: NCL SP
|
Reuters: NMCG.SI

BUY S$0.265 STI : 3,224.80

Potential Catalyst: Stronger earnings ahead
DBSV vs Consensus: Largely in line with consensus

Analyst
Suvro SARKAR +65 6398 7973
suvro@dbsvickers.com

Price Relative
40
60
80
100
120
0.00
0.10
0.20
0.30
May-11 Nov-11 May-12 Nov-12
Nam Cheong Ltd (LHS) Rel ati ve STI Index (RHS)
Relative Index S$


FY Dec (RM m) 2011A 2012F 2013F 2014F
Turnover 606 885 1,294 1,384
EBITDA 113 152 192 210
Net Profit 93 125 157 172
Net Pft (Pre Ex.) 93 125 157 172
EPS (S cts) 2.0 2.6 3.3 3.6
EPS Pre Ex. (S cts) 2.0 2.6 3.3 3.6
EPS Gth (%) (52) 34 26 9
EPS Gth Pre Ex (%) (52) 34 26 9
Net DPS (S cts) 0.2 0.3 0.3 0.4
BV Per Share (S cts) 10.0 12.4 15.4 18.7
PE (X) 13.5 10.1 8.0 7.3
PE Pre Ex. (X) 13.5 10.1 8.0 7.3
P/Cash Flow (X) 33.7 10.9 nm 9.6
EV/EBITDA (X) 13.8 9.6 8.6 7.4
Net Div Yield (%) 0.7 1.0 1.3 1.4
P/Book Value (X) 2.7 2.2 1.7 1.4
ROAE (%) 20.8 23.5 24.0 21.4


ICB Sector: Construction & Materials
Principal Business: Leading Malaysian builder of offshort support
vessels

At A Glance
Mkt. Cap (S$m/US$m) 510 / 416
Major Shareholders
SK Tiong Enterprise Sdn (%) 30.0
Hung Yung Enterprise Sdn (%) 16.7
Su Kouk Tiong (%) 8.6
Free Float (%) 44.7

Nam Cheong Ltd
On track for strong growth

Secured a record number of vessel sale
contracts in FY12, backed by healthy recurrent
demand for OSVs in Malaysia and overseas

Expectations for robust earnings ahead should
help re-rate stock
Maintain BUY with TP of S$0.30

FY12 has been a record year for vessel sales. With the last
set of three vessels (2 AHTS + 1 PSV) sold in December, FY12
is now a record year for Nam Cheong, with 21 vessels sold
during the year. It has now also sold more than half of its 19
vessel build-to-stock models for FY13, so the crystal ball has
been accurate so far. Its order book was close to the record
level of RM1.5bn in end-2012, and should drive healthy
earnings growth in FY13/14.

Steady industry fundamentals support growth outlook.
We expect more order flows from Petronas-linked projects in
Malaysia in 1H FY13, as activity on the ground picks up steam.
Nam Cheong is the largest builder of OSV vessels for
Malaysian waters, and with Petronas committed to its
offshore capex plans over the next five years in a bid to
increase production levels; Nam Cheong remains in a sweet
spot. Nam Cheong has also extended its geographical reach
to new markets like West Africa, which offer good potential in
for the future.

Look forward to record earnings. We believe Nam
Cheongs FY14 newbuild programme will be larger than in
FY13, in line with the still robust outlook for oil & gas E&P
activities. The S$110m funds raised through its recent
medium-term notes issuance will also help support growth.
We remain comfortable with our projection of close to 30%
earnings CAGR over FY11-13. Maintain BUY with TP of
S$0.30, pegged to 9x FY13 earnings.


Nam Cheong Ltd

Page 45

Income Statement (RM m) Balance Sheet (RM m)

Turnover 606 885 1,294 1,384 Net Fixed Assets 128 128 127 136
Cost of Goods Sold (468) (701) (1,046) (1,116) Invts in Associates & JVs 0 0 0 0
Net Interest (Exp)/Inc (5) (7) (11) (12) Total Assets 961 1,167 1,468 1,643
EBITDA 113 152 192 210 Total Cap. & Liab. 961 1,167 1,468 1,643

Sales Gth (%) (20.0) 45.9 46.3 6.9 Non-Cash Wkg. Capital 646 664 993 1,045
Opg Profit Gth (%) (19.0) 35.7 27.7 9.6
Net Profit Gth (%) (22.0) 34.0 26.1 9.4
Cash Flow Statement (RM m) Rates & Ratio

Assoc. & JV Inc/(loss) (2) 0 0 0 ROAE (%) 20.8 23.5 24.0 21.4
Chg in Wkg.Cap. (52) (29) (332) (53) ROA (%) 9.6 11.7 11.9 11.1
Net Operating CF 37 116 (161) 131 Div Payout Ratio (%) 10.1 10.1 10.1 10.1
Div Paid 0 (13) (16) (17) Quick Ratio (x) 0.2 0.4 0.3 0.5
Chg in Gross Debt (59) (30) 100 0 Net Debt/Equity (X) 0.6 0.4 0.5 0.3
Net Financing CF (55) (43) 84 (17) Z-Score (X) 2.9 3.1 3.1 3.2
Currency Adjustments 2 0 0 0 N. Cash/(Debt)PS (sen) (15.6) (10.7) (20.5) (15.6)
Chg in Cash (22) 64 (87) 94 Opg CFPS (sen) 4.7 7.6 8.9 9.6
Free CFPS (sen) 1.6 5.6 (8.9) 5.8
Quarterly / Interim Income Statement (RM m) Segmental Breakdown / Key Assumptions

Turnover 140 206 150 142 Revenues (RMm)
Cost of Goods Sold (106) (159) (120) (103) Shipbuilding 565 839 1,249 1,336
Gross Profit 33 46 30 39 Chartering 42 46 46 48
Other Oper. (Exp)/Inc (7) (10) (6) (4)
Operating Profit 26 37 24 35 Total 606 885 1,294 1,384
Other Non Opg (Exp)/Inc 0 0 0 0 Gross profit (RMm)
Associates & JV Inc 2 0 0 0 Shipbuilding 105 147 212 230
Net Interest (Exp)/Inc (1) (1) (1) (1) Chartering 33 37 37 38
Pre-tax Profit 26 35 23 34 Total 138 183 249 268
Tax 1 (2) 0 (2) Gross profit Margins (%)
Minority Interest 0 0 0 0 Shipbuilding 18.6 17.5 17.0 17.2
Net Profit 26 33 22 32 Chartering 78.8 80.0 80.0 80.0
EBITDA 29 38 25 38 Total 22.7 20.7 19.2 19.4

Sales Gth (%) (44.5) 47.4 (27.1) (5.3) Key Assumptions
EBITDA Gth (%) (47.5) 31.6 (33.8) 50.9 # AHTS sold 9.0 13.0 5.0 8.0
Opg Profit Gth (%) (52.3) 43.1 (35.2) 47.5 # PSV sold 0.0 4.0 10.0 9.0
Net Profit Gth (%) (43.6) 26.0 (32.4) 40.4 # AWB sold 2.0 1.0 2.0 2.0
Gross Margins (%) 23.7 22.6 19.7 27.3 # Others sold 2.0 0.0 0.0 0.0

Market Focus

Page 46

DBSV recommendations are based an Absolute Total Return* Rating system, defined as follows:
STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame)
BUY (>15% total return over the next 12 months for small caps, >10% for large caps)
HOLD (-10% to +15% total return over the next 12 months for small caps, -10% to +10% for large caps)
FULLY VALUED (negative total return i.e. > -10% over the next 12 months)
SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame)
Share price appreciation + dividends

DBS Vickers Research is available on the following electronic platforms: DBS Vickers (www.dbsvresearch.com); Thomson
(www.thomson.com/financial); Factset (www.factset.com); Reuters (www.rbr.reuters.com); Capital IQ (www.capitaliq.com) and Bloomberg
(DBSR GO). For access, please contact your DBSV salesperson.

GENERAL DISCLOSURE/DISCLAIMER
This report is prepared by DBS Vickers Research (Singapore) Pte Ltd ("DBSVR"), a direct wholly-owned subsidiary of DBS Vickers Securities
(Singapore) Pte Ltd ("DBSVS") and an indirect wholly-owned subsidiary of DBS Vickers Securities Holdings Pte Ltd ("DBSVH"). This report is
intended for clients of DBSV Group only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any
means or (ii) redistributed without the prior written consent of DBSVR. It is being distributed in the United States by DBSV US, which accepts
responsibility for its contents. Any U.S. person receiving this report who wishes to effect transactions in any securities referred to herein should
contact DBS Vickers Securities (USA) Inc (DBSVUSA) directly and not its affiliate.

The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to
DBSVR, DBSVS, and/or DBSVH) do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed
are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document
does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document
is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees, who should obtain
separate independent legal or financial advice. DBSVR accepts no liability whatsoever for any direct, indirect and/or consequential loss
(including any claims for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in
relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. DBSVH is a
wholly-owned subsidiary of DBS Bank Ltd. DBS Bank Ltd along with its affiliates and/or persons associated with any of them may from time to
time have interests in the securities mentioned in this document. DBSVR, DBSVS, DBS Bank Ltd and their associates, their directors, and/or
employees may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking,
investment banking and other banking services for these companies.

Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there
can be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk
assessments. The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or
condensed and it may not contain all material information concerning the company (or companies) referred to in this report.

The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and
assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on
which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from
actual results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO
BE RELIED UPON as a representation and/or warranty by DBSVR, DBSVS and/or DBSVH (and/or any persons associated with the aforesaid
entities), that:

(a) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and
(b) there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk
assessments stated therein.

Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies)
mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to
the commodity referred to in this report.

DBS Vickers Securities (USA) Inc ("DBSVUSA")"), a U.S.-registered broker-dealer, does not have its own investment banking or research
department, nor has it participated in any investment banking transaction as a manager or co-manager in the past twelve months. Any US
persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any
security discussed in this document should contact DBSVUSA exclusively.

ANALYST CERTIFICATION
The research analyst primarily responsible for the content of this research report, in part or in whole, certifies that the views about the
companies and their securities expressed in this report accurately reflect his/her personal views. The analyst also certifies that no part of his/her
Market Focus

Page 47
compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of 7 Jan 2013,
the analyst and his / her spouse and/or relatives who are financially dependent on the analyst, do not hold interests in the securities
recommended in this report (interest includes direct or indirect ownership of securities, directorships and trustee positions).

COMPANY-SPECIFIC / REGULATORY DISCLOSURES
1.
DBS Vickers Securities (Singapore) Pte Ltd and its subsidiaries do not have a proprietary position in the company mentioned as
of 3 Jan 2013

2.
DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBS Vickers Securities (USA) Inc ("DBSVUSA"), a U.S.-registered broker-
dealer, beneficially own a total of 1% or more of any class of common equity securities of the Far East Hospitality Trust,
Perennial China Retail Trust, CDL HT as of 7 Jan 2013.
3. Compensation for investment banking services:

i.
DBSVR, DBSVS, DBS Bank Ltd and/or other affiliates of DBSVUSA have received compensation, within the past 12 months,
and within the next 3 months receive or intends to seek compensation for investment banking services from the
Bumitama Agri, Ezion Holdings, Far East Hospitality Trust, Perennial China Retail Trust, Nam Cheong, Petra Food, Tiger
Airways, Yoma Strategic, China Merchant, Wing Tai.

ii.
DBSVUSA does not have its own investment banking or research department, nor has it participated in any investment
banking transaction as a manager or co-manager in the past twelve months. Any US persons wishing to obtain further
information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed
in this document should contact DBSVUSA exclusively.

RESTRICTIONS ON DISTRIBUTION
General This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident
of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use
would be contrary to law or regulation.

Australia This report is being distributed in Australia by DBSVR and DBSVS, which are exempted from the requirement to hold
an Australian financial services licence under the Corporation Act 2001 [CA] in respect of financial services provided
to the recipients. DBSVR and DBSVS are regulated by the Monetary Authority of Singapore [MAS] under the laws
of Singapore, which differ from Australian laws. Distribution of this report is intended only for wholesale investors
within the meaning of the CA.

Hong Kong This report is being distributed in Hong Kong by DBS Vickers (Hong Kong) Limited which is licensed and regulated by
the Hong Kong Securities and Futures Commission.

Singapore
This report is being distributed in Singapore by DBSVR, which holds a Financial Advisers licence and is regulated by
the MAS. This report may additionally be distributed in Singapore by DBSVS (Company Regn. No. 198600294G),
which is an Exempt Financial Adviser as defined under the Financial Advisers Act. Any research report produced by a
foreign DBS Vickers entity, analyst or affiliate is distributed in Singapore only to Institutional Investors, Expert
Investors or Accredited Investors as defined in the Securities and Futures Act, Chap. 289 of Singapore. Any
distribution of research reports published by a foreign-related corporation of DBSVR/DBSVS to Accredited Investors
is provided pursuant to the approval by MAS of research distribution arrangements under Paragraph 11 of the First
Schedule to the FAA.

United Kingdom This report is being distributed in the UK by DBS Vickers Securities (UK) Ltd, who is an authorised person in the
meaning of the Financial Services and Markets Act and is regulated by The Financial Services Authority. Research
distributed in the UK is intended only for institutional clients.

Dubai/
United Arab
Emirates
This report is being distributed in Dubai/United Arab Emirates by DBS Bank Ltd, Dubai (PO Box 506538, 3
rd
Floor,
Building 3, Gate Precinct, DIFC, Dubai, United Arab Emirates) and is intended only for clients who meet the DFSA
regulatory criteria to be a Professional Client. It should not be relied upon by or distributed to Retail Clients. DBS
Bank Ltd, Dubai is regulated by the Dubai Financial Services Authority.

United States Neither this report nor any copy hereof may be taken or distributed into the United States or to any U.S. person
except in compliance with any applicable U.S. laws and regulations.

Other jurisdictions In any other jurisdictions, except if otherwise restricted by laws or regulations, this report is intended only for
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jurisdictions.

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12 Marina Boulevard, Level 40, Marina Bay Financial Central Tower 3, Singapore 018982
Tel. 65-6327 2288
Company Regn. No. 198600295W


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