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HSBC initiates on Goodpack with a NEUTRAL rating and $2.15 TP, based on a DCF valuation. Goodpack owns the world?s largest fleet of steel intermediate bulk containers (IBCs) it has 2.9m units in total. IBCs are an environmentally friendly alternative to disposable packaging, such as wood pallets, paper cartons and single-use steel drums. Goodpack?s global network ? spanning over 70 countries and more than 5,000 locations ? gives it a strong competitive advantage. Long-term cost advantages, high exit barriers and a focus on core markets further strengthen the company?s competitive edge in the transport packaging industry. Goodpack?s share price is strongly correlated with world trade volumes and rubber consumption trends, which explains why it de-rated in 2011 when global rubber demand was depressed. The stock has rallied recently on the back of the modest recovery in rubber consumption levels. However, as it is trading close to a 12-month high of SGD1.95 and at a 17.9x 2014e PE, a c19% premium to its five-year historical mean, we believe the recent rerating has largely priced in the growth recovery and there is limited upside to the stock.
Is $1.92 now...will it touch beyond $ 2???
So powerful!!!Guess heading towards $1.9
Strong and steady...
FY13 results were in-line with expectations. Revenue grew by a smaller 7.7% y/y to US$190.9m while net profit improved 13.4% y/y to US$51.3m as its cost saving initiatives helped to offset higher depreciation and financing costs from a larger fleet and increased borrowings respectively. Similar to last year (FY12), management declared a final dividend of 2 S cents and a special dividend of 3 S cents. OCBC lower revenue forecasts for FY14, but still expect growth improvement following the commencement of key clients? synthetic rubber (SR) operations in Singapore and a new SR contract in Russia. In terms of margins, only expect a small drop-off as continued cost saving initiatives should keep a lid on logistic and handling expenses. In light of its unchanged fundamentals and recent share price correction, house maintain BUY on Goodpack with a slightly lower fair value of $1.69.
4QFY13 looks set to beat the sluggish 3QFY13, with the recovery of synthetic rubber demand. Goodpack is in discussions with a large European car manufacturer over a huge auto parts contract. However, the positive impact of the contract win is only likely to be in the long term.
We raise FY13 EPS by 2% to adjust for better-than-expected 4QFY13 results, but cut FY14-15 EPS to reflect higher-than-expected finance costs and operating expenses. We maintain our Outperform rating, with a target price of S$1.80, based on 14.9x CY14 P/E (5% discount to historical mean). The catalysts for the stock are the recovery of synthetic rubber demand and expansion of the auto parts business.
...Last Done: $1.515...
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OCBC upgrades Goodpack to Buy $1.80 fair value
OCBC upgrades Goodpack to Buy with an unchanged fair value estimate of $1.80 as it expects the company to benefit from the official opening of Lanxess's synthetic rubber plant in Singapore.
" We expect production to commence in 1QFY14, and Goodpack will be able to benefit correspondingly given the additional IBCs that it had procured earlier," the house says.
OCBC notes that the plant will only reach full capacity utilization by 2015, " so that means Goodpack will be able to enjoy incremental earnings until the plant reaches a steady state of production."
The stock fell as much as 4.4% since the aftermath of its 3Q13 results release the house believes this price correction presents an opportunity for investors to gain exposure to an important player in the IBC market, and indirect beneficiary of the growing middle class in China and India.
...last Done: $1.665...
What happen to this one????Fall like a rock...
Wah lau kena stuck
Looks not bad...tikam abit.