Post Reply
1-20 of 70
Up again ! Up again ! Never buy :(
Miss the train again...... Good news for those who vested.....
iOCBC report today.
Rotary Engineering Ltd
Riding the Houdini wind 14 November 2006 Maintain BUY Previous Rating: BUY S$0.665 Fair Value: S$0.88 .Event: Update More contract win. With yesterday's announcement of S$10.3m contract
to provide mechanical, piping and steel structures works, Rotary
Engineering has now secured its second contract from Shell Eastern
Petroleum (Pte) Ltd in less than 3 weeks. Similar to the earlier S$15.5m
contract for modification works at the existing refinery, the latest contract
win is another piecemeal project that was carved out of the much bigger
US$3b Bukom Shell Houdini project (BSH). to provide mechanical, piping and steel structures works, Rotary
Engineering has now secured its second contract from Shell Eastern
Petroleum (Pte) Ltd in less than 3 weeks. Similar to the earlier S$15.5m
contract for modification works at the existing refinery, the latest contract
win is another piecemeal project that was carved out of the much bigger
US$3b Bukom Shell Houdini project (BSH). Award of specialized EPC contracts to gain momentum. While the
size of the awarded contracts are small, we believe that they are harbingers
to more modifications works and additions to the existing refinery that will
characterize the first phase of developments for the BSH. Working on the
initial timeline for the BSH to be completed by 2009/10, we believe that the
dishing out of specialized contracts for engineering, procurement and
construction (EPC) and maintenance services will gain significant
momentum as we progress into 2007; with Rotary as one of the leading
contenders. size of the awarded contracts are small, we believe that they are harbingers
to more modifications works and additions to the existing refinery that will
characterize the first phase of developments for the BSH. Working on the
initial timeline for the BSH to be completed by 2009/10, we believe that the
dishing out of specialized contracts for engineering, procurement and
construction (EPC) and maintenance services will gain significant
momentum as we progress into 2007; with Rotary as one of the leading
contenders. Not forgetting the price catalyst from 2H06 results. As a recap, Rotary's
net profit surged 395% YoY to S$16.0m in 1H06, after having already
delivered a consistent 60% net profit CAGR over the FY03-05 period. We
believe that earnings in 2H06 will be even stronger on a HoH basis, aided
by significantly higher percentage recognition of the huge S$535m EPC
contract from Universal Terminal (S) Pte Ltd. As such, we maintain our
above-market-consensus forecast of a huge 353.5% YoY jump in Rotary's
net profit to S$38.0m in FY06. net profit surged 395% YoY to S$16.0m in 1H06, after having already
delivered a consistent 60% net profit CAGR over the FY03-05 period. We
believe that earnings in 2H06 will be even stronger on a HoH basis, aided
by significantly higher percentage recognition of the huge S$535m EPC
contract from Universal Terminal (S) Pte Ltd. As such, we maintain our
above-market-consensus forecast of a huge 353.5% YoY jump in Rotary's
net profit to S$38.0m in FY06. Significant price upside potential. Rotary recently announced two
capital restructuring exercises to settle its Section 44 tax credit issue,
whereby it: 1) proposes a bonus gross dividend of 10 cents per share, and
2) proposes a concurrent 2-for-5 renounceable non-underwritten rights
issue. While these corporate actions may improve trading liquidity of the
shares, we expect minimal impact on Rotary's business fundamentals.
We continue to have a fair value estimate of S$0.88 for Rotary, based on a
similar 2.2x FY07 P/B ratio. The implied FY06 and FY07 forward PERs
are undemanding, at 7.1x and 8.3x, respectively. The capital gain potential
is 32%. Maintain BUY.
General Data capital restructuring exercises to settle its Section 44 tax credit issue,
whereby it: 1) proposes a bonus gross dividend of 10 cents per share, and
2) proposes a concurrent 2-for-5 renounceable non-underwritten rights
issue. While these corporate actions may improve trading liquidity of the
shares, we expect minimal impact on Rotary's business fundamentals.
We continue to have a fair value estimate of S$0.88 for Rotary, based on a
similar 2.2x FY07 P/B ratio. The implied FY06 and FY07 forward PERs
are undemanding, at 7.1x and 8.3x, respectively. The capital gain potential
is 32%. Maintain BUY.
General Data General Data Issued Capital (m) 406
Mkt Cap (S$m/US$m) 270/173
Major Shareholder Chia Family
(38%)
Free Float (%) 41
NTA per share (S$) 0.29
Daily Vol 3-mth (?000) 2,836
52Wk High (S$) 0.700
52Wk Low (S$) 0.425
wait4opp,
Price up/down or steady depends on market perception of the announcement.
Last week, Allgreen something similiar....the stock price went up as a result.
Veteran,
Thank you for your kind advice.
So will the price goes up, I miss the boat today at the closing.
wait4opp,
Rotary will pay 10cts divident (less20% tac - net 8cts) per share. So, for each lot, you will receive $80.
However, you can opt to use this $80 to pay for your 'rights' shares at 20cts per share.... at 2 rights for 5 shares held. i.e. for each lot you have now, you will be entitled to 400 'rights' shares. ...which will cost $80 (at 20cts per share). If you do this, you will end up with 1400 shares.
If you don't want to exercise your 'rights' you will receive $80.
Hope this is clear.
kong xia mi, wo bu ming bai.......
Anyone can help to explain clearer......Thank you hor....
Rotary Engineering proposes bonus dividend of S$0.10 per ordinary share and two-for-five rights issue at S$0.20 per Rights Share
Shareholders can choose to use the Bonus Dividend to subscribe for Rights Issue Initiatives are intended to reward shareholders and to strengthen capital base
SINGAPORE, 7 November 2006 ? Mainboard-listed Rotary Engineering Limited ("Rotary") today declared a bonus dividend of S$0.10 less tax of 20% per ordinary share, and proposed a renounceable, non-underwritten rights issue on the basis of two Rights Shares for every five shares held. Rotary is a leading provider of engineering, procurement, construction and maintenance services supporting the oil-and-gas and petrochemical industry.
Shareholders may elect to use all or part of their Bonus Dividend to pay for the Rights Shares, and if they use their entire Bonus Dividend for this purpose, no further cash outlay is required for the rights subscription.
Based on Rotary?s current issued ordinary share capital, the aggregate amount of the Bonus Dividend is approximately S$32.4m. Rotary expects the Rights Issue to be well subscribed, such that shareholders? equity will remain largely unaffected by these initiatives.
Rationale for the two exercises Shareholders can choose to use the Bonus Dividend to subscribe for Rights Issue Initiatives are intended to reward shareholders and to strengthen capital base
SINGAPORE, 7 November 2006 ? Mainboard-listed Rotary Engineering Limited ("Rotary") today declared a bonus dividend of S$0.10 less tax of 20% per ordinary share, and proposed a renounceable, non-underwritten rights issue on the basis of two Rights Shares for every five shares held. Rotary is a leading provider of engineering, procurement, construction and maintenance services supporting the oil-and-gas and petrochemical industry.
Shareholders may elect to use all or part of their Bonus Dividend to pay for the Rights Shares, and if they use their entire Bonus Dividend for this purpose, no further cash outlay is required for the rights subscription.
Based on Rotary?s current issued ordinary share capital, the aggregate amount of the Bonus Dividend is approximately S$32.4m. Rotary expects the Rights Issue to be well subscribed, such that shareholders? equity will remain largely unaffected by these initiatives.
Rationale for the two exercises
Shareholders may elect to use all or part of their Bonus Dividend to pay for the Rights Shares, and if they use their entire Bonus Dividend for this purpose, no further cash outlay is required for the rights subscription.
Based on Rotary?s current issued ordinary share capital, the aggregate amount of the Bonus Dividend is approximately S$32.4m. Rotary expects the Rights Issue to be well subscribed, such that shareholders? equity will remain largely unaffected by these initiatives.
Rationale for the two exercises
The Bonus Dividend is intended to reward shareholders with a cash dividend and allow the company to pass on its Section 44 tax credits to shareholders. At the same time, the Bonus Dividend will provide shareholders with an option to re-invest their Bonus Dividend by subscribing for Rights Shares.
The Rights Issue seeks to strengthen the capital base of the company following the payment of the Net Bonus Dividend. Together with the Bonus Dividend, the Rights Issue will in effect transform a portion of the Company?s retained earnings into permanent share capital.
Commenting on the exercise, Mr Chia Kim Piow, Rotary?s Chairman and Managing Director, said: "As a listed company, we are mindful of our obligation to our shareholders and we continually look for ways to create shareholder value. By paying a bonus dividend, we are able to pass on Section 44 tax credits to our shareholders."
Mr Chia is optimistic about market outlook, and is excited about the opportunities that Rotary can enjoy. He added: "Indeed, our enhanced capital position will hold us in good stead as we continue to grow our business in Singapore, the region and as we move into new markets such as the Middle East."
It extended recent gains, rising to a new one-year high, on hopes that it will secure additional contracts from Shell Eastern Petroleum (Pte) Ltd, a unit of Royal Dutch Shell, dealers said.
Last week, Rotary announced that it won job orders worth $15.5 mln for some of the initial works required at Shell's petrochemical project on Pulau Bukom.
Industry sources said Rotary Engineering was seeking other opportunities in the Pulau Bukom project, particularly the storage tanks needed at the complex.
"Shell is awarding the contracts piecemeal to various contractors," a source said, noting that Shell awarded an $80 mln pipe supply contract to SSH Corp and Phoceenne Asia Pte Ltd earlier this week.
shplayer,
thank you for your advise ya, I will go in and grap some to keep then...
Hope to 70 cents I happily liao....Bow Tam Sim.....
wait4opp,
the 'resistance' are very short term, micro observations form the 'buyers/sellers' queue list. At the most it is valid for that trading day.
Based on FA, 70cts is still a 'buy'.....vested and my personnal opinion.
Steady !!
candle got no upper shadow... plus close at 52 weeks high.
Remember, the high will get higher !
When the stock is being picked up and play, there is no resistant.....
65cents small kick for them lah.....the Target will be at 70 cents.