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if u r looking for a growth stock, i sincerely recommend this.
I have unloaded my CG Tech shares. Will buy again.
To recapitulate
Target prices of 98 cents, 1.11 and 1.20 set by
iOCBC, Westcomb and CIMB-GK.
All target prices quoted are PRE-BONUS SHARE.
Date for bonus share and dividends to be announced. The former subjected to shareholders approval (which is just a formality).
$1.20.........................
Market correction provides a very good opportunity to buy into this counter, slowly accumulate n wait patiently for the rebounds, any sharp retracement will follow by a strong rebound very soon. Do not forget the TP of CIMB is
better watch out! China mkt crashed by 9%, that's why today Spore mkt also kaput.
The current market correction offers a good chance to accumulate!
TP $1.11 refers to post or pre bonus & dividend price ???
Westcomb rerated CG Tech -
$1.11
CG tech did very well last year, so did FibreChem,which is giving one bonus share for every existing share,the next good news to announce could be SINOTECHFIB, which is in the same industry.
Gng hit $1 in soon....cheong ah
CIMB tp $1.2
Kenneth Ng, CFA +65 6210-8610 ? kenneth.ng@cimb.com MICA (P) 051/03/2007
? Stellar performance, in line with expectations. Net profit for 4Q06 rose by 69%
yoy to Rmb33m, with full-year net profit growth of 61% exceeding management?s
guidance of 50% but in line with our expectations and market consensus. A 52%
yoy surge in full-year topline was largely driven by the group?s expansion
throughout the year, which boosted production capacity from 36,205 tonnes p.a. in
FY05 to 48,155 tonnes by the end of FY06.
? Improved margins through expansion into higher-value products. Overall
gross profit margin improved qoq from 26% to 28% in 4Q06, due to increased
capacity for high-margin alkali-soluble PET chips, contributions from its premiumgrade
combed yarn products and lower COGS of 13% due to a softening of crude
oil prices.
? Earnings can be further boosted if CG Tech can penetrate international
market. CG Tech is likely to embark on several initiatives to build its brand
awareness. The group plans to open up a marketing office in Hong Kong to gain
exposure to the international market and is in talks with fashion designers for
possible tie-ups. If these initiatives prove successful, we believe that blended
gross margins can exceed 30% from the 25% currently.
? Proposed bonus issue. The group has proposed a 1-for-2 bonus issue for FY06.
In addition, cash dividend payout for FY06 was 22%, translating into a yield of
1.9%.
? Maintain Outperform with target price unchanged. We maintain our earnings
estimates and target price of S$1.20 (theoretical post-bonus issue price of
S$0.80), still based on DCF valuation (WACC 12.41%, terminal growth rate 0.5%)
We have also introduced FY09 numbers. At 7x CY07 P/E and 5.3x CY08 P/E, the
stock remains the cheapest among its Singapore-listed fibre peers. Maintain
Outperform.
iOCBC Research Target Price 98 cents
CG Technologies: Better than guidance, as expected
Summary: CG Technologies (CGT) previously guided for a 50% YoY growth in net profit, but as expected, it outperformed its own guidance with growth standing at 61.2%, bringing net profit to RMB134.8m. This was on the back of a 52.1% increase in revenue to RMB707m. The strong growth was due to an increase in the production capacity for products as such bright and semi dull PET chip, alkali soluble PET chip and yarn products. Introduction of new products such as high shrinkage PET chip and combed yarn also fuelled growth. Despite fluctuations in oil prices, CGT achieved better margins mainly due to the introduction of the new products which yielded higher margins than most of the existing products. Gross profit margin (GPM) increased from 25% to 26% in FY06. GPM was the strongest in 4Q06 at 27.5% compared to 24.9% in 3Q06 and 25.7% in 4Q05. Prospects for FY07 remain promising and CGT is well on its way to launch polyester short fibre by 3Q07 which will help to maintain its high margins since CGT has to currently procure PSF for use as raw materials for its various products. Management has proposed a final dividend of 1.5 Singapore cents per share and a 1-for-2 bonus share issue. The bonus share issue could potentially cause a 33% decrease in our EPS estimates, but we have yet to factor this in our earnings forecast. CGT share price has performed very well, rising 32% since our initiation two weeks ago. We continue to like CGT and believe in the strategies and plans it has in place for the next few years. . In terms of valuation, we will continue to use a price earning ratio (PER) of 7.5x for FY07/08 (previously only FY07) to capture the growth in FY08 as well. This translates into a fair value of S$0.98 (previously S$0.89) and we maintain our BUY rating.
Buy before they raise theTP, or you will miss the train.
shall wait for today closing to decide to buy or not :)
CG tech opened at 84 cts, up 6cts this morning , it is trading around 82 cts now,this is well above its upper trend channel,which has just broken out of the previous trend channel.The price will move up to 99 cts in a short while after the readjusting of the TP from the brokering firm.
Expectations for CG Tech is really high. I hope their financial results turn out good. If not, it will be a repeat of Longcheer and a field day for shortists.
Not vested, just an opinion.
CIMB-GK maintains Target Price at 1.20
OPENING PRICE
84 cents UP 6 cents
SOURCE: iOCBC
CG Technologies: Better than guidance, as expected
Summary: CG Technologies (CGT) previously guided for a 50% YoY growth in net profit, but as expected, it outperformed its own guidance with growth standing at 61.2%, bringing net profit to RMB134.8m. This was on the back of a 52.1% increase in revenue to RMB707m. The strong growth was due to an increase in the production capacity for products as such bright and semi dull PET chip, alkali soluble PET chip and yarn products. Introduction of new products such as high shrinkage PET chip and combed yarn also fuelled growth. Despite fluctuations in oil prices, CGT achieved better margins mainly due to the introduction of the new products which yielded higher margins than most of the existing products. Gross profit margin (GPM) increased from 25% to 26% in FY06. GPM was the strongest in 4Q06 at 27.5% compared to 24.9% in 3Q06 and 25.7% in 4Q05. Prospects for FY07 remain promising and CGT is well on its way to launch polyester short fibre by 3Q07 which will help to maintain its high margins since CGT has to currently procure PSF for use as raw materials for its various products. Management has proposed a bonus issue of 1-for-2 which will potentially cause a dilution of 50%. CGT share price has performed very well, rising 32% since our initiation two weeks ago. Meanwhile, our BUY rating and fair value are currently under review pending an analysts' briefing later this morning.
No it isn't. The target price set by broking firms will exceed $1.20 (highest so far from all the three firms covering).
The market will respond by reaching 89 cents in the short term (the lowest target price).
Between 89 and 78 cents now, there is > 10% gain. And truly, this is being very conservative.
Thereafter, the stock will fall slightly because of technical correction (after all Dow is in negative territory for 3 days already).
My personal opinion - not an inducement to buy.