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What? i thot u want to chow at 20cts, no? kekeke..
Share7 ( Date: 16-Sep-2013 22:13) Posted:
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Wow, we zoom in on the same item. Either we are great minds think alike but fools seldom differs too. Hopefully former rather than later.:)
Lucky03 ( Date: 16-Sep-2013 22:11) Posted:
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Hitting RMB1B is a matter of time. What excites me is guaranteed profit, high RMB2B guaranteed revenue to be recovered through monthly payments (read Maybank Kim Eng report). The more BOT/TOT, revenue is like mortgage payment but guaranteed by municipal govt. Then there is EPC and higher water tariff. I move my target price higher already. Wait until FY15.
leeeta ( Date: 16-Sep-2013 22:07) Posted:
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2 points are of particular interest for financial risk assessment which we know that led to the trouble of Biotreat days :
- As at end of FY6/13, Hankore has nearly RMB2b non-current financial receivables vs total assets of RMB2.7b. In some sense, high financial receivables guarantees future revenue and provide good earnings visibility.
- Credit risk: Water companies usually deal with local governments. Given the high gearing and slowdown in China economy, governments of certain areas could face financial difficulties in the future, which could result in default risk for water companies. But in our opinion most of Hankore?s plants are located in coastal areas which are supposed to be financially healthier.
- As at end of FY6/13, Hankore has nearly RMB2b non-current financial receivables vs total assets of RMB2.7b. In some sense, high financial receivables guarantees future revenue and provide good earnings visibility.
- Credit risk: Water companies usually deal with local governments. Given the high gearing and slowdown in China economy, governments of certain areas could face financial difficulties in the future, which could result in default risk for water companies. But in our opinion most of Hankore?s plants are located in coastal areas which are supposed to be financially healthier.
leeeta ( Date: 16-Sep-2013 21:42) Posted:
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good chance for HK to hit 1Bio rmb revenue for FY2014. Woot !!!!
Share7 ( Date: 16-Sep-2013 21:47) Posted:
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Nextinsght did another short article on Maybank Kim Eng's report. Here's the link with their earlier report nicely displayed. Followship will increase. If you hold HK, it's good time to hold tight and enjoy the ride.
http://www.nextinsight.net/index.php/story-archive-mainmenu-60/919-2013/7390-hankore-yangzijiang-get-singled-out-in-respective-industries
Growth driver going forward. In our opinion, Hankore has a very
good earnings visibility. We identified three main growth drivers for the
company:
(1) EPC revenue support near term growth. Hankore?s EPC revenue
has increased from RMB25.6m in FY6/11 to RMB168.5m in FY6/13. In
our view, EPC revenue could improve even more in FY6/14.
Company?s CAPEX guidance and the project delivery schedule could
serve as good indication to EPC revenue. Company guides a total
RMB750m CAPEX in water plant expansion and upgrading in FY13/14.
In FY13, Hankore has spent RMB160m and booked RMB168.5m EPC
revenue. If the remaining expansion and upgrading works can be
delivered on time, it means around RMB590m expansion CAPEX in
FY6/14. A back-of-the-envelope estimation suggests that EPC
contribution in FY6/14 could even triple from current level. This will
support the profit growth next year.
(2) Capacity expansion fuels growth for FY15 onwards. The ongoing
expansion works will increase the water processing capacity by around
33% from current level when most of them are completed in the next
twelve months. Given the fact that all the water plants enjoy the 100%
capacity uptake guarantee from the government, the capacity
expansion will surely translate into revenue improvements going
forward.
(3) Water tariff hike. The upgrading program will improve Hankore?s
water output quality, which can give the company more room to
negotiate with government to raise water tariff. For example, the Liuhe
plant will enjoy a 58% tariff hike after phase II upgrading is finished in
Sep 2013 (as shown in Figure 1). This will result in a margin
improvement going forward.
leeeta ( Date: 16-Sep-2013 21:36) Posted:
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Do remember that the BBs tend to distribute during the euphoria stage, which is not far from now. They collect when the whole world is pissed off and selling (not too long ago) and distribute when everyone is buying and chasing the price. But in the meantime, lets enjoy the ride up.
The price action on Wednesday, not tomorrow, will demonstrate the resolve of the market maker in pushing up the price to par levels with other water treatment companies. Otherwise, we will see 5cents plus again and i will start to collect once more :)
Mr Wang is not the only operator any longer. The keeper has changed after successfully defending the 5cent trench. Now, new ones protect the 6cent fort. Sweet~
The price action on Wednesday, not tomorrow, will demonstrate the resolve of the market maker in pushing up the price to par levels with other water treatment companies. Otherwise, we will see 5cents plus again and i will start to collect once more :)
Mr Wang is not the only operator any longer. The keeper has changed after successfully defending the 5cent trench. Now, new ones protect the 6cent fort. Sweet~
this is the full report.
http://research.maybank-ib.com/pdf/document/Hankore_unrated_160913_5033.pdf
leeeta ( Date: 16-Sep-2013 21:34) Posted:
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3 short pages but powerful..no shorts from Kim Eng ..hahaha.
Share7 ( Date: 16-Sep-2013 21:19) Posted:
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leeeta, the full report is quite short (3 pages with stats) worth reading. Go to the link below. Now we have OCBC, UOBKayHian and MayBank Kim Eng all have issued reports on HK but no ratings. Soon the reports will be rewritten/updated and rated....then see how high it will go. Focus is on 2nd half FY14 and FY15.
leeeta ( Date: 16-Sep-2013 21:12) Posted:
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No wonder these few days they never short liao. hahaha.
Another brief report on Hankore on Singapore Daily by Maybank Kim Eng. Hankore tongers huat ahh!!!
HanKore Environment: Cheaper Exposure to China Water Sector
BIOT SP | Mkt Cap USD209m| ADTV USD3.7m
We recently met with Hankore?s management and visited one of its water plants in Suzhou. We are impressed by the
restructuring and progress that occurred in the past few years and think there are some improvements in company?s
fundamental.
We identified three main growth drivers for the company: EPC revenue, capacity expansion and water tariff hike.
Despite the risk such as interest rate risk, liquidity risk and credit risk, valuation seems attractive compared to peers at
only 8.2x 12m trailing PER.
You can read full report at http://www.remisiers.org/cms_images/research/Sep16-Sep20_2013/0916_MaybKE_SG_Daily.pdf
Click here for full report weibin@maybank-ke.com.sg
hahaha..stick to your target la.. dont want to hai u. :)
Share7 ( Date: 16-Sep-2013 20:57) Posted:
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good opportunity to jeep somemore. :)
Polarbear55 ( Date: 16-Sep-2013 20:54) Posted:
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I believe. My target is moving higher infected by lucky and your optimism. Tomorrow should be another nice white candle...hopefully long long candle. Kateks at 5.6/5.8c jialat.
leeeta ( Date: 16-Sep-2013 20:51) Posted:
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if got 10c, i am quite surprise!! cant wait to see it
Hate to say this, but for TA to be really 'checked' ...$0.057 - $0.058 but be revisited at least one more time. Hope it's a brief stop over and then Cheong towards $0.07! 😊
Share7, this Tortoise can also turn into ninja turtle you know? :)
Share7 ( Date: 16-Sep-2013 20:48) Posted:
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Guys focus on NAV first, then 10c. Tortoise takes step by step. FA checked. TA checked. BBs checked. HK cheong ah!!!
leeeta ( Date: 16-Sep-2013 20:42) Posted:
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