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CWT Ltd (CWT SP, $1.25, BUY, TP $1.90) – Is a Noble in the making? CWT has signalled its intention to venture into commodity trading. Our latest discussions with management indicate that there is massive potential in this business, given the company’s experience in logistics. We now see a potential multi-bagger at an early stage of growth. We raise our SOTP-based target price to $1.90, implying 52% upside. Reiterate BUY.
MEDIA RELEASE
CWT Subsidiary Licensed As A
U.S. Futures Commission Merchant
Singapore, 21 March 2011 — CWT Limited (“CWT” or the “Group”), a leading provider of integrated
logistics solutions, today announced that its subsidiary, Straits Financial LLC has been granted its Futures
Commission Merchant (FCM) registration and membership approval by the National Futures Association
(NFA). Straits has also been granted full clearing status by both the Chicago Mercantile Exchange (CME)
and the Chicago Board of Trade (CBOT).
CWT Group CEO Loi Pok Yen is elated with the Straits team effort in obtaining all necessary
authorizations so quickly. Straits Financial LLC can now be an entry point for the Group’s foray into
providing financial services to participants in the global derivatives market. “Straits is a logical extension of
CWT’s logistics and commodity businesses and will be an added benefit to our customers.”
Joseph Mazurek, President of Straits Financial adds that Straits is in a unique position within the FCM
community. “It is a new FCM with strong strategic global partnerships and the ability to combine the
capabilities of providing trading access to the global derivatives market and integrated logistics solution
under one umbrella. Whether you are an institution, retail investor, speculator or hedger, as long as you
trade futures and derivatives, Straits should be your preferred choice for an FCM.”
Straits Financial Chief Operating Officer Paul Fry is also excited that the regulatory approvals are now in
place. “The Straits team can now turn their attention to on-boarding and servicing customer accounts and
building client relationships.”
Now that Straits Financial LLC is established, the Group plans to establish offices in other locations,
primarily throughout Asia.
Yes, yesterday S$1.13, now S$1.2 ! Well done.
Can buy some now :-
CIMB Squawk Box
Quality names to add to your portfolio, position for the rebound
• STI rebounds, time to take long positions… The STI rebounded (+0.2%) this morning
after falling for the last 5 consecutive trading days, in line with our technical views
(TraderAM: Prices could still nudge a tad lower, but we think prices are ready to
rebound). We view the sharp sell down in the past 2 days as a knee-jerk reaction, and
believe that the market could stage an equally rapid rebound. In light of this, we
recommend investors to start accumulating quality names for their portfolio to ride on the
potential rebound.
• What history tells us…Themes are useful but an appreciation of valuations and right
stock picks are still the essence of portfolio performance! Previous event-driven
selldowns (Kobe earthquake, 911, SARS) have proven to be short and sharp, but
recoveries had been equally rapid. While we would wait a few days for the selling
momentum to subside, we believe it is high time to identify quality stocks and ideal entry
valuations. We highlight our analysts’ appraisal of ‘quality’ stocks in our coverage
universe, plus ideal trough valuations for bargain-hunting.
• What to BUY? Taking a leaf from our Singapore Strategy piece this morning, the top
three stocks we look to BUY are Keppel Corp (theme of higher oil prices), OCBC
(wealth management flows into Singapore) and Genting Singapore (alternate travel
demand flows). Other quality names we would look to add in this market weakness are
SembMarine, ARA Asset Management, CDL-HT, City Dev, F& N, FCT, MIT, PLife
REIT, Wing Tai and CWT.
• Are we on the right track? Taking a look at stock price performances of our top 3 picks
relative to the STI this morning, we are convinced that our calls are on the right track.
Among the list of stocks, our top 3 picks gained +0.3% on average, while the STI added
+0.2%.
More growth plans underway
4Q10 and FY10 results came in within our expectations We remain positive over CWT’s long term prospects with its recent business development initiatives and Singapore’s strong economic recovery. We are leaving our FY11 earnings estimates untouched for now. Maintain BUY and TP at S$1.45, based on 20.8x FY11 earnings (a 20% discount to global peers’ 7-year historical average).
4Q10 and FY10 results in-line with expectations. CWT’s 4Q10 revenue jumped 22.6% YoY to S$204.7m, but earnings fell 25.6% YoY to S$7.4m on the back of higher expenses and start-up costs for its Europe operations. 4Q10’s YoY growth in revenue was attributable to higher business volumes for Freight Logistics, new customers, growth in warehousing services, container logistics and engineering services.
2.5 S¢ final dividend declared. CWT is rewarding its shareholders with a final dividend of 2.5 S¢. This brings total dividend declared in FY10 to 8.5 S¢, which represents a payout ratio of 28% and is equivalent to an attractive yield of 7.1%.
Formidable war chest for expansion. CWT is in a strong net cash position (equivalent to S$0.31 per share), with a cash balance of S$202.9m. This puts it in a strong position to push forward with its growth plans. CWT has announced that it is in the midst of acquiring an African freight forwarding business based in South Africa. We believe this acquisition would beef up CWT’s operating capabilities in South Africa and facilitate trade flows between Africa and China, India the Middle East and Europe.One other recent business development for CWT is the establishment of an office in Ulaanbaatar to facilitate domestic distribution of commodities and develop commodity flows of raw materials from Mongolia to China.
Strong growth prospects. With demand for logistics facilities likely to continue growing in view of its link to economic and trade growth, a strong macro outlook prevails. Coupled with the various business development initiatives spearheaded by CWT, we remain positive on the company.
4Q10 and FY10 results came in within our expectations We remain positive over CWT’s long term prospects with its recent business development initiatives and Singapore’s strong economic recovery. We are leaving our FY11 earnings estimates untouched for now. Maintain BUY and TP at S$1.45, based on 20.8x FY11 earnings (a 20% discount to global peers’ 7-year historical average).
4Q10 and FY10 results in-line with expectations. CWT’s 4Q10 revenue jumped 22.6% YoY to S$204.7m, but earnings fell 25.6% YoY to S$7.4m on the back of higher expenses and start-up costs for its Europe operations. 4Q10’s YoY growth in revenue was attributable to higher business volumes for Freight Logistics, new customers, growth in warehousing services, container logistics and engineering services.
2.5 S¢ final dividend declared. CWT is rewarding its shareholders with a final dividend of 2.5 S¢. This brings total dividend declared in FY10 to 8.5 S¢, which represents a payout ratio of 28% and is equivalent to an attractive yield of 7.1%.
Formidable war chest for expansion. CWT is in a strong net cash position (equivalent to S$0.31 per share), with a cash balance of S$202.9m. This puts it in a strong position to push forward with its growth plans. CWT has announced that it is in the midst of acquiring an African freight forwarding business based in South Africa. We believe this acquisition would beef up CWT’s operating capabilities in South Africa and facilitate trade flows between Africa and China, India the Middle East and Europe.One other recent business development for CWT is the establishment of an office in Ulaanbaatar to facilitate domestic distribution of commodities and develop commodity flows of raw materials from Mongolia to China.
Strong growth prospects. With demand for logistics facilities likely to continue growing in view of its link to economic and trade growth, a strong macro outlook prevails. Coupled with the various business development initiatives spearheaded by CWT, we remain positive on the company.
Beri Sori, my mistake, type 1 more zero ! Good Luck.
knightrider ( Date: 24-Feb-2011 16:29) Posted:
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Hello... it is 2.5 cents per share or $0.025 or a yield of about 2.1% interest. Much better than the Bank. Not forgetting this is not the total dividend for the whole year ... so the yield should be much higher. Normally for CWT it is between 8-12%
warrenbegger ( Date: 24-Feb-2011 22:52) Posted:
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Ha ha ha! Love u man!
knightrider ( Date: 24-Feb-2011 16:29) Posted:
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wow lau, oredi so siong and you still reduce the cd to $0.0025 that is not even 1 cent. please take out 1 zero after decimal lah
knightrider ( Date: 24-Feb-2011 16:29) Posted:
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Wa, gives Cd, DVD or pornography video also cannot withstand the counter dropping !!! Cd of S$0.0025 !!!
Na Bei, drop and drop ! S$1.19 liao !!!
STI lao sai liao, now 2995 !!!
CWT Reports Fiscal Year-End 2010 Results
• Record fiscal year revenue of S$747.2 million
• Record fiscal year net income of S$179 million
• Recommends final dividend of 2.5 Singapore cents per share
Singapore, 24 February 2011 – CWT Limited (“CWT” or the “Group”), a leading provider of integrated
logistics solutions, today reported financial results for the year ended December 31, 2010 of revenue of
S$747.2 million, gross margin of 13.3%, net income of S$179 million and earnings per share of 30.39
Singapore cents. The financial results for the fiscal year ended December 31, 2010 include a one-time
exceptional gain of S$147.6 million from the sale and leaseback of CWT Commodity Hub and CWT Cold
Hub administrative expenses of S$66.7 million due mainly to start-up costs incurred for the expanded
operations in Europe and business development expenses finance income of S$7.4 million which
comprise mainly dividends received from and gain on disposal of available-for-sale financial assets and
finance costs of S$5.1 million which include foreign exchanges losses arising from the depreciation of the
USD and Euro against the SGD.
Buy some at S$1.21 to average !
The counter is still dropping. Good luck. 
knightrider ( Date: 22-Feb-2011 16:00) Posted:
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Buy another batch at S$1.22 !
Good Luck men !!
good buy... Knightrider...... me too jump into 1.24
Now is not good time to unload, market haven't crashed. Good Luck.
Nimble here and there, just like LNY and get bloated. Waiting to unload. 
knightrider ( Date: 22-Feb-2011 11:52) Posted:
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