by winston » Wed Aug 10, 2011 7:26 pm
Not vested
Lian Beng (BUY, TP S$0.715).
Main contractor Lian Beng no longer rides on the booms and bust of construction sector. 4QFY11 earnings were in-line with our estimates, coming in at S$11.6m, up 73.8% YoY, on the back of strong construction demand.
FY11 was a record year, with earnings hitting S$48.2m, well within our expectations of S$47.6m. LBG is set to ride on Singapore's current building boom, from both public and private projects and its ventures in private residential and industrial developments will help boost its bottom line.
As at May 2011, LBG has a healthy order book of S$839m (up from S$661m in Feb 11). The contracts will run till FY14, lending some visibility to its earnings.
LBG’s cash hoard, which stands at S$149.9m, will allow it to grow its property development business. On the back of strong construction demand and LBG’s strong track record of project wins (it secured two projects worth S$279.5m in Jun 11), we estimate LBG’s FY12 earnings to come in at S$54.1m, which suggests a prospective P/E of just 3.3x.
Our TP of S$0.715 is pegged to sector average of 7x prospective P/E.
Source: DMG
It's all about "how much you made when you were right" & "how little you lost when you were wrong"