CWT

(26-03-2014, 01:59 PM)kayhian Wrote: seriously undervalued.

BUY!!!!

Now I just have to enjoy the ride up

(30-03-2014, 02:20 PM)kayhian Wrote:

(26-03-2014, 01:59 PM)kayhian Wrote: seriously undervalued.

BUY!!!!

Now I just have to enjoy the ride up

Congrats. But please post a more meaningful comments.
Not meaningless one liner about cheong, enjoy the ride up, undervalue, etc without the underlying facts.
The Moderator has told you before. Isn't it ?
Thanks.

Singapore Wine Vault's $200m facility slated to launch in 3Q

It can house over 10 million bottles.

Singapore’s wine industry will be extra sweeter this year as Singapore’s Wine Vault opens. The $200 million facility, which is set to be the biggest of its kind in Southeast Asia, measures 750,000 sq ft and is capable of housing over 10 million bottles.

The facility is slated to be unveiled in Q3, slightly behind from it’s the previously scheduled opening in Q2. This will allow the management to enhance the preparations for the launch.

Singapore Wine Vault is a wholly owned subsidiary of CWT Logistics, which is part of the CWT Group.

According to Loi Yan Yi, director for marketing at CWT Limited, “Q2 was an indication based on last year's projection when we participated in the Wine & Spirits fair in Hong Kong. The building will be completed by Q2 but we want to give time to run in the facility.”

The six-storey Singapore Wine Vault also comprises a main chamber and a separate area – named Drôme – devoted to private wine cellars. Each individual cellar can be customised to the client’s requirements, from installing 24-hour security cameras to storage layout.

Cellars can also be accessed from a virtual cellar account, which allows wine stock to be remotely monitored and provides a platform for easy payments.

To support the growing wine industry in Singapore, CWT Limited plans to hold regular wine events. “It will include wine education, networking amongst wine collectors and sommeliers, wine dinners for the food and wine lovers, which can be a great platform for like minded wine lovers from the wholesale and private collectors to mingle,” said Loi Yan.

Source: Singapore Business Review-4 Mar, 2014

the sell side reports are so boring, their arguments are always the same

multi-year, multi-layer structural growth story -> somehow this phrase sounds very annoying
consolidation and synergy will improve margin -> basic economics, we understand, but it's easier said than done
higher volume for commodity trading -> based on what assumption? commodity trend up again? Chinese start buying again?
SG warehouses are valued at over SGD 800 mln -> are you sure no correction in warehouse price? from what i know incoming supply is huge and warehouse price in SG has skyrocketed a lot since 2008 crises

also they didn't discuss about labor shortage in SG, manufacturing slow down, prospect of warehouse rent and price, and outlook on global trade which is probably still lacklustering...

what do fellow buddies think?

also their tax rate seems to be very low,

footnote 37 from AR 2013:
"Certain tax returns of the Group entities (including the Company) for prior years have not yet been finalised with the
respective tax authorities" -> so in arriving at current tax expense they estimated based on past experience...

"the gains on disposal of leasehold buildings are not subject to tax" -> because they treat it as capital transactions, is this a common practice in SG?

how's the governance in CWT? I read from first page of this thread that they refused to disclose their top 5 executives and their respective salaries?

CWT adopts an integrated business approach with Logistics at the core.

I like their strategy as a growth stock.

On the defensive side, CWT got Logistics.

On the growth side, CWT got Commodity Marketing and Warehouse Properties.

Happily vested

Browsing though the CWT AR 2013, noticed one of the executives has salary of S$7.25 million and prior to the acquisition of MRI in AR 2010, the same executive has salary of S$3 million and that is > 100% increased in salary. I'm suspecting the executive is none other than CEO Loi Pok Yen.

For the past few years, the AGM has been conducted in Tanjong Perjuru at 5 pm which is pretty inaccessible but lucky the company did provide bus service for investors who are keen in attending the AGM. The AGM for this year is scheduled on 38 Tanjong Penjuru, CWT logistics Hub 1 on 23 April 2014 at 5 pm. Is dinner provided by the company?

Churning On Commodities
VALUATION

CWT is currently trading at a 2014F PE of 8.1x based on Bloomberg consensus
EPS estimate of 18.4 S cents. This is
in comparison to its 3-year and 5-year
historical average PEs of 10x and 9x respectively. Forecasted dividend yields are in
the range of 1.7-2.4% for 2014-16.

Net profit for 2014 is projected to grow 4.9% yoy to S$111.2m, based on consensus
estimates. The 3-year (2013-16F) projected CAGR is 7.2%.

Consensus 12-month target price of S$1.69 translates to a potential upside of 14.2%
from the current level.
INVESTMENT HIGHLIGHTS

Nailing down its commodity trading business,
which mainly focuses on dealing
copper and naphtha. While the industry is volatile and seasonal in nature, we think
management has been prudent in its risk management thus far. Counterparty risk is
mitigated as clients are mostly state-owned companies and global firms. Volume is
expected to be maintained at current levels, or slightly higher, to avoid being too
aggressive and speculative. Exposure to certain commodities such as agriculure
and steel-related, which are extremely cyclical, are kept to a minimum if not
completely avoided.

Steady S$20m-25m annual earnings contribution in the near term
is within
management’s expectations for the commodity trading segment. While this will be
unevenly recognised on a quarterly basis, the full-year estimate still accounts for
about 19-24% of the group’s net profit (based on 2013) and provides some visibility
going forward. In our view, the potential upside to this range could come from better
margins and higher volume for naphtha, where the optimal niche market stake is in
the range of 10-15% vs CWT’s current 8-10% control.

Financial services – next phase to conquer
as the group continues to create
synergies from its strength in logistics and commodities. CWT’s presence in financial
services is through its brokering subsidiary Straits Financial Group, and trade
solutions associate Westford Trade Services. In 2013, this division only contributed
1% to group revenue. We see the potential for CWT to leverage on its supply chain
management solutions for commodities to expand its scope of brokering services to
commodity-related firms in Asia. With a conservatively moderate growth outlook on
the other divisions, we think it is possible that management will look to derive its
upside in the medium to long term from this division.

Can state from which house coverage?

(21-04-2014, 10:36 AM)kayhian Wrote: Churning On Commodities
VALUATION

CWT is currently trading at a 2014F PE of 8.1x based on Bloomberg consensus
EPS estimate of 18.4 S cents. This is
in comparison to its 3-year and 5-year
historical average PEs of 10x and 9x respectively. Forecasted dividend yields are in
the range of 1.7-2.4% for 2014-16.

Net profit for 2014 is projected to grow 4.9% yoy to S$111.2m, based on consensus
estimates. The 3-year (2013-16F) projected CAGR is 7.2%.

Consensus 12-month target price of S$1.69 translates to a potential upside of 14.2%
from the current level.
INVESTMENT HIGHLIGHTS

Nailing down its commodity trading business,
which mainly focuses on dealing
copper and naphtha. While the industry is volatile and seasonal in nature, we think
management has been prudent in its risk management thus far. Counterparty risk is
mitigated as clients are mostly state-owned companies and global firms. Volume is
expected to be maintained at current levels, or slightly higher, to avoid being too
aggressive and speculative. Exposure to certain commodities such as agriculure
and steel-related, which are extremely cyclical, are kept to a minimum if not
completely avoided.

Steady S$20m-25m annual earnings contribution in the near term
is within
management’s expectations for the commodity trading segment. While this will be
unevenly recognised on a quarterly basis, the full-year estimate still accounts for
about 19-24% of the group’s net profit (based on 2013) and provides some visibility
going forward. In our view, the potential upside to this range could come from better
margins and higher volume for naphtha, where the optimal niche market stake is in
the range of 10-15% vs CWT’s current 8-10% control.

Financial services – next phase to conquer
as the group continues to create
synergies from its strength in logistics and commodities. CWT’s presence in financial
services is through its brokering subsidiary Straits Financial Group, and trade
solutions associate Westford Trade Services. In 2013, this division only contributed
1% to group revenue. We see the potential for CWT to leverage on its supply chain
management solutions for commodities to expand its scope of brokering services to
commodity-related firms in Asia. With a conservatively moderate growth outlook on
the other divisions, we think it is possible that management will look to derive its
upside in the medium to long term from this division.

(21-04-2014, 10:46 AM)greengiraffe Wrote: Can state from which house coverage?

(21-04-2014, 10:36 AM)kayhian Wrote: Churning On Commodities
VALUATION

CWT is currently trading at a 2014F PE of 8.1x based on Bloomberg consensus
EPS estimate of 18.4 S cents. This is
in comparison to its 3-year and 5-year
historical average PEs of 10x and 9x respectively. Forecasted dividend yields are in
the range of 1.7-2.4% for 2014-16.

Net profit for 2014 is projected to grow 4.9% yoy to S$111.2m, based on consensus
estimates. The 3-year (2013-16F) projected CAGR is 7.2%.

Consensus 12-month target price of S$1.69 translates to a potential upside of 14.2%
from the current level.
INVESTMENT HIGHLIGHTS

Nailing down its commodity trading business,
which mainly focuses on dealing
copper and naphtha. While the industry is volatile and seasonal in nature, we think
management has been prudent in its risk management thus far. Counterparty risk is
mitigated as clients are mostly state-owned companies and global firms. Volume is
expected to be maintained at current levels, or slightly higher, to avoid being too
aggressive and speculative. Exposure to certain commodities such as agriculure
and steel-related, which are extremely cyclical, are kept to a minimum if not
completely avoided.

Steady S$20m-25m annual earnings contribution in the near term
is within
management’s expectations for the commodity trading segment. While this will be
unevenly recognised on a quarterly basis, the full-year estimate still accounts for
about 19-24% of the group’s net profit (based on 2013) and provides some visibility
going forward. In our view, the potential upside to this range could come from better
margins and higher volume for naphtha, where the optimal niche market stake is in
the range of 10-15% vs CWT’s current 8-10% control.

Financial services – next phase to conquer
as the group continues to create
synergies from its strength in logistics and commodities. CWT’s presence in financial
services is through its brokering subsidiary Straits Financial Group, and trade
solutions associate Westford Trade Services. In 2013, this division only contributed
1% to group revenue. We see the potential for CWT to leverage on its supply chain
management solutions for commodities to expand its scope of brokering services to
commodity-related firms in Asia. With a conservatively moderate growth outlook on
the other divisions, we think it is possible that management will look to derive its
upside in the medium to long term from this division.

sorry. forgot to mention. it is from UOB Kayhian.