06-03-2012, 11:00 PM (This post was last modified: 23-10-2013, 03:14 PM by CityFarmer.)
King Wan is principally in the business of providing mechanical and electrical (M&E) engineering services. Its customers are mainly contractors in Singapore who are engaged in property development in public and private residential sectors. M&E systems offered by the Group include:-
Investment in subsidiaries mainly in Thailand acquired during 2004 (20% Ekarat Pattana Co(Thailand), 20% Environment Pulp & paper (Thailand) contributed for majority of their profits: PBT: S$7,421,218(2010) S$6,824,295(2009) S$10,484,570* (Sale of 30% owned cable International).
The Chua's family(~29%), Ganoktip Siriviriyakul(22.02%) and other interesting shareholders of the company are Winstedt Chong (7.23%), Bobby Lim (0.55%) and Chip Eng Seng Corporation Ltd (0.37%) are in the top 20 shareholders list in the latest AR.
The following are some of the information I'd gathered as per Q3 FY2012.
Q3FY12
Total equity after Minority Interest(S$ '000) $82,189.037
Total Number of Shares ('000) 349,177.00 NTA (S$) $0.2354
Cash and Cash equivalent $30,917.22
Trade Receivables $9,076.43
Other Receivable and Prepayments $15,225.65
Inventories $1,237.63
Construction WIP $8,655.07
"Investments In Associates (35% Meadows Bright Development, 37% Dalian ShiCheng property, S.I. Propertye(30%)(Thailand), 20% Ekarat Pattana Co(Thailand), 20% Environment Pulp & paper (Thailand))" $32,677.74
Total values $97,789.73
Per Shares $0.2801
Cash (S$ '000) $30,917.22
Cash Per Shares(S$ '000) $0.09
Debt (S$'000)
Payable Less <= 1 yrs $4,214.9470
Payable Less > 1 yrs $1,032.3610
Total debt $5,247.3080
Cash - total Debt $25,669.9070 Net cash per shares $0.0735
Total Current Asset $65,382.04
Total Current Liability $20,662.06
Total Non-Current Liability $1,112.87
Net Current Asset per Share $0.1249
Market Price $0.1400 Price / Book Value $0.5948
Dividend Declared in 1H2012 : 0.5 cents
3Q 2012:
Profit before Tax contribution by Associates: S$5,550
Net profit attributable to shareholder: $7,741.382
EPS: $0.0222
Prospect 3Q 2012:
As at the date of this announcement, the Group has approximately S$161 million worth of M&E engineering contracts on hand, with completion dates ranging from financial years 2012 to 2015. Of these, S$23.4 million worth of contracts were secured from December 2011 to the date of this announcement. The Group expects this business segment to continue to contribute positively to the Group’s results in the financial year ending 31 March 2012.
With the strong balance sheet of net cash of 7 cents, I'm hoping KWC will dish out 0.8 cents of dividend in the FY2012
07-09-2012, 11:23 PM (This post was last modified: 07-09-2012, 11:24 PM by ngcheeki.)
There was surge in volume (1,865 lots) and share price (S$0.181) for King Wan in today. The cause is likely due to a report in The Edge Singapore September 10 2012, hinting of a possible special dividend from the sale of their Thai associates. I suspect the share price uptrend will be continue for the next 1 to 2 trading days. The following is what I had extracted from the article:
1. Possible 5X returns inclusive of $16 mil and $50.2 from the sale of stakes in 2 associates (Environment Pulp and Pater Co, Ekarat Pattana Co) with the original investment of $12 million.
2. Kaset Thai Industry Surgar Co (KTIS) is preparing for an IPO in 1Q FY2013.
3. King Wan stakes in KTIS is expected to be just below 3%.
4. King Wan and KTIS found each other because their controlling families share Teohew Clan.
5. After sale of stakes in EPPCO and EPC, NTA of king wan will be 31.13 cents which is twice the market value.
6. King Wan will see a significant decline in its earning as it won't be collecting dividends from their associates.
7. Opptune time to sell EPPCO and EPC as the tax break they enjoy will soon end and raw materials and energy cost will continue to rise.
8.The strength of M&E (wiring and installation of air con) Business is able to fill the 'lost' in dividend with 25,000 HDB falts launch this year and 83,251 uncompleted private units
9. 35% owned 105 units of starlight suites in RV are 51 units sold at an average price of $2,100 to $2,200
10. UOB Kay Hian and CIMB research suggested in July 12 and July 17 that KingWan is likely to give special dividend once sale proceed is received.
Yes, there was an incident where its former director of Dalian Shicheng Property Development Co Ltd (“Associate Company”) misappropriation of funds of around S$6+ million. However, based on the AR 2012 there will not be further material adjustments!!
"In the financial year ended March 31, 2011, the Board of Directors of the associate had engaged a Singapore law firm to request the Singapore Commercial Affairs Department (“CAD”) to carry out an investigation on the alleged fraud set out in (a) above. In addition, police reports have also been lodged in People’s Republic of China (“PRC”) and in Singapore on April 28, 2010 and April 30, 2010 respectively. As the investigations are currently still on-going, there is uncertainty over any adjustments which may be required to be made to the financial statements arising from further information from the investigations.The Board of Directors of the associate does not expect any further material adjustments to arise from these investigations."
Attached is the last 5 years financial performance of King Wan for your reference. The company has been in profits for the last five years and their net cash is around 9 cents which 1/2 of last trade price of 18 cents.
09-09-2012, 12:16 PM (This post was last modified: 09-09-2012, 12:23 PM by johnnydash.)
(07-09-2012, 11:23 PM)ngcheeki Wrote: There was surge in volume (1,865 lots) and share price (S$0.181) for King Wan in today. The cause is likely due to a report in The Edge Singapore September 10 2012, hinting of a possible special dividend from the sale of their Thai associates. I suspect the share price uptrend will be continue for the next 1 to 2 trading days. The following is what I had extracted from the article:
1. Possible 5X returns inclusive of $16 mil and $50.2 from the sale of stakes in 2 associates (Environment Pulp and Pater Co, Ekarat Pattana Co) with the original investment of $12 million.
2. Kaset Thai Industry Surgar Co (KTIS) is preparing for an IPO in 1Q FY2013.
3. King Wan stakes in KTIS is expected to be just below 3%.
4. King Wan and KTIS found each other because their controlling families share Teohew Clan.
5. After sale of stakes in EPPCO and EPC, NTA of king wan will be 31.13 cents which is twice the market value.
6. King Wan will see a significant decline in its earning as it won't be collecting dividends from their associates.
7. Opptune time to sell EPPCO and EPC as the tax break they enjoy will soon end and raw materials and energy cost will continue to rise.
8.The strength of M&E (wiring and installation of air con) Business is able to fill the 'lost' in dividend with 25,000 HDB falts launch this year and 83,251 uncompleted private units
9. 35% owned 105 units of starlight suites in RV are 51 units sold at an average price of $2,100 to $2,200
10. UOB Kay Hian and CIMB research suggested in July 12 and July 17 that KingWan is likely to give special dividend once sale proceed is received.
>>10
5% of sales proceed is in cash, 95 % is in ipo shares of kaset thai. from the annual report 2012.
if that's the case there will be significant market risk. so on paper the gain looks good but in reality its not locked in. it will only be realised after king wan sells its ipo shares.
if we consider the following. KTIS is estimated to have a market cap of 1.6 billion sgd. assuming the majority shareholders wish to stay majorly vested, they will place out 20% new shares for the ipo. so ipo will be worth about 300 million. Kingwan will get 45 million worth of the ipo which is 15%.
i think there will be sales restriction? not sure about this though. but legal restriction or not, the only way for king wan to get out quick will be in a good market. in a quiet, lacklustre market, kingwan has to sell the ipo slowly or risk putting pressure on the price.
we are not sure of kingwan's plans, whether to divest its stakes completely. but we know that if the ipo tanks, than kingwan will be locked in for a longer time.
so a special dividend from proceeds of this disposal seems far away.
please correct me if i am wrong
i am not sure about the ipo market in thailand, maybe someone can comment on this.
cos unless there is a localised and distinct set of circumstances in thailand that causes its ipos to be red hot, for at least 3 months so king wan can divest, than i assume that its ipo market will depend heavily on general market sentiment around the world. (two eyes on europe, slow down in china, maybe even US fiscal cliff)
so buying kingwan i will say is leveraging on market risk. market risk from its own shares as well as prospective gains.
NAKHON SAWAN : Thai Identity Sugar Group (KTIS), the country's third-largest sugar miller, is moving ahead with plans to list on the Stock Exchange of Thailand to raise funds enabling expansion including a bagasse-fuelled biogas plant.
Chief executive Parphan Siriviriyakul said the company has appointed Kasikorn Securities (K-Sec) as its financial adviser for the listing.
Group executives were mum on the time frame.
Nattharin Talthong, the executive chairman of K-Sec, said earlier the move if successful would make it the largest listed sugar company on the SET by market capitalisation.
It will also be the largest initial public offering (IPO) for a Thai sugar company, with a projected market capitalisation of 40 billion baht.
KTIS operates an integrated sugar milling complex covering sugar-cane plantation, pulp and paper production from bagasse, hydrated lime production and ethanol made from molasses.
The company is undergoing a group restructuring, as it has several affiliates, with an IPO likely by year-end.
The group consists of five companies with three related to sugar: Thai Identity Sugar Factory, Kaset Thai Sugar and Ruampol Sugar Factory.
Founded in 1974 in Uttaradit province, KTIS is the most sophisticated miller in the North, with daily crushing capacity of 18,000 tonnes.
There are two SET-listed sugar firms.
Khon Kaen Sugar Industry (KSL) was the first. Its 2005 IPO was just over 1.2 billion baht from 279.5 million shares priced at 4.30 baht apiece.
Khonburi Sugar (KBS) followed last year with an IPO price of 9.10 baht with 150 million shares for 1.365 billion baht.
KSL and KBS's market capitalisations have since grown to 20.6 billion and 4.9 billion baht, respectively.
The country's two leading sugar millers - the Mitr Phol Group and the Thai Roong Ruang Sugar Group - have not expressed any interest in listing.
Thailand has 47 sugar factories.
In a related development, KTIS yesterday purchased 40 cane harvesters and loaders, including parts and accessories, worth nearly 500 million baht from John Deere
(09-09-2012, 12:16 PM)johnnydash Wrote: i think there will be sales restriction? not sure about this though. but legal restriction or not, the only way for king wan to get out quick will be in a good market. in a quiet, lacklustre market, kingwan has to sell the ipo slowly or risk putting pressure on the price.
we are not sure of kingwan's plans, whether to divest its stakes completely. but we know that if the ipo tanks, than kingwan will be locked in for a longer time.
so a special dividend from proceeds of this disposal seems far away.
please correct me if i am wrong
Based on the circular issued to shareholder on divestment of their thai associates, there is no sale restriction. I'd extracted section 5 for your reference. Hope, it helps to answer some of the doubts.
5. RATIONALE FOR AND BENEFITS OF THE PROPOSED DISPOSALS AND USE OF PROCEEDS
5.1 Rationale
KTIS is in the midst of a restructuring exercise with the view to a public listing of its shares on SET. In this regard, KTIS intends to restructure such that EPPCO and EPC will both become its wholly owned subsidiaries. To this end, it is KTIS’ intention to acquire all the shares in EPPCO and EPC from the existing shareholders of EPPCO and EPC, which include the Company and King Wan Industries. KTIS hopes to derive synergy among the restructured group of companies as these companies each constitute a part of the bigger production chain and share certain raw materials, utilities and expertise involved in the overall operations.
The Company’s decision to divest its stake and King Wan Industries’ stake in EPPCO and EPC respectively is consistent with its commitment to optimize profitability and operations. The Proposed Disposals would enable the Company and King Wan Industries to divest its respective stakes in EPPCO and EPC at an attractive premium and allows the Company and King Wan Industries to redirect funds into other strategic opportunities. The Company and King Wan Industries will monitor the price of the Consideration Shares and the Consideration Shares will be progressively sold off as and when market prices are favourable.
The Directors are of the view that after Completion of the Proposed Disposals, the existing businesses of the Group, namely, mechanical and electrical engineering services, property, manufacturing and services, will not be significantly affected as the existing businesses of EPPCO and EPC are different from the existing businesses of the Group.
The Group has benefited from the distribution of dividends declared and paid from EPPCO and EPC. Upon completion of the Proposed Disposals, the Group will cease to receive dividends from EPPCO and EPC. In lieu of dividends, the Group will receive KTIS Shares listed on the SET. The KTIS Shares will not be subject to any moratorium or sale restriction. Hence, the Company and King Wan Industries will be free to decide on its investment strategy with respect to the Consideration Shares on either to hold or to sell the Consideration Shares to the benefit of the Company and King Wan Industries
respectively. For the period FY2010 to FY2012, the Group had received S$14.2 million and S$1.7 million in dividends from EPPCO and EPC respectively.
5.2 Use of Proceeds
The Directors are currently reviewing and assessing the Group’s plans and projections and subject to the relevant approvals, the net proceeds from the sale may be applied towards funding the expansion of the Group’s businesses, to pursue new investment
opportunities or for working capital purposes. Until such time that the net proceeds have been fully disbursed, the Company will make periodic announcements as and when material amounts from the net proceeds are disbursed. The Company does have the intention to distribute some of the excess cash back to its Shareholders. Proceeds from the Proposed Disposals may not result in an immediate increase in cash inflows. Instead, the Consideration Shares would be progressively sold off by the Company and King Wan Industries when market prices are favourable.
Cheeki, whats your target price for King Wan? Im eyeing the Dairy farm site because I know that one can sure make money assuming they priced it at a similar level to what Wing Tai is selling for Foresque residences.
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