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Q1FY2014 analyst briefing from nextinsight.
Other 4 foreign major players together with Sinwa dominates 65% of Asia Pacific market are large multinational companies: Fuji Trading (Japanese), Wrist (Danish). HMS Group (German) and EMS Seven Seas (Norwegian / Middle Eastern)
http://www.nextinsight.net/index.php/sto...ofit-up-42
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Been looking into Sinwa, and was wondering for the core business (Supply) Sinwa is in, does anyone know approximately what is the industry's npat margins?
Net Profit Margin:
2009: 11.69%
2010: 2.7%
2011: 3.91%
2012: -5.12%
2013: 4.66%
I understand that the npat margins in 2009 were that high due to the high margin chartering business. NPAT margins begin declining from 2010 onward due to their investment into the engineering business until 2012, where the company decided to start focusing on their core business. From March 2013 onwards, they starting selling off their non-core business and we see an improvement in margins and balance sheets. However, the FY2013 results, was wondering if 4.66%, (imo rather low npat margins) is the normalised level for the core business the company is in?
(not vested)
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If you look at latest quarter the profit after tax margin is about 10%. So I would say the business is improving lots, especially with the focus now on food.
So maybe Sinwa will become to shipping like what SATS is to airlines.
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(27-05-2014, 02:53 PM)BlueKelah Wrote: If you look at latest quarter the profit after tax margin is about 10%. So I would say the business is improving lots, especially with the focus now on food.
So maybe Sinwa will become to shipping like what SATS is to airlines.
Hey! Thanks for the quick reply haha. Understand that the 1Q is up quite significantly too but I attributed it to the sale of the tugboat. Hence, still does not exactly show what a normalised margin should be like?
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27-05-2014, 04:02 PM
(This post was last modified: 27-05-2014, 04:03 PM by BlueKelah.)
you can take the 4.3m PBTand minus the 1.3m for the tug boat and vehicles to get 3m then divide by 36m revenue will get 8.3%margin without tug boat sales..
But I would think the margins not so important since its already quite low. and supplying raw food is not high margin business anyways. Besides after building the new facility in singapore for food storage which they gonna import directly now, it is expected that margins will improve.
Value wise, unless the divided is very much improved, I think Sinwa is already fair value liao lah and as they say not much meat left 
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(27-05-2014, 04:02 PM)BlueKelah Wrote: you can take the 4.3m PBTand minus the 1.3m for the tug boat and vehicles to get 3m then divide by 36m revenue will get 8.3%margin without tug boat sales..
But I would think the margins not so important since its already quite low. and supplying raw food is not high margin business anyways. Besides after building the new facility in singapore for food storage which they gonna import directly now, it is expected that margins will improve.
Value wise, unless the divided is very much improved, I think Sinwa is already fair value liao lah and as they say not much meat left
Haha might have some scraps of meat left lah..but yeah its currently somewhat undervalued nearing fair value. However, given how the new CEO is changing the direction of the company in focusing on its core business which is profitable, believe at current price can be said to still be a value buy.
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At long last, Sinwa has decided to incorporate a subsidiary in Thailand. This is exciting news.
http://infopub.sgx.com/FileOpen/Press_Re...eID=304337
As far as I know, Sinwa has been operating in Thailand for sometimes, but have yet to incorporate a company there till now. In the last AGM, the CEO has said that they want to be very sure before investing money into the country. I guess we can conclude that they are now “very sure” of the potential in Thailand. Operating in a country with an incorporated company is definitely different from operating in one without.
One of Sinwa’s major client, Sodexo, has a big presence in Thailand. Sodexo is a giant in its field, and because of its size, they don’t partner with smaller players. Sinwa, thru Sodexo, should be able to ramp up its operation fairly quickly in Thailand, and also in the region.
Together with the ongoing expansion of storage facilities in Singapore, plus the buoyant offshore market and slow but sure improving general shipping market, Sinwa prospect sure looks promising.
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Sinwa enters Thai offshore sector…..
http://www.nextinsight.net/index.php/sto...d-contract
Indeed, this is a slow and steady and well-planned move..
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15-07-2014, 10:54 PM
(This post was last modified: 15-07-2014, 10:55 PM by Ben.)
Sinwa’s share today closed up $0.015 cents, or 5.88% to $0.27 cents, on modest volume but is higher than usual. Is something brewing?
1. Could it be due to the incorporation of a Thai subsidiary? Unlikely because that was announced a few days ago
2. Could it be that the deadlock with its 50/50 JV NIL, is finally going to resolve soon? Maybe.
3. Could it be that people are anticipating a good Q2? Perhaps.
Sinwa’s share price has risen by some 36% over the last one year, as compared to 2% for the STI. If we add back the 4.5 cents dividends paid in FY13, than its shares price would have risen by almost 60%. I think many people carry a false belief that this is a “dead meat” stock.
Certainly, the prospect of Sinwa is getting brighter, and it seems that more people are thinking like me.
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(15-07-2014, 10:54 PM)Ben Wrote: Sinwa’s share today closed up $0.015 cents, or 5.88% to $0.27 cents, on modest volume but is higher than usual. Is something brewing?
1. Could it be due to the incorporation of a Thai subsidiary? Unlikely because that was announced a few days ago
2. Could it be that the deadlock with its 50/50 JV NIL, is finally going to resolve soon? Maybe.
3. Could it be that people are anticipating a good Q2? Perhaps.
(2) may be the cause of price rise.
Valuation of NIL, which commenced in late 2013, is likely to complete soon.
If Sinwa's 50% share in NIL is assessed to be worth the book value of $15m or higher by the independent auditor, Sinwa current cash holdings of $30m will swell to $45m, or 13c per share.
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