Yangzijiang Shipbuilding (Holdings)

[CityFarmer]

The company share seems getting Mr. Market attention lately

Citi Analyst Report, rating BUY, TP $1.6

(vested)

Bigger and Better; Raising Estimates and Target Price
Raising estimates – Consensus-beating margins, strong EPS visibility into 2016E,
breaking into 10K TEU containerships reinforce YZJ's fundamental outlook. While
the stock has risen 23% (12M), we see further re-rating as YZ secures a firmer
foothold in larger container vessels and achieves better margins from productivity
gains. Ability to shorten the manufacturing cycle for its 10k TEU containerships will
be key. It is also scaling up the value chain targeting complex LPG vessels. We
raise 2014-16E EPS 21-50% on better than expected margins, one-off gains, and
higher contribution from HTM assets. SOTP TP is raised from S$1.50 to S$1.60.

Source: Citi Analyst Report, dated 1 Sept 2014.

[kyle]

http://www.reuters.com/article/2014/09/0...N920140904


China publishes first "white list" of 51 shipyards

(Reuters) - China has released its first "white list" of 51 shipyards that it deems worthy of favourable policy support, as the world's largest shipbuilder strives to tackle over-capacity that has slammed the global shipping market.

The government said last year said shipbuilders that complied with its requirements in areas like ship emissions would be put on a white list for favourable policy support, such as export tax rebates and bank credit.

The list published on the Ministry of Industry and Information Technology's website on Wednesday included the Jiangsu shipyard of heavily indebted China Rongsheng, Singapore-listed Yangzijiang's New Yangzi shipyard and two of Sinopacific Shipbuilding yards.

Fifteen yards affiliated with state-owned China State Shipbuilding Corporation and China Shipbuilding Industry Corporation, four related to China Ocean Shipping (Group) Co., two controlled by Sinotrans & CSC Holdings and one owned by China Shipping Group Co were also listed.

A ministry official said it intended to publish two more lists, though no timetable had been set.

China has more than 1,600 shipyards and analysts predict that about a third will shut as the industry struggles to emerge out of a capacity glut that has hit freight rates. Rongsheng, the largest private shipbuilder, came close to insolvency last year before it agreed with banks to extend its debt payments.

Banks have tightened lending to the industry even as it grapples with a fall in orders and high debt, amid a wider push from the government to rein in support for industries plagued with over-capacity.

China last year laid out a detailed three-year plan to restructure its massive shipbuilding industry, urging local governments to halt approvals of new projects and firms to build higher quality vessels.

[CityFarmer]

I am glad the company is within the first "white list"...

(vested)

China publishes first "white list" of 51 shipyards

(Reuters) - China has released its first "white list" of 51 shipyards that it deems worthy of favourable policy support, as the world's largest shipbuilder strives to tackle over-capacity that has slammed the global shipping market.

The government said last year said shipbuilders that complied with its requirements in areas like ship emissions would be put on a white list for favourable policy support, such as export tax rebates and bank credit.

The list published on the Ministry of Industry and Information Technology's website on Wednesday included the Jiangsu shipyard of heavily indebted China Rongsheng, Singapore-listed Yangzijiang's New Yangzi shipyard and two of Sinopacific Shipbuilding yards.

Fifteen yards affiliated with state-owned China State Shipbuilding Corporation and China Shipbuilding Industry Corporation, four related to China Ocean Shipping (Group) Co., two controlled by Sinotrans & CSC Holdings and one owned by China Shipping Group Co were also listed.

A ministry official said it intended to publish two more lists, though no timetable had been set.

China has more than 1,600 shipyards and analysts predict that about a third will shut as the industry struggles to emerge out of a capacity glut that has hit freight rates. Rongsheng, the largest private shipbuilder, came close to insolvency last year before it agreed with banks to extend its debt payments.

Banks have tightened lending to the industry even as it grapples with a fall in orders and high debt, amid a wider push from the government to rein in support for industries plagued with over-capacity.

China last year laid out a detailed three-year plan to restructure its massive shipbuilding industry, urging local governments to halt approvals of new projects and firms to build higher quality vessels.
[/quote]

[CityFarmer]

HTM asset is always the "concern" of Mr. Market on the company...

(vested)

Yangzijiang Shipbuilding downgraded to ‘hold’ by OCBC; fair value at $1.24

OCBC Investment Research has downgraded China shipbuilder Yangzijiang to a “hold” in an update report on Sept 24.

OCBC says Yangzijiang remains exposed to risks from its financing business while its share price has appreciated.

Having weathered the recent shipbuilding slowdown well, Yangzijiang has amassed a cash pile of RMB7.6 billion ($1.6 billion), in addition to its held-to-maturity (HTM) assets of RMB13 billion as at 2Q14. But the group also has borrowings of about RMB11.4 billion and a significant portion of Yangzijiang’s held-to-maturity assets are entrusted loans.

Although OCBC expects Yangzijiang to pare its RMB13 billion HTM assets down to about RMB12 billion by the end of this year, it may take some time before the group is able to unwind most of its HTM assets, the research house adds.

Meanwhile, Yangzijiang’s share price has appreciated by about 11% since OCBC upgraded the stock to “buy” on 6 Aug, compared to the STI’s flattish performance over the same period.

As such, OCBC now see limited upside potential after its good price performance and has downgraded its rating to “hold”. OCBC's fair value estimate of the stock has been risen from $1.21 to $1.24, after updating its CNY/SGD exchange rate assumptions.

Yangzijiang is down 0.43% at $1.17 as at 11:54 am Singapore time.
http://www.theedgesingapore.com/the-dail...t-124.html

[CityFarmer]

The company continue to disposal the property assets. It should be substantial this round, but yet to find out more.

http://infopub.sgx.com/FileOpen/Announce...eID=319397

[greengiraffe]

Its a good move.

However, the streamlining back to core can only do so much to mitigate the headwinds facing the global offshore and marine sector.

YJZ's main advantage lies in a relatively low costs base relative to Singapore established players. However, given the rapid rise in Chinese labour costs, how long can the relative advantage lasts.

I will underweight O&M plays for a while.

Not Vested
GG

The company continue to disposal the property assets. It should be substantial this round, but yet to find out more.

http://infopub.sgx.com/FileOpen/Announce...eID=319397

[Tiggerbee]

Its a good move.

However, the streamlining back to core can only do so much to mitigate the headwinds facing the global offshore and marine sector.

YJZ's main advantage lies in a relatively low costs base relative to Singapore established players. However, given the rapid rise in Chinese labour costs, how long can the relative advantage lasts.

I will underweight O&M plays for a while.

Not Vested
GG

The company continue to disposal the property assets. It should be substantial this round, but yet to find out more.

http://infopub.sgx.com/FileOpen/Announce...eID=319397

Perhaps the steep fall in steel prices are lifting the gross margins more than the rise in operating costs.

(Not vested)

[BlueKelah]

As I said before when shipping was down, o&g will also down, mega ships must use a lot of fuel.

Also previously I have talked about how there was no margin of safety in this stock.

HTM loans were a big risk YZJ diversified into, now would be to see if they can get out in time.

Not. Vested


via Xperia Z1 with Android 4.4.4 tapatalk.

[Greenrookie]

It is the divestment in stake by its property arm, the property arm still intact, and will most probably continue to be until the ex- yard land is developed.

As for HTM, my SPECULATION is that will never exit the HTM business, what it will do is 金蝉脱壳，take another form, either through a RTO, spin off, injection into new business.

GG, till now, there is only 1 firm order, the previous order is gone with the non- placement of deposit. Which show the prudence of YZJ. I am quite it is not an O&G company given it's small exposure. It's core it still at bulks and containers. They talk about LPG and LNG carriers for so long and no firm orders, that is disappointing.

Nôt vested, waiting for re-enter.

[greengiraffe]

Rest be assured that global yards will be re-entering whatever space when they capacity is being freed up. Bulk and containers end market remains in doldrums and hence remains a highly risky space.

I always very blur when it comes to small sectorial analysis. To me big picture is flashing amber, so I stay all clear.

Not Vested
GG

It is the divestment in stake by its property arm, the property arm still intact, and will most probably continue to be until the ex- yard land is developed.

As for HTM, my SPECULATION is that will never exit the HTM business, what it will do is 金蝉脱壳，take another form, either through a RTO, spin off, injection into new business.

GG, till now, there is only 1 firm order, the previous order is gone with the non- placement of deposit. Which show the prudence of YZJ. I am quite it is not an O&G company given it's small exposure. It's core it still at bulks and containers. They talk about LPG and LNG carriers for so long and no firm orders, that is disappointing.

Nôt vested, waiting for re-enter.