KSH Holdings

[revelationofpyramids]

KSH breaking out now at last after a long time. Is the China JV the reason?

[ngcheeki]

KSH breaking out now at last after a long time. Is the China JV the reason?

Personally, I felt it is the coming full year result FY2014. People are expecting good dividend since their 9MFY2014's EPS is already $0.081 cents which is only slightly less than FY2013's EPS of 8.8 cents. By the way, I'm expecting dividend of 1.25 cents per share (vs 0.0115 for FY2013) and that make a total dividend of 2.5 cents.

vested

[LionFlyer]

http://infopub.sgx.com/FileOpen/KSH%20Ho...eID=298777

http://infopub.sgx.com/FileOpen/KSH%20-%...eID=298778

Topline has grown significant. Dividend proposed is 1.75 cents, bringing the total year to 3 cents.

vested.

[CY09]

KSH seems to be quite a good value.

With about 100M+ profits yet to be recognized and a strong construction orderbook of 410M, KSH is likely to recognize about 38 cents of profits over the next 3 years. This calculation excludes overseas JV results in China and Cambodia. All in all, it points to a conservative RNAV of 90 cents with more upside from its local operations (I omitted prudential tower and possibility of more contracts win due to its A1 grading which allows KSH to tender in public sector's construction). The cashflow KSH will get from its first 6 properties' TOP in SG will be substantial and is likely to be used to pay down its 5.25% fixed term notes due 2016.

A low debt to equity ratio and a 5.55% yield which seems sustainable to me.

<vested>

[CY09]

In a recent URA tender, KSH/Heeton and Chip Eng Seng has won a tender for 2 lands at Jalan Kayu an average price ppr of $443.

Assuming construction & admin cost of $370 ppr. The projects total cost is about $813. The selling price of District 19 new condo units is about $1004 - $1115 (squarefoot research). Lets assumen the lower band of $1000 psf. Thus profit is about $185 psf. With a total GFA 1,098,500 sq ft and KSH's 20% stake in this project, estimated profit for KSH if fully sold is $40.644M or EPS about 9.8cents. The breakeven level of this project is 81.3%. All figures assume units sold in the project is at $1000 psf. If the release price is different, I will update accordingly.

It is nice to know KSH is adding in another decent project on top of its 115M unrecognized profit. No doubt the margin for this project is not as good as its macpherson project or King Albert Park

<vested in KSH>

[shn]

CY09,
May I know how you estimate the construction & admin cost to be $370 ppr?

I also have a vested interest in KSH.

Thank you.

[CY09]

The number is merely a guess estimate.

It is also based on past known construction cost of residential projects. However, do note the cost figure will vary because of the now more expensive foreign permits, possible difference in soil condition and cost of hiring consultants. The $370 i have estimated is on a slightly higher end.

[shn]

Thanks.

I think the construction cost should be between $200 to $250 psf- see information from BCA website
http://www.bca.gov.sg/keyconstructioninfo/keystats.html. This agrees well with some construction projects awarded to some list companies which I could find from SGX announcements. I am not sure about how to compute other costs. I also assume that tax has to be paid, which I assume to be 17%.

I hope someone who knows how to estimate the cost of property development could shed some lights.

[edwin]

In a recent URA tender, KSH/Heeton and Chip Eng Seng has won a tender for 2 lands at Jalan Kayu an average price ppr of $443.

Assuming construction & admin cost of $370 ppr. The projects total cost is about $813. The selling price of District 19 new condo units is about $1004 - $1115 (squarefoot research). Lets assumen the lower band of $1000 psf. Thus profit is about $185 psf. With a total GFA 1,098,500 sq ft and KSH's 20% stake in this project, estimated profit for KSH if fully sold is $40.644M or EPS about 9.8cents. The breakeven level of this project is 81.3%. All figures assume units sold in the project is at $1000 psf. If the release price is different, I will update accordingly.

It is nice to know KSH is adding in another decent project on top of its 115M unrecognized profit. No doubt the margin for this project is not as good as its macpherson project or King Albert Park

<vested in KSH>

based on your.calculation....the total.investment for this project is quite high $813*1098500....more.than $800m.....

[CY09]

Hi edwin,

No doubt total investment is very high. That is why many developers 1) use borrowing leverage to finance or, 2) collect a portion of the unit price from home buyers at the initial stages. Otherwise it will be hard to develop condos. In addition, do note some of the cost are progressive billings such as constructing the building.

To shn,

From your link, I am unable to find construction cost of buildings per square foot, could you guide me to the source? I am interested to see the stats, esp those for HDB