KSH Holdings - my reasons for buying this stock

KSH Holdings first caught my attention after I read that it had obtained a Letter of Acceptance (LOA) for Qbay. Its order book now stands at more than $460 million, so there is visibility on its performance for the next 1-2 years. It has also been constantly paying dividends over the years to shareholders, with yield of 3.4% at closing price of S$0.44. PE ratio is relatively low at 8.5, which means that the stock is not overpriced. I also noted that its earnings over the years have been pretty consistent.

Initially, I was a little skeptical of construction stocks, as I feared that construction activities in Singapore is getting rather saturated due to boom in construction activities in recent years, and I had the impression that population growth in Singapore was going to be carefully controlled/curbed due to public sentiments post-General Elections. However, that changed after the White Paper came out, which projected that Singapore would have a population of 6.9 million in 2030. My feelings on this aside, I saw this information as an indicator that construction in Singapore is going to flourish for some years.

My entry price was S$0.38, which was still below its NAV of S$0.39. It's last closing price is S$0.44, which means a gain of 15% in less than a month.

There's a buy call from OCBC, revising its TP from S$0.50 to S$0.62.

Excerpt here (from http://sgx.i3investor.com/servlets/ptres/3848.jsp):

KSH Holdings: Another quarter of strong growth

KSH reported 3Q FY13 PATMI of S$8.1m, which surged 179% YoY mostly due to contributions from its property development segment as the group recognized earnings from The Boutiq, Cityscape@Farrer Park and Rezi 26. 9M FY13 earnings now cumulate to S$22.3m, up 108.3% YoY and forming 73% of our FY13 forecast. The group has sold a significant portion of launched projects, and we expect progress billings from already sold projects to underpin earnings growth ahead. Maintain BUYwith an increased fair value estimate of S$0.62, versus S$0.50 previously, as we lower the RNAV discount for its property segment from 50% to 40% to reflect a lower risk profile given a larger percentage of projects sold, and raise our PE multiple for its construction segment from 3.0x to 4.0x - a level closer in line with that of its peers. (Eli Lee)

The full report can be obtained from here: http://kshholdings.listedcompany.com/misc/KSH-130208-OIR.pdf

Disclaimer: The ideas expressed in this blog should not be construed as an enticement to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

KSH Holdings - EARNINGS SURGE OVER 179.0%

KSH HOLDINGS’ EARNINGS SURGE OVER 179.0% TO HIT S$8.1 MILLION IN 3QFY2013 AND 108.3% TO HIT S$22.3 MILLION IN 9MFY2013

- Property Development division continues to achieve third consecutive quarter of strong growth, boosting bottomline 

- Strong construction order book of approximately S$461.0 million as at January 31, 2013

- Low gearing of 0.23x and healthy fixed deposits, cash and cash equivalents of S$66.7 million

Good set of results. Stocks may fly off the shelf tomorrow :) 

Disclaimer: The ideas expressed in this blog should not be construed as an enticement to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

My holdings - January 2013

January 2013 has been a good month for the stock market. Stocks have been rallying, after fears of US and Europe crisis are quelled by cheery reports from the two economies.

For my holdings, on the REITs side, MCT has gone up by 12% during January from S$1.22 to reach a high of S$1.37 today. Sabana has also performed well, and increased 7% from S$1.14 to reach S$1.22 today. After doing some research, I noted that Saizen Reit is trading at S$0.19 which is a significant discount to its NAV value of S$0.30. Making use of the correction today, I bought some lots at its day low of S$0.188.

I sold my Singtel lots during this time for a profit of about 6%. Even though on hindsight, I should have hold onto the shares, however, as it is rather expensive at $3+, this gives it a lot of room to fall in price + tying up my limited $ resources, therefore I decided to sell it. If Temasek goes on a selling frenzy again, I can always buy it then :)

I still have my Second Chance. In fact, I bought a few more lots when it went XD recently and price dropped to S$0.40. Price movements are rather flat for this counter, but with a yield of 8.9%, I treat this stock like a fixed deposit. I am also holding on to my  Global Premium Hotel lots. Prices have gone up 8% during January from S$0.25 to S$0.27.

Other stocks that I hold include Food Empire (good prospects with expansion of business in China and India), KSH Holdings (booming construction in Singapore, good order outlook, and company is performing well), Vizbranz (bought on impulse recently on the basis that Lam Soon may privatise the company), and Biosensors (which I have been holding for close to a year, very low PE ratio of 5x). Of these, I am most inclined to sell Vizbranz to release the funds I have tied up in this counter.

Disclaimer: The ideas expressed in this blog should not be construed as an enticement to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.