Compiled by Cai Haoxiang
BEST WORLD INTERNATIONAL | BUY
DEC 6 CLOSE: $1.24
TARGET PRICE: $1.88
Maybank Kim Eng Research, Dec 4
We hosted Best World for a non-deal roadshow in Singapore.
Best World has set an ambitious goal to reach 5 per cent market share or 10 billion yuan ($2.04 billion) of China's 193 billion yuan skincare market, from less than 1 per cent this year.
It will continue to drive sales via expansion into more cities and focus on its 3P (product, people and plan) winning strategies.
It is tapping digitalisation and social media, such as WeChat and Facebook to enhance sales.
It is also expanding into new markets and restoring its Taiwan market.
Maintain "buy" and target price of $1.88, based on 19 times next year's estimated earnings (PEG or price earnings to growth ratio of 0.7 time using 2016-19 estimated earnings compound annual growth rate of 27 per cent).
We ascribed a 30 per cent discount to the PEG of one time for regulatory risks and competition.
KEONG HONG HOLDINGS| NOT RATED
DEC 6 CLOSE: $0.60
TARGET PRICE: $0.75
DBS Group Research, Dec 5
Keong Hong is currently trading at only 4.3 times earnings based on next year's forecast earnings.
This is at a steep discount of about 60 per cent to its peers.
Given the healthy orderbook and investments in residential, hospitality and commercial segments, we believe a 5.5 times 2018 forecast earnings valuation is fair, based on a 50 per cent discount to peer average, given its limited visibility beyond 2019 as the majority of its projects should be completed by 2018-19.
Our fair value works out to $0.75 per share, which translates to an upside of 26 per cent from the current price.
Risks are lumpy construction contracts and an economic slowdown.
TIONG SENG HOLDINGS | NOT RATED
DEC 6 CLOSE: $0.395
TARGET PRICE: $0.45
DBS Group Research, Dec 5
Tiong Seng is a construction and civil engineering company in Singapore and a niche real estate developer in China.
With Singapore's private residential property market turning around and collective sales picking up, Tiong Seng is well placed to capitalise on winning more projects from potential tenders from developers.
Our fair value of Tiong Seng is $0.45 pegged to 6.6 times next year's forecast earnings and 0.6 time book value.
Competition, lower tender prices and a slow pace of projects are key earnings risks.
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