News in brief....
World Precision Machinery: It said last night that it had added three prominent manufacturers of auto parts and home appliances to its client base with total contract value of RMB11.1 million.
The new clients are:
1. Beijing Shi Yu Auto Parts, a major auto parts supplier to Hyundai Motor Group;
2. Shenyang Xinbaolu Aviation Machinery Manufacturing, an aviation and auto parts manufacturer; and
3. An unnamed subsidiary of Shenzhen-listed Guangdong Vanward New Electric, a leading gas appliance maker.
World Precision Machinery will supply high-performance and high-tonnage stamping machines to these clients.
The machines are mainly used to produce auto parts and fetch an average gross profit margin of above 35%, compared to the gross profit margin of around 25% for conventional stamping machines.
Mr Shao Jian Jun, CEO of World Precision Machinery, said: “Once again, this proves that we are the preferred partner for high-performance and high-tonnage stamping machines.”
Turning to the macro outlook, he said demand for his company’s stamping machines would rise.
“We expect capital expenditure in China to increase in line with the PRC government’s reduction of bank reserve requirements to 20.5% in February 2012, from 21.5% in December 2011. Analysts estimate the cut to release around RMB800 billion of loans to the PRC economy, and this in turn will lift the demand for stamping machines and other capital equipments.”
As of 23 February 2012, the Group’s order book stood at RMB200 million with delivery stretching over the next 3-9 months.
World Precision stock closed at 53 cents yesterday, or a PE of 6X. It has proposed a first and final dividend of RMB 0.135 (equivalent to S$ 0.027), up from RMB 0.119 (equivalent to S$ 0.023) for FY2010.
This implies a dividend yield of 5%.
Full press release can be accessed at the SGX website.
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Yongnam Holdings: It announced last night that it had secured three contracts worth a total of S$52.1 million and they will have a positive impact on its financial performance this year.
The three contracts are:
a. A specialist civil engineering contract for the MRT Downtown Line 3;
b. A structural steelwork contract for the fabrication of steel components for jack-up structures in the offshore sector, and
c. Structural steelwork for a 9-storey business park development at Portsdown Road/Fusionopolis Way.
Yongnam didn’t say what its latest outstanding orderbook is, but as at 31 December 2011, it stood at $462 million.
Yongnam stock closed at 25.5 cents yesterday, or a PE of 5.
It has proposed a first and final dividend of 1 cent a share, up from 0.65 cent for FY2010.
This implies a dividend yield of 3.9%.
Full press release can be accessed at the SGX website
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