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30 Jun, 2015 (Tuesday) |
 
VEEKO INT`L(1173)
Analysis¡G
Veeko International (1173) reported the annual results ended 31 March 2015, which profit for the year substantially increase 1.24 times to HK$ 102 million, mainly driven by the growth in cosmetics business. Turnover was $1.996 billion during the period, an increase of 23.3% yoy. Among that $1.448 billion was from the cosmetics business, an increase of 40.7% yoy; Segment profit was $110 million, sharply increased 128%. As of the end of March this year, the group had 81 Colourmix stores. The turnover and number of transactions of comparable stores increased by 24.1% yoy and 17.7% yoy respectively. After the year end, the Group's cosmetics business continued to maintain rapid growth. During the period of April 1 to June 20, the sales of cosmetics business grew by 52% yoy, same-store sales also recorded an ideal increase of 23%. Looking forward, the cosmetics business will continue to become the main source of revenue and growth engine for the Group. Calculated by the earnings per share of 4.365 cents and the full-year dividend of 2 cents per share, the historical PE is about 10.4 times while dividend yield exceeds 4%.(I do not hold the above stock)
Strategy¡G
Buy-in Price: $0.445, Target Price: $0.50, Cut Loss Price: $0.42
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HARBIN BANK(6138)
Analysis¡G
As at the end of 2014, operating income of HRB increased by 20.00% y-y to RMB10.253 billion with net profit of RMB3.807 billion, up 13.62% y-y. Total assets of HRB increased by 6.66% to RMB343.642 billion compared with the end of 2013, and the BVPS was RMB2.69, up 12.55%. The Bank owns strong core competitiveness in microcredit loans, which was one of the first city commercial banks in China to launch microcredit business. Considering the stable operating performance, we still hold the cautiously optimistic view on the bank's future development. Maintain Buy rating.
Strategy¡G
Buy-in Price: $2.86, Target Price: $3.85, Cut Loss Price: $2.40
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Longking ENV (600388.CH) - the Leading Company in Dust Removal Industry
Company ProfileLongking, as a leading company in China's dust removal industry, is the first of its kind to go public. Since getting listed in Shanghai Stock Exchange in Dec., 2000, the Company has developed into an innovative environmental protection engineering company and its main business has extended from simply electrostatic precipitation and electric control devices to the dust removal, desulfurization, denitrification, material handling, desulfurization operation and power plant EPC. Stable Growth of RevenueIn 2014, the Company recorded revenue of RMB 6.027 billion, up by 8% yoy; the net profit recorded the shareholders stood at RMB 463 million, up by 1% yoy, with EPS RMB1.08. Over the past five years, the Company's revenue recorded CAGR of 9.9%, with net profit growth rate being 9.8%. Overall, Longking's operation remains relatively stable. Gross Profit Margin Went upThe main business of the Company involves dust removal equipment, desulfurization and denitrification engineering projects. The dust removal equipment, the conventional business of the Company recorded revenue of RMB 3.054 billion in 2014, up by 15% yoy and accounting for 50.7% of it. Its gross margin in the year rose to 25.45%, up by 4 ppts yoy. As the other pillar of the Company, desulfurization and denitrification engineering recorded revenue of RMB 2.142 billion, up by 7% yoy and accounting for 35.5% of it. Its gross margin in the year rose to 21.4%, up by 3 ppts yoy. The gross margin growth indicated that the Company's cost control was effective. Era of Super-low Emission is ComingIn Sept., 2014, National Reform and Development Commission (NRDC) issued Action Plan for Upgrading and Renovation of Energy Saving and Emission Reduction in Coal-fired Power Industry, which stated that by 2020, air pollutants emission concentration in new power plants in 11 provinces in East China will basically meet the emission limit of a gas turbine unit. According to this criterion, which is even stricter than the previous one adopted in 2011, the concentration limit of flue, SO2 and NOx will diminish by 67%, 65% and 50% respectively. It is believed that an era of super-low emission is coming and Longking will benefit from it. ValuationIn 2014, the amount of contracts that Longking landed on electrostatic precipitation, electrostatic bag precipitation, desulfurization and denitrification grew up by 18.4% yoy and it is expected that its business results will grow by around 15% in the next three years, with the net profit reaching RMB 7 billion and RMB 8 billion respectively in 2015 and 2016. Considering the active A Share market, we set Longking's 12-month target price at RMB 22.5 per share, equivalent to 15 times forecast PE to be recorded in 2016. We give it a ¡§Accumulate¡¨ rating. (Closing price as at 26 June 2015) Financials
Click Here for PDF format...
| Recommendation on 30-6-2015 | | Recommendation | Accumulate | | Price on Recommendation Date | $ 19.120 | | Suggested purchase price | N/A | | Target Price | $ 22.500 |
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| Stock Code |
H share
Price |
A share
Price |
H share
discount |
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| Phillip Research - Hong Kong ½÷¥ß¬ã¨s³¡ ¡V »´ä¤Î¤¤°ê |
| Company |
Stock Code |
Last Update |
Suggestion |
Target Price |
Price on Recom |
| | Harbin Bank | 6138 | 25/06/2015 | Buy | 3.85 | 2.91 | | The People's Insurance Company (Group) of China | 1339 | 19/06/2015 | Buy | 6 | 4.74 | | | On Time Logistics | 6123 | 29/06/2015 | Buy | 2.2 | 1.73 | | BYD | 1211 | 24/06/2015 | Accumulate | 55 | 49.2 | | | Colour Life | 1778 | 23/06/2015 | Buy | 13.8 | 9.8 | | FANTASIA | 1777 | 04/06/2015 | Buy | 1.8 | 1.37 | | | | FORTUNE REIT | 778 | 14/10/2014 | Accumulate | 7.32 | 6.92 | | Hysan Development | 0014 | 18/03/2014 | Accumulate | 36.8 | 33.35 | | | HSBC | 5 | 09/08/2013 | Accumulate | 100.4 | 84.25 | | HSBC Holdings PLC | 0005 | 09/05/2013 | Accumulate | 95 | 87.7 | | | Kangmei Pharmaceutical | 600518 | 16/06/2015 | BUY | 62.44 | 49.98 | | Zhongxin Pharmaceuticals | 600329 | 12/05/2015 | Hold | 23.64 | 22.89 | | | Galaxy Entertainment | 27 | 28/05/2015 | Accumulate | 42 | 38.8 | | Wisdom Group | 1661 | 05/01/2015 | BUY | 6.55 | 4.6 | | | Longking ENV | 600388 | 30/06/2015 | Accumulate | 22.50 | 0.000 | | GCL New Energy | 451 | 18/06/2015 | Buy | 1.61 | 0.76 | | Food, Beverage and Retail | | | |
| | Samsonite International SA | 1910 | 11/06/2015 | Accumulate | 30 | 26.05 | | Samsonite International SA | 1910 | 26/03/2015 | Accumulate | 30 | | | | NetDragon Websoft Inc. | 777 | 26/06/2015 | Accumulate | 40.47 | 34.45 | | Tongda Group | 698 | 22/06/2015 | Accumulate | 1.7 | 1.51 | | | SPT Energy | 1251 | 24/02/2015 | Reduce | 1.5 | 1.74 | | CIMC ENRIC | 3899 | 27/10/2014 | Buy | 10 | 7.67 | | | Goldpac Group | 3315 | 18/02/2015 | N/A | | 4.77 | | KINGDEE INT`L | 268 | 02/12/2014 | Accumulate | 2.75 | 2.45 |
Information contained herein is based on sources that Phillip Securities (Hong Kong) Limited and/or its affiliates ( the ¡§Group¡¨) believe to be accurate. The Group does not bear responsibility for any loss occasioned by reliance placed upon the contents hereof. The Group (or its employees) may have interests in relevant investment products. For details of different products¡¦ risks, please view the Risk Disclosures Statement on http://www.phillip.com.hk.
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