Highlights

MIDF Sector Research

Author: sectoranalyst   |   Latest post: Tue, 21 Nov 2017, 09:29 AM

 

Vivocom Holdings International Berhad - Tapping Directly Into OBOR Network

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INVESTMENT HIGHLIGHTS

  • Encouraging flurry of news
  • Tapping directly into the OBOR network
  • Positive impact to VIHB’s construction expertise
  • Nonetheless, we maintain our BUY call with a TP of RM0.395 per share

Encouraging flurry of news. VIHB’s major shareholders Golden Oasis Sdn. Bhd and Ang Li Hann reportedly has inked an indicative term sheet agreement to sell their stakes to CNQC International Holdings Ltd. (CNQC) totalling to 970.27m shares - amounting to 29.15% of its total shareholding. We believe that CNQC will finance the purchase of the VIHB’s shares via share swap. The news comes as a pleasant surprise as CNQC is now roped in to support VIHB’s growth in the construction segment.

Tapping directly into the OBOR network. CNQC Holdings Ltd. is listed in the Hong Kong Stock exchange with a market capitalisation of RM2.2bn (13.10.17). CNQC was established in in 1993 as a specialist sub-structure contractor in Hong Kong. The company is a part of Qinjiang Group’s network in Mainland China established in 1952 with strong project accomplishments such as Qingdao Olympic Sailing Centre and Qingdao Liuting International Airport. Currently, CNQC’s network is extensive covering real estate development and construction across Singapore, Indonesia, Hong Kong, Macau, Indonesia and Vietnam. The company’s project in Singapore covers almost 600,000 sq. m. of saleable floor area. Since last March, CNQC has delivered 32,000 residential units in Singapore. Amongst its notable completed projects in Singapore are The Minton in Hougang, HDB Punggol Spring in Punggol, Bellewoods in Woodlands and Ecopolitan in Punggol.

Positive impact to VIHB’s construction expertise. We view the news as a positive influence on VIHB to expand its capacity and capabilities. CNQC is expected to compliment VIHB construction team in areas such as sub-structure, water infrastructure construction, real estate financing and residential development. All in, with the crosspollination of expertise, we estimate that construction margin will improve by +1.2% in FYE18/FYE19 due to the slated expansion of the project team to undertake higher volume of construction activities. Furthermore, CNQC’s track record will strengthen VIHB’s expertise to bid for higher-scaled project such as the East Coast Railway Link.

Recommendation. Altogether, we maintain our BUY call with an adjusted TP of RM0.395 per share based on discounted cash flow (DCF) with WACC of 7.4%.

Source: MIDF Research - 16 Oct 2017

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Labels: VIVOCOM

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Chart Stock Name Last Change Volume 
VIVOCOM 0.125 0.00 (0.00%) 765,600 

  Be the first to like this.
 
greatful giant outstanding shares, hard to move.
16/10/2017 18:29
yapts Spread news to catch newbie.
16/10/2017 19:36
greatful Don't be trapped. Just my advise. Take own risk.
"Undervalued" is not = small in price term.
16/10/2017 19:54
kenie SC and bank probe Vivocom research report, analyst relieved of duties
http://www.thestar.com.my/business/business-news/2016/12/01/sc-and-bank-begin-probe-on-vivocom-research-report/
17/10/2017 00:08
kenie VIHB’s co-MD/CEO Datuk Seri Dr. Yeoh Seong Mok has consulted more than RM400bn worth of projects; often as a Project Delivery Partner (PDP) to CRCC

Research house help big holder at high give TP many investor buy at high near 35 sen.do reaserch with not confirm project and no letter of award(LOA) cannot use cannot believe ,last time say have Dr. Yeoh crcc have railway project and then at 29 April 2016 give TP RM0.59 , all believe research house all lose money.
http://www.midf.com.my/images/Downloads/Research/Equity/Vivocom/VIHB-Compelling-risk-reward-from-unique-position-MIDF-290416.pdf
https://klse.i3investor.com/servlets/stk/chart/0069.jsp

Research house help big holder at high give TP many investor buy at high near 28 sen.do reaserch with not confirm project and no letter of faward(LOA) cannot use cannot believe ,last time say have Dr. Yeoh crcc have contract.RM1.1bn – Gemas JB double track and Penang
major roads 13 july 2016 give TP RM0.78 , all believe research house all lose money.
https://brokingrfs.cimb.com/a1aqHtL2K_uBEDTZMTxr-NuOcBGSDrv86bZxLpI-cjBP0PBV9f0mHrkgW70J2AzZnKN9vYiRTtvNMmY20.pdf
17/10/2017 00:11
kenie Research house help big holder at high give TP many investor buy at high near 35 sen.do reaserch with not confirm project and no letter of award(LOA) cannot use cannot believe ,now sayCNQC’s track record will strengthen VIHB’s expertise to bid for higher-scaled project such as the East Coast Railway Link . 16 October 2017 give of RM0.395, all believe research house all lose money.

https://cdn1.i3investor.com/my/files/st88k/0069_VIVOCOM/pt/MIDF/0069_VIVOCOM_MIDF_2017-10-16_BUY_0.395_Vivocom%20Holdings%20International%20Berhad%20-%20Tapping%20Directly%20Into%20OBOR%20Network_-454520267.pdf
17/10/2017 00:23
kenie HSS Engineers bags one of the first East Coast Rail Link jobs
contraxt at China Communications Construction Company (M) Sdn Bhd.
http://www.thesundaily.my/news/2017/08/09/hss-engineers-bags-one-first-east-coast-rail-link-jobs
17/10/2017 00:24
kenie HSS Engineers bags one of the first East Coast Rail Link jobs
contract at China Communications Construction Company (M) Sdn Bhd.http://www.thesundaily.my/news/2017/08/09/hss-engineers-bags-one-first-east-coast-rail-link-jobs
17/10/2017 00:25
moneykj Microln
17/10/2017 08:52
HENGYUAN sexy babe @ RM21 so many rubbish articles nowadays.
17/10/2017 13:19
zam1913 it seems like a once in lifetime opportunity ..the share price is 14.5 sen with 2016 PE of 8x and EPS of 2.4 sen
17/10/2017 22:11
zam1913 future looks promising, EPS will grow to 3.4 sen and PE will grow to 15.7x
17/10/2017 22:13
einvest88 be patience wait till after price break 16c then let d mkt do the talking
17/10/2017 22:24
ycbang Buy and keep..
18/10/2017 18:46
vimediac good for vivocom .. in long term ..longgg term..
18/10/2017 18:52


 

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