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If you are familiar with DBS target rating, once they start to downgrade a share, they will continue to down grade it the whole year.
Once next quarter result is out, DBS definitely will cut down below 1 dollar.
Good luck. Wahaha...
s100125 ( Date: 17-Jan-2013 09:22) Posted:
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be cautious on YZJ 。
1. not much new orders to date
2. if they develop their shipyard into condos, how are they going to arrange their more than 800+ shipyard related workers ? before you vest more, study the workers laws in China. all their shipyard workers can even continue to receive minimal monthly wages even after retrenchment paid for by YZJ ? for many many years.
Expect the Unexpected
Yesterday & Today
Yangzijiang - Downgrade to HOLD expect lower earnings and yield
Singapore's non-oil domestic exports plunged 16.3% y-o-y in December, after falling a revised 2.6% in November, and also below market consensus for exports to contract 8.0% y-o-y. The lackluster performance from non-electronics exports, like ship parts and machinery, piled on a worsening decline in electronics shipments. Compared with the previous month, exports rose 1.8%, after contracting a revised 0.4% m-o-m in November. Electronics exports fell 19.1% y-o-y, after falling 16.5% in November, while non-electronics shipments sank 14.8%, compared with a 6.1% rise last month. In the non-electronics sector, pharmaceutical exports fell 11.5%, after growing 29.6% in the previous month. Shipments to the European Union, its biggest export destination, fell 7.3% y-o-y in December, compared with a 0.5% rise in the previous month. Exports to the US fell 27.7% on year after falling 7.0% in November. Exports to China slipped 1.2% after the previous month's 8.9% increase.
Downgrade Yangzijiang to HOLD as share price trades close to our TP of S$1.20, and also lower earnings and yield amidst a prolonged sector downturn. Shipbuilding outlook remains challenging while offshore penetration takes time. The proposed issuance of 330m warrants at RMB0.3072 (S$0.0605) may lead to a potential maximum dilution of 7.9% if fully exercised at S$1.50/share by 29 Apr 2016. There are better funding options in our view.
Yesterday & Today
Yangzijiang - Downgrade to HOLD expect lower earnings and yield
Singapore's non-oil domestic exports plunged 16.3% y-o-y in December, after falling a revised 2.6% in November, and also below market consensus for exports to contract 8.0% y-o-y. The lackluster performance from non-electronics exports, like ship parts and machinery, piled on a worsening decline in electronics shipments. Compared with the previous month, exports rose 1.8%, after contracting a revised 0.4% m-o-m in November. Electronics exports fell 19.1% y-o-y, after falling 16.5% in November, while non-electronics shipments sank 14.8%, compared with a 6.1% rise last month. In the non-electronics sector, pharmaceutical exports fell 11.5%, after growing 29.6% in the previous month. Shipments to the European Union, its biggest export destination, fell 7.3% y-o-y in December, compared with a 0.5% rise in the previous month. Exports to the US fell 27.7% on year after falling 7.0% in November. Exports to China slipped 1.2% after the previous month's 8.9% increase.
Downgrade Yangzijiang to HOLD as share price trades close to our TP of S$1.20, and also lower earnings and yield amidst a prolonged sector downturn. Shipbuilding outlook remains challenging while offshore penetration takes time. The proposed issuance of 330m warrants at RMB0.3072 (S$0.0605) may lead to a potential maximum dilution of 7.9% if fully exercised at S$1.50/share by 29 Apr 2016. There are better funding options in our view.
s100125 ( Date: 17-Jan-2013 00:03) Posted:
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Ytd down 8 c but tdy up 6 c will be good for me. Lol
DBS Vickers maintain YZJ at buy with TP S$1.20.
me vested some
Downgrading is fake, beware. Don't listen to bearer of false gift. Hahaha.
halleluyah ( Date: 17-Jan-2013 09:10) Posted:
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Just try 10 lots @1.015, keep fr dividend n long term since china gdp getting better. Guess 2014 will b gd yr fr shipping.
To me more likely will be 3, as BB will not be so fast to formulate the strategy and will not know the warrant issue, as start from the day before the Yangzijiang already show sudden force down. yesterday after morning news release another round of forcing down. Most Singaporean are so afraid of china company issuing warrant, beside that there are not much news on shipping will be the main focus for China in coming years, thus this would be a good way for citi to get hold of this shares. So that they can easily achieved their $2 or may be $3 target, and have the warrant turns in multiper times of benefit, I don't think their pushing target is only $1.5 or $1.6, that is equivalent to doing business without earning.
GorgeousOng ( Date: 17-Jan-2013 06:40) Posted:
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Thank for your sharing! 2 or 3 is more likely. Yesterday I vested some just to test the round.
cheongsl ( Date: 17-Jan-2013 05:54) Posted:
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There are few possibility scenario to yesterday event.
1) Yangzijiang is in bad shape, BB and insider know about this and short the share hope to gain from the counter when this news come to light.
2) BB get interested with the new warrant issue and wish to participate in the game, so they short at lower price to cause peopele to fear out so that they can get hold of the shares easily and gain control of the counter.
3) Citigroup is the one that short the counter, they are trying to force out the weaker holders, so that they can push up the shareprice easily to above the exercise price so that they can easily sell all their warrant at a much higher price. As lets say Yangzijiang reach $2, and if the warrant are selling at $0.50, to the purchaser they are anticipate the price will further go up, but to citigroup, a 0.50 sell is much higher then the share gain. which is 0.5/0.065 which is 7.7 times the original warrant price.
CNY coming RMB exchange rate should be going up, as most chinese when oversea to work, if they are return to China, then they need to change back to RMB thus the currency should be going up due to the demand.
terencee ( Date: 16-Jan-2013 22:20) Posted:
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16/1/2013 - DBS Vickers maintain YZJ at buy with TP S$1.20.
Yangzijiang is proposing to issue an aggregate of 330m warrants at an issue price of RMB0.3072 (S$0.0605). Each warrant carries the right to subscribe for one new share at the strike price of RMB7.617 (S$1.50) by 29 Apr 2016. Net proceed from the warrant issuance will be RMB92.17m or S$18.15m, to be used to strengthen working capital and enhance capital base for future market expansion and development opportunities. 30m potential new shares represent 8.6% of current outstanding share or 7.9% of enlarged share cap. No dilution is expected in the near term as the exercise price implies a 36.4% premium over last closing price of S$1.10. Maintain BUY, TP: S$1.20.
For those still hazy about YZJ warrants, summary is as follows (courtesy of DBSV)
Issuance of 330m warrants. Yangzijiang proposed to issue an aggregate of 330m warrants at an issue price of RMB0.3072 (S$0.0605). Each warrant carries the right to subscribe for one new ordinary share at the strike price of RMB7.617 (S$1.50) by 29 Apr 2016.
Placement to institutional investors. Citigroup is the placement manager and warrants will be offered to institutional investors and accredited investors. The warrants will not be listed on stock exchanges.Net proceeds from warrant issuance will be RMB92.17m or S$18.15m. Potential net proceeds from the full exercise of warrants will be RMB2.5bn or S$495m.
Net proceeds from warrant issuance will be RMB92.17m or S$18.15m. Potential net proceeds from the full exercise of warrants will be RMB2.5bn or S$495m. Rationale. As explained in the announcement, the proceeds will be used to strengthen working capital and enhance capital base for future market expansion and development opportunities when shipbuilding industry recovers.
No urgent funding needs. Yangzijiang is one of the most well run yards in China with superb cost and cash management. As of end Sept 2012, Yangzijiang was in net cash position. It sat on cash (RMB3.4bn) and restricted cash (RMB5.3) of RMB8.7bn. While total borrowings amounted to RMB8.6bn, the company has invested RMB9.8bn in financial products (of which RMB7.7bn is short term investment).
Aren’t there better financing option? We believe this may be part of management's effort to enhance company's flexibility to raise money if the shipbuilding industry recovers in 2-3 years’ time. Working capital requirement is higher as Yangzijiang moves into offshore and large size containership with lower payment term of 20:80. However, we find funding via equity issue less favourable given the dilutive effect. Yangzijiang could well pare down its investment in financing products and explore cheaper financing in the debt market given its net cash position at this juncture. Near term dilution risk is low. In the event of full conversion by 2016, maximum dilution will be 7.9%. Exercise price of S$1.50 is much higher than our 12-month TP of S$1.20, representing a 36.4% premium over the last traded price of S$1.10 on 15 Jan. Hence, the risk of dilution should be low in the near term.
Downgrade to HOLD. Yangzijiang’s share price has risen 15% in the past two weeks amidst positive sentiment on China economic recovery and reduced risk premium. Current valuation is fair at 1.2x FY13 P/Bv on the back of dwindling ROE from 26% in FY12E to 11% by FY14F. PE will rise to 10x in FY14 as earnings are expected to fall by 37% yoy.
Downgrade to HOLD in the light of declining earnings and yield amidst a prolonged sector downturn. Downside risk to our order win assumption post results prevails. TP is unchanged at S$1.20 as the warrants are out-of-the money.
Perhaps CNY coming and xchange rate going down ?
I believe no company will consider money too much, especially when the nation have annouce on the intension to push for sea economic development. The warrant money from citi group will definitely provide a good based for Yangzijiang to have a more rapid expansion to capture more market at this time. The ship building industries is require good money base to expand, as usually at the design, fabrication, installation, it is difficult to get the payment, until you have delivered the ship, which is usually one to two years down the road. Thus to cater for such expansion and issuing warrant at higher share price will allow the company to competed with other shipbuilder when the times come. After the China sea authority annoucement, the China ship building shares gather most attantion and their share really shine.
But for me, my belief is that the China main intension is not to push for sea economic development, but to improve the shipbuilding capability, which further intension is to strengthen their navy capability for the south china sea island and also diaoyu dao.
cheongsl ( Date: 11-Jan-2013 21:40) Posted:
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Too bad china ship building stock continue to outperform singapore list china shipbuilding company.
cheongsl ( Date: 14-Jan-2013 21:25) Posted:
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is pretty normal for stock prices to go up and down . So long u r able to hold for longer horizon then it will not b a problem . Be happy & be contented with what u have . Dont worry too much . Smile often u will feel better .
Hulumas ( Date: 16-Jan-2013 19:40) Posted:
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Today China shipbuilding industries continue to outperform singapore list china ship builidng company.
Too bad can't buy A-share.
代 码 名 称 最 新 价 涨 跌 额 涨 跌 幅 买 入 卖 出 昨 收 今 开 最 高 最 低 成 交 量 /手 成 交 额 /万
sz300123 太 阳 鸟 15.41 0.62 4.19% 15.41 15.42 14.79 15.25 15.65 14.75 68,564 10,411.88
sz300008 上 海 佳 豪 7.65 0.47 6.55% 7.64 7.65 7.18 7.14 7.73 6.88 98,385 7,185.97
sz002608 舜 天 船 舶 21.78 1.56 7.72% 21.77 21.78 20.22 20 21.99 19.67 119,959 24,763.84
sh601989 中 国 重 工 5.24 0.29 5.86% 5.24 5.25 4.95 4.94 5.25 4.9 1,219,072 61,656.75
sh601890 亚 星 锚 链 8.95 0.61 7.31% 8.93 8.94 8.34 8.39 8.98 8.18 277,248 23,808.08
sh600685 广 船 国 际 14.37 1.31 10.03% 14.37 0 13.06 13.05 14.37 12.83 228,150 31,088.54
sh600150 中 国 船 舶 25.63 1.58 6.57% 25.62 25.65 24.05 24.06 25.95 23.28 447,685 109,086.64
sh600072 中 船 股 份 16.51 1.5 9.99% 16.5 16.51 15.01 14.9 16.51 14.74 382,181 59,613.07
Always think of negative, I am afraid you will never gain from S chip stock investment!
ynnek1267 ( Date: 16-Jan-2013 11:04) Posted:
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