Don't Stay Away From Thai Beverage Public Company Limited For Now

Thai Beverage Public Company Limited (SGX: Y92)(sgx analyst recommendation) is the main drink organization in Southeast Asia and the biggest of its kind in Thailand. It likewise has a 28.5% stake in another Singapore-recorded organization, Fraser and Neave Limited (SGX: F99), which is a drink maker and wholesaler with a long history. 

I like Thai Beverage for the different driving drink marks that it possesses, its broad dissemination arranges universal nearness in excess of 90 nations, and the development potential it has in the years ahead. 

Development designs set up 

Thai Beverage needs to wind up the biggest and most gainful drink organization in Southeast Asia by 2020. By that year, it plans to build its income share from non-mixed drinks to more than half. It likewise needs the greater part of its income to originate from outside of Thailand. 

In an offer to develop its best line, Thai Beverage finished four acquisitions in its monetary first quarter finished 31 December 2017. One of the arrangements was the buy of a 53.59% stake in Saigon Beer Alcohol Beverage Joint Stock Corp (Sabeco)(share trading tips), a Vietnam-based lager brewer. 

Sabeco has the biggest piece of the pie in Vietnam's brew showcase. It claims acclaimed brands, for example, Saigon Beer and 333 Beer. Vietnam is the most unmistakable brew showcase in Southeast Asia and the third biggest in Asia. The securing gives Thai Beverage access to broad conveyance arranges in Vietnam and broadens its items topographically. 

Amid a similar quarter, Thai Beverage additionally ate up a 75% stake in Myanmar Distillery Company (MDC), the creator of Myanmar's driving whiskey mark Grand Royal, and MDC's connected store network business. 

It is likely that Thai Beverage would encounter development in the years to come. Yet, I'm avoiding the organization, for the present.(should I buy Keppel corp now) 

Obligation loaded accounting report 

The primary motivation behind why I've not put resources into the refreshment mammoth is that I'm not happy with its frail accounting report. 

Starting at 31 March 2018, Thai Beverage had THB 234.5 billion in all-out obligation, and just THB 20.4 billion in real money and money reciprocals. In correlation, toward the finish of September 2017, it had a moderately more grounded asset report with THB 40.7 billion in absolute borrowings, and THB 9.9 billion in real money adjust.(stock Recommendation) 

Because of the huge successive increment in its obligation, Thai Beverage's equipping proportion expanded from 0.47 starting at 30 September 2017 to 1.88 starting on 31 March 2018. 

Thai Beverage's capacity to produce an abnormal state of free income should assist it with reducing its obligation in the coming years, however, I don't feel good putting resources into an organization weighed down with obligation. 

The Foolish takeaway 

Thai Beverage is the proprietor of numerous driving drink brands and appears to have a lot of development ahead in a district with a rising white collar class. Notwithstanding, the powerless monetary record is something I'm watchful about. At the point when the obligation levels are more tasteful for me, the valuation of the business may have expanded further, yet I'm not stressed over that. source

Boustead Singapore Limited Shows the Clues for Better Things to Come

Boustead Singapore Limited (SGX: F9D), which was built up in 1828, is a worldwide specialist organization of foundation related building administrations and geospatial innovation arrangements. It has three business divisions: vitality related building; land arrangements; and geospatial innovation. Boustead Singapore claims 51% of Boustead Projects Ltd (SGX: AVM), the organization's independently recorded land arrangements division. (sgx analyst recommendation)

The stock cost of Boustead Singapore has fallen by over 55% from a high of S$1.93 in April 2014 to S$0.80 as of now. The discouraged oil and gas industry and the stoppage in Singapore's modern land division are the fundamental purposes behind the poor execution of Boustead Singapore's business and hence, its offer cost. 

How long will the slump in Boustead Singapore’s business continue? No one can know for sure, but there are clues we can look at.

Sign 1: Order book recovery

Boustead Singapore's business is, for the most part, arrange book-based. Because of the idea of the organization's business, it is vital to track its request book for indications of change. A developing request book could imply that the organization's clients need the administrations it is giving, and that the businesses it is working in are recuperating. 

As can be seen from the graph beneath, Boustead Singapore's request book has tumbled from S$406 million in FY2014 (money related year finished 31 March 2014) – where a record level of requests was secured because of the-then great oil and gas speculation atmosphere – to S$180 million in FY2017. 

                                  Source: Boustead Singapore FY2018 income introduction 

In FY2018, Boustead Singapore's request book has recouped to S$313 million, a 74% year-on-year increment. Boustead Singapore said there had been a recuperation in orders at its vitality related designing and land arrangements, divisions. 

Sign 2: Better prospects

In Boustead Singapore's FY2018 final quarter profit refresh, the organization specified the accompanying (accentuations are mine): 

"Given the more advantageous request book build-up and a change in the standpoint over the parts that the Group works in, the Group is warily hopeful about business prospects. Worldwide occasions lately show a slight change in the standpoint of the Energy-Related Engineering Division." (singapore penny stocks to buy)

In the meantime, Boustead Projects said that there is "a change in development exercises in the modern land segment in Singapore" and that it can "exploit openings in its developing plan and-assemble and land improvement inquiry pipelines both in Singapore and abroad". 

The enhancing assessment in the oil and gas industry and Singapore's mechanical land division are satisfying to note. 

Sign 3: Improving net cash position 

In the business world, you may have known about the proverb, "Money is above all else." While income and benefits development may sound energizing, there is a need to produce practical income. 

                                   Source: Boustead Singapore FY2018 profit introduction 

Boustead Singapore has truly possessed the capacity to create solid floods of free income, in this manner empowering it to have a high money position on its asset report, which enables it to climate through extreme circumstances. An enhancing net money position could point to a recuperation for Boustead Singapore's business too. The organization's net money position has enhanced from S$165.9 million in FY2014 to S$194.9 million in FY2018, as observed previously.(singapore penny stocks) 

Sign 4: Higher dividend

At the point when an organization's administration expands its profit, it could mean two things: (1) administration does not see a need to keep the additional money for the business, or (2) administration is sure about the possibilities of the organization. I think it is the last for Boustead Singapore. 

In FY2018, the organization's net benefit tumbled 24% to S$25.4 million. In any case, its center net benefit (which rejects one-off additions or misfortunes) for FY2018 would have been around S$4.4 million, or 18% higher year-on-year than FY2017. 

Boustead Singapore's board had proposed the last profit of S$0.02 per share for FY2018. Together with the break profit of S$0.01 per share, the aggregate profit for the year would be S$0.03 per share. This is a half increment over FY2017's aggregate profit of S$0.02 per share. The higher center net benefit is one reason for the higher profit for FY2018, as expressed by the organization. source

You Must Watch These 3 Home-Grown Stocks

The Straits Times Index (STI) is now at its highest point since the financial crisis in 2008. While investors are showing concern about market jitters, analysts believe that there are opportunities to capture some good stocks from market overconcern. Here are three stocks that Maybank Kim Eng (MBKE), DBS and UOBKH think should be on your stock watchlist.( singapore penny stocks)

1. ST Engineering

Three years on after tough market conditions and restructuring costs, MBKE believes that ST Engineering’s growth catalysts are now falling in place.

Over the years, ST Engineering has been involved in a lot of mergers and acquisitions globally, either investing in or acquiring entities to secure technologies that can be applied or commercialized in its engineering solutions. M&As have also been carried out to justify an on-ground presence in various geographies. These M&A corporate actions have played an important part in driving ST Engineering’s revenue and profit growth cycles.

MBKE notes that ST Engineering’s aerospace Maintenance, Repair & Overhaul (MRO) is witnessing green shoots of growth from various factors: Recovery in global trade, capacity rationalization, and growth in the global aircraft fleet. The outlook for its electronics solutions also remains robust with a potential upside surprise.(should I buy Keppel corp now)

With governments increasing investments in smart city infrastructure (e.g. smart street lighting, water management, metering, cyber-security), this could bring a spike to ST Engineering’s revenue in coming years. Its recent acquisitions of SP Tel and Aethon have given ST Engineering the capabilities to unlock growth in enterprise ICT, cybersecurity solutions, and the autonomous robot market.

ST Engineering has also been focusing its efforts on forging greater integration across historically silo-like divisions. MBKE believes that it will help ST Engineering surprise on the upside on revenue (cross-selling) and cost synergies (central procurement, standardized systems) in coming 2-3 years.

BUY, TP $4.15

2. Chip Eng Seng

Singapore’s property market is on the cusp of an upcycle recovery across multiple segments from residential, commercial to hospitality. As a reputable homegrown property developer with solid operating and dividend track record, Chip Eng Seng offers a good investment opportunity for investors to add a proxy to the property market recovery to their portfolio.

So far, while a large majority of Chip Eng Seng’s property inventory has already been sold, profits will only be recognized gradually in the coming years. Looking ahead, Chip Eng Seng holds a solid property portfolio is valued at around $1.15 billion by UOBKH. The portfolio includes a series of future developments in Singapore and Australia.(sgx analyst recommendation)

UOBKH notes that the market has been undervaluing Chip Eng Seng due to its long-running litigation involving Melbourne Tower project. However, now with the expected sale of the Melbourne Tower, it could be a good time to buy Chip Eng Seng before it announces a special dividend. UOBKH likes Chip Eng Seng for its position as the cheapest dividend play in the property recovery. With its current 52 percent discount to revised net asset value and a 4.3 percent dividend yield, Chip Eng Seng definitely deserves investors’ attention.

BUY, TP $1.38

3. Banyan Tree Holdings

Banyan Tree Holdings (Banyan Tree) outperformed consensus expectations in 1Q18 with a 240 percent year-on-year growth in core profit. Its revenue grew 8.6 percent year-on-year due to higher revenue recognition from property sales as well as hotel revenue growth fuelled by strong demand in key markets like Thailand and Seychelles.

With the Thailand Ministry of Tourism targeting higher-end tourists for both Chinese and European tourist markets, Banyan Tree brand’s association with luxury is set to be a major beneficiary of this macro trend. The global upswing in economic activity is also powering broad-based growth in other key markets like China and Russia.(singapore penny stocks to buy)

With the bright outlook in Banyan Tree’s key operating markets, UOBKH opines that Banyan Tree is only in the first innings of spectacular growth from its overtures in achieving an asset-light model and leveraging on strategic partners’ core competencies. source

BUY, TP $1.00