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Investor CentralYangzijiang Shipbuilding (Holdings) Ltd - MANAGEMENT REPLY: Who is Nakona Enterprises Limited?
It's bought out shareholders in ship-owning companies, but we're having trouble figuring out who one of them is.
7/2/2014 – Yangzijiang Shipbuilding (Holdings) Ltd has announced its acquisition of the remaining stakes in four single ship-owning companies.
In the January 23 announcement, wholly-owned subsidiary Yangzijiang Shipping Pte Ltd has struck a deal with with Döhle (IOM) Ltd and Nakona Enterprises Limited to buy the remaining 55% equity interests in MV TW Hamburg Shipping Company Ltd, MV TW Manila Shipping Company Ltd, MV TW Beijing Shipping Company Ltd, and MV TW Jiangsu Shipping Company Ltd.
Each company owns one 92,500 DWT post-panamax bulk carrier.
Yangzijiang Shipping is to pay US$1.3 mln for each company's remaining 55% stake.
Management said this acquisition ties in with its diversification strategy.
Döhle (IOM) Ltd is a ship management company in the Isle of Man, formerly known as Midocean Maritime Ltd.
Investor Central. Asian insights for global investors. We ask the tough questions of Asian companies which global investors need answers to.
1. How much will these four vessels boost earnings?
2. How much were they contributing in revenue to Yangzijiang?
Presumably, enough to make the remaining 55% stakes attractive.
3. Is shipbreaking proving more profitable than shipbuilding since entering the business?
China was consolidating its shipbuilding industry in the months concluding 2013 to stop overcapacity.
An article on Shares Investment article on November 22, 2013 said that "private yards with strong financial position such as Yangzijiang have also fared well by benefitting from a positive spillover effect by clinching the bulk of the new orders not claimed by state-backed builders".
(Total number of questions in the full story: 8)
We have sent these questions to the company to invite them for an on-camera interview, and/or seek their written response.
Management Reply:I’m afraid we are not able to provide any response to your questions below. YZJ is in the black out period now as we are close to the full year results announcement.
Hope you understand, thank you.
We thank the agency for replying to our emails.
Key financial ratios
The ticks and crosses below indicate whether the stock meets the following value investing criteria.
Price-book: 1.3x - "Price is what you pay, value is what you get" - Are you getting more than you pay for?
Yield: 4.05% - Does the stock pay a risk premium over fixed deposit rates?
Cashflow: (CNY1.83 bln) - "Profit is opinion, cash is fact" - Is the company generating cash?
Total cash & equivalents: CNY3.42 bln - Does the company have cash?
Source: Reuters
Does the company have an internal auditor? – Not known
Management: Yangzijiang Shipbuilding (Holdings) Ltd was ranked 353rd in the Governance & Transparency Index, with a score of 34 points.
Major shareholder(s):
26.10% - Newyard Worldwide Holdings Ltd
10.29% - Lido Point Investments Ltd
8.65% - Hongkong Hengyuan Investment Limited
8.58% - Citibank Nominees Singapore Pte Ltd
7.69% - HSBC (Singapore) Nominees Pte Ltd
Consensus recommendation
Consensus call: OUTPERFORM
Price target: CNY6.34
Sources & further information
Jan 23 announcement: Acquisition of remaining 55% interest in four single ship-owning companies
Dec 22, 2011 announcement: Acquisition of additional 80% beneficial interest in Jiangsu Huayuan Metal Processing Co., Ltd
2012 Annual Report
Q3FY13 Results, Press Release, Presentation Material
Shares Investment article: China's Shipbuilding Industry Consolidation – The Start Of A Revival For Yangzijiang?
Sino News article: Yangzijiang Shipbuilding moves into real estate
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