Excerpts from DBS Bank's report

Stock

% of Sales
In US$

% of Cost in US$

Amount of loan in US$

Sensitivity Analysis
% chg in net profit / 10% rise in US$

Riverstone Holdings

80%

35%

n.a. (Net Cash)

+6%


Riverstone Holdings -- Generates a surplus in USD - every 10% depreciation of the MYR vs USD could boost earnings (in MYR terms) by c.15%.

wong2.14Executive Chairman Wong Teek Son.
NextInsight file photo
Bulk of revenues are denominated in USD but raw material costs only represent 30% of revenues, on average.

However, we believe that the actual impact might be smaller and closer to 6% as the current competitive landscape among glove manufacturers might entail Riverstone to share more of its forex gains with customers through lower ASPs (in USD terms) in the event of a strong USD rally.

Stock

% of Sales
In US$

% of Cost in US$

Amount of loan in US$

Sensitivity Analysis
% chg in net profit / 10% rise in US$

Yangzijiang
Shipbuilding

80%

50%

US$450m

+20%

Yangzijiang is a beneficiary of stronger USD as bulk of receipts are in USD while reporting currency is in Rmb.

Yangzijiang

Share price: 
88 c

Target: 
$1.82

Bulk of the net exposure, c.40% of revenue, was unhedged as of end-2017.

Yangzijiang has prudently made a provision of Rmb1.2bn for its outstanding contracts, assuming rate at Rmb6.15/USD and higher steel cost.

Hence, strengthening USD by Rmb0.10 would result in writeback of approximately Rmb300m. We have already assumed higher USD of Rmb6.60 in our earnings forecasts.

Full report here.


Share Prices

Counter NameLastChange
AEM Holdings1.0100.010
Alliance Mineral0.1870.003
Anchor Resources0.025-
AusGroup0.035-
Avi-Tech Electronics0.3050.015
Best World Int.2.710-
China Sunsine1.3000.010
CSE Global0.4650.005
Food Empire0.5450.010
Geo Energy0.188-0.003
Golden Energy0.240-
GSS Energy0.119-0.001
HMI0.570-
ISDN Holdings0.210-
KSH Holdings0.510-
Miyoshi0.047-
Moya Asia0.0830.001
Nordic Group0.365-0.015
Oxley Holdings0.3250.005
REX International0.0910.001
Riverstone1.120-0.010
Roxy-Pacific0.410-
Sing Holdings0.395-
SingMedical0.4500.005
Sino Grandness0.059-0.001
Straco Corp.0.760-
Sunningdale Tech1.5700.020
Sunpower Group0.5250.025
The Trendlines0.100-0.001
Tiong Seng0.270-
Uni-Asia Group1.190-
XMH Holdings0.170-
Yangzijiang Shipbldg1.4100.010

NextInsight RSS

rss_2 NextInsight - Latest News

Online Now

We have 1213 guests and no members online