Tuesday, November 19, 2013

Suria Capital - bright outlook

Its outlook remains bright due to its stable and lucrative port concession in Sabah.

A Sabah state owned investment holding company due to its deep discount to its intrinsic value, which is underpinned by its port operations with stable cash flow generation and JV consideration from the development of Jesselton Quay.

It has also development of remaining landbank at Kota Kinabalu port and limited earnings risk as earnings trend is currently (Nov 2013) at inflexion point with multiple positive catalysts on the horizon.

Its earnings are predominantly driven by port operation which contributes 87.7% and 105% of its revenue and profit before tax respectively in the first half of 2013.

Suria could generate total free cash flow to equity of rm2.15 billion from the remaining tenure of the port concession (2014-2034) and JV consideration from the development of Jesselton Quay.

Currently (Nov 2013) it is exploring plans to develop the remaining seven acres land next to the 16.25 acre Jesselton Quay which is poised to be finalized in 2014.

Suria is involved in four business segments namely port operations, logistics and bunkering services, contract engineering and property development and ferry terminal.

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Please note that all data given are merely blogger's opinion. It is strongly recommended that you do your own analysis and research before investing.