Singapore's Lian Beng Group target price raised to 0.89 sgd - CIMB-GK
10/9/2007 2:47:00 PM
SINGAPORE (Thomson Financial) - CIMB-GK Research said Tuesday it has lifted its target price for Lian Beng Group to 89 cents from 77 cents after the construction company and property developer secured a 200 million Singapore dollar contract to build a residential condominium project, bringing the group's order book to 575 million dollars.
At the same time, Lian Beng is taking a 20 percent stake in a project in northeastern Singapore, enabling it to benefit from rising residential property prices in suburban areas, the brokerage said.
"We are upgrading our 2008-2010 earnings estimates by 12-29 percent to account for the project. Due to a current shortage of contractors, Lian Beng can afford to be selective on projects and remains well positioned to clinch new contracts with better margins," CIMB-GK said in a note to clients.
The brokerage said it expects Lian Beng's net profit in in the year to May 2008 to more than triple to 15.50 million dollars from 4.4 million dollars in the previous year. Earnings will be bolstered by its strong order book, improving margins, recognition of profits from property developments and new integrated resort contracts.
At 2.35 pm (0635 GMT), Lian Beng shares were up 1.5 cents or 2.6 percent at 59.5 cents with 15.54 million shares traded.
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