May[4] - Lian Beng (Buy<$0.58; Eyeing recurring revenue)

COUNTER: LIAN BENG GROUP LTD

BUSINESS: 
Established in 1973, the home-grown building construction group is principally involved in the construction of residential, industrial and commercial projects, and civil engineering projects as a main contractor. As an A1 grade contractor with the Building and Construction Authority (BCA), it is allowed to tender for public sector building projects of unlimited contract value. Its has business footprint in overseas, such as Malaysia, Indonesia and even Maldives.

HIGHLIGHTS:

(1) The latest financial results saw around 6% jump on both revenue and profit to shareholders over last 9 months as compared to same period last year. Order book stood at approximately $640 mil, which provides sustainable activities flow till FY2017. Debt to asset ratio is maintained at healthy range of 50%.

(2) Besides construction, the group has diversified into property development. Currently, it has stakes in 10 property development and investment projects, with about S$90 mil to be progressively recognized subsequently.

(3) Facing with competitive environment in construction, the group has been building its recurrent income stream through supply of ready-mixed concrete, Asphalt, leasing of construction equipment and rental income from investment properties (joint venture with Century for local worker dormitories).

(4) UOB rated this counter at 0.725 based on 25% discount from RNAV evaluation.

REASONS TO BUY:
(1) From price chart, the counter has tendency to break out from recent down falling channel. Transaction volume was relatively low during the falling period, so it suggests that major shareholder was not selling in any panic mode. Trader could position for potential uptrend.

(2) The counter has been maintaining earning with growth over the challenging environment in construction sector. Looking ahead, it could generate significant revenue from investment property and leasing business. Higher evaluation on shares price could be realized in future.

(3) Annual dividend is around 4%

ENTRY PRICE:
Immediate support and resistance 0.55 and 0.58. So suggestion is to BUY within this range.

May[3] - Neratel (Buy<$0.69; Focus on next quarter)

COUNTER: NERA TELECOMMUNICATIONS LTD

BUSINESS: 
The counter mainly operates in three business segments:
(1) Telecommunications: Sales and engineering in solutions for wireless infrastructure networks (3G/LTE base stations) and satellite communications. 
(2) Network Infrastructure: Deploy IP, broadcast as well as optical network.
(3) Payment Solutions: Provide end to end electronics payment solution for finance, banking and retailers.

OVERVIEW:

1Q2015 financial results saw net profit fell 34% year on year as Telecommunication segments reported a 42% plummet. It was due to late recognition of revenue from Middle East and Africa region. To increase chances of securing long term maintenance contract, a one-off low-margin project was committed to one Thai customer. It resulted gross margin fell 9% in latest quarter.

The latest results did provide some bright spot. Both network and payment segments registered 17% and 51% in revenue improvement. As of March 2015, management only drawn down $5.3mil of the $25mil 5 years loan facility. The remaining will be used for operation and potential M&A opportunity. Cash position is close to $20mil.

As of now, the counter has deployed 200,000 payment terminals in market. It is now the largest payment t
erminal provider in Thailand. On 18 May, it announced new contract worth $13mil has been secured.

REASONS TO BUY:
(1) The management is confident to grow 10% in profit by 2015. Combining current cash position, it is believed that annual dividend 4 cents per shares can be achieved. Based on past record, investor could expect 2 cents as dividend on coming quarter. 

(2) Due to late recognition of revenue in 1Q2015, 2Q2015 shall be registered with significant improvement. 

(3) Looking ahead, management plan to build up in-building mobile coverage network in major buildings in Indonesia. These networks will be leased to domestic Telco which will drive the growth of recurring revenue in years ahead. 

ENTRY PRICE:
The counter has been trading in lower price region over last 2 years. It has formed strong support ~0.65. Immediate ceiling is 0.695. Suggestion is to accumulate <0.0695.

May[3] - Neratel (Buy<$0.69; Focus on next quarter)

COUNTER: NERA TELECOMMUNICATIONS LTD

BUSINESS: 
The counter mainly operates in three business segments:
(1) Telecommunications: Sales and engineering in solutions for wireless infrastructure networks (3G/LTE base stations) and satellite communications. 
(2) Network Infrastructure: Deploy IP, broadcast as well as optical network.
(3) Payment Solutions: Provide end to end electronics payment solution for finance, banking and retailers.

OVERVIEW:

1Q2015 financial results saw net profit fell 34% year on year as Telecommunication segments reported a 42% plummet. It was due to late recognition of revenue from Middle East and Africa region. To increase chances of securing long term maintenance contract, a one-off low-margin project was committed to one Thai customer. It resulted gross margin fell 9% in latest quarter.

The latest results did provide some bright spot. Both network and payment segments registered 17% and 51% in revenue improvement. As of March 2015, management only drawn down $5.3mil of the $25mil 5 years loan facility. The remaining will be used for operation and potential M&A opportunity. Cash position is close to $20mil.

As of now, the counter has deployed 200,000 payment terminals in market. It is now the largest payment t
erminal provider in Thailand. On 18 May, it announced new contract worth $13mil has been secured.

REASONS TO BUY:
(1) The management is confident to grow 10% in profit by 2015. Combining current cash position, it is believed that annual dividend 4 cents per shares can be achieved. Based on past record, investor could expect 2 cents as dividend on coming quarter. 

(2) Due to late recognition of revenue in 1Q2015, 2Q2015 shall be registered with significant improvement. 

(3) Looking ahead, management plan to build up in-building mobile coverage network in major buildings in Indonesia. These networks will be leased to domestic Telco which will drive the growth of recurring revenue in years ahead. 

ENTRY PRICE:
The counter has been trading in lower price region over last 2 years. It has formed strong support ~0.65. Immediate ceiling is 0.695. Suggestion is to accumulate <0.0695.

May[2] - CMPacific (Buy<$1.1; Ever rising Toll Operator)

COUNTER: CHINA MERCHANTS HLDGS (PACIFIC)

BUSINESS: 
The counter is a leading toll road company focused on investing in and managing toll roads in People's Republic of China (PRC). It invests in and operates five toll roads located in Zhejiang, Jiangxi, Guangxi Zhuang Autonomous Region and Guizhou with total distance at 415 kilometres. Its mother company, China Merchants Group is state owned corporation of PRC which has broad business footprint such as banking, logistics, marine, real estate, etc.

OVERVIEW:

Since 2011, the counter has been producing excellent financial results with steady growth in revenue and gross profit. Dividend used to be released bi-annually at total >6% for past 3 years. Current stock price is traded at attractive range with P/B ~1 and P/E~10. The room to grow is visible.

Refer to latest result for 1Q2015, total traffic volume and toll revenue were up 7% and 2% respectively over the same period in last year. The increase was contributed mainly from Jiurui Expressway which was acquired in September last year. This could be the catalyst for subsequent quarters this years as well.

With strong cash on hand, investors could expect the counter to expand its portfolio of toll roads thus increasing benefit return.

REASONS TO BUY:
(1) Due to high dividend released and bonus shares issued, a gap down was seen in the price chart last week. It was gaining support ~1.07 which coincides with technical indicators, EMA100. The 3 years rising trend still looks intact, thus recent price correction actually presented opportunity as entry point

(2) Due to slowing down in domestic growth, state government has been dishing out policies to stimulate economy of mainland. Public Bank or China has cut interest rate 3 times over past 6 months. Investor could position in infrastructure related counters, such as CMPacific which could benefit from any rebound in mainland economy.

ENTRY PRICE:
Accumulate <$1.1 for both price gain and dividend on second half of 2015.

May[2] - CMPacific (Buy<$1.1; Ever rising Toll Operator)

COUNTER: CHINA MERCHANTS HLDGS (PACIFIC)

BUSINESS: 
The counter is a leading toll road company focused on investing in and managing toll roads in People's Republic of China (PRC). It invests in and operates five toll roads located in Zhejiang, Jiangxi, Guangxi Zhuang Autonomous Region and Guizhou with total distance at 415 kilometres. Its mother company, China Merchants Group is state owned corporation of PRC which has broad business footprint such as banking, logistics, marine, real estate, etc.

OVERVIEW:

Since 2011, the counter has been producing excellent financial results with steady growth in revenue and gross profit. Dividend used to be released bi-annually at total >6% for past 3 years. Current stock price is traded at attractive range with P/B ~1 and P/E~10. The room to grow is visible.

Refer to latest result for 1Q2015, total traffic volume and toll revenue were up 7% and 2% respectively over the same period in last year. The increase was contributed mainly from Jiurui Expressway which was acquired in September last year. This could be the catalyst for subsequent quarters this years as well.

With strong cash on hand, investors could expect the counter to expand its portfolio of toll roads thus increasing benefit return.

REASONS TO BUY:
(1) Due to high dividend released and bonus shares issued, a gap down was seen in the price chart last week. It was gaining support ~1.07 which coincides with technical indicators, EMA100. The 3 years rising trend still looks intact, thus recent price correction actually presented opportunity as entry point

(2) Due to slowing down in domestic growth, state government has been dishing out policies to stimulate economy of mainland. Public Bank or China has cut interest rate 3 times over past 6 months. Investor could position in infrastructure related counters, such as CMPacific which could benefit from any rebound in mainland economy.

ENTRY PRICE:
Accumulate <$1.1 for both price gain and dividend on second half of 2015.

May[1] - Keppel T&T (BUY<$1.68; Proxy to logistic & data center)

COUNTER: KEPPEL TELECOMMUNICATION & TRANPORTATION LTD

BUSINESS: 
The subsidiary of Keppel Corp, is a leading service provider in Southeast Asia and Europe with businesses in logistics and data center. In logistics, it offer one-stop, integrated solutions to help clients manage their entire supply chain. It owns and operates data centers across Asia Pacific and Europe, providing dedicated co-location suits with technical support. 

OVERVIEW:

On the latest financial results (1Q15), Keppel T&T registered 2% drop in revenue quarter on quarter, mainly due to lower revenue from data center division. Operation profit was lower as well due to absence of contribution from two data centers which have been divested to Keppel DC Reits. However, its logistics revenue grew 10% year on year, driven by the opening of Tampines Logistics Park and Vietnam Singapore Industrial Park.

Looking ahead, its Tianjin Eco-city Distribution Centre will be completed and operational on following quarter. First phase of Keppel Wanjiang Logistics Park is on track for completion by end of 2015. In its existing assets of data centers, revenue contribution has been growing steadily amid ramp up of occupancy. The groups is continuously seeking new data center development and acquisition opportunities in the regions.

REASONS TO BUY:
(1) The counter has been producing stable income over the past few years with low debt ratio.
(2) 2015 profit could be driven by opening of more logistic warehouses in the region.
(3) Due to release of high dividend lately, the counter has seen big gap down on its share price. However, its price has been gaining support around 1.635. Potential price gain is presented.

ENTRY PRICE:
Buy <$1.68 for potential price gain. It can be treated as defensive counter in one's portfolio for its strong fundamental prospect.