Ho Hup

Major Shareholder Busy Buying

Author: Icon8888   |   Publish date: Wed, 11 Feb 2015, 07:32 PM

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Ho Hup Construction

Background Information

(a) Principally involved in construction and property development.

(b) Jewel of the crown is 60 acres of land in Bukit Jalil out of which 10 acres to be self developed and 50 acres JV with Malton. The JV project is called Bukit Jalil City.

(c) Under the JV agreement, Malton agrees to pay Ho Hup 18% of the GDV (estimated to be RM4.5 billion). This works out to be RM810 mil. The project will be completed within 10 years. This means that on average, every year Ho Hup is entitled to approximately RM80 mil cash proceeds from Malton.

In June 2014 quarter, Ho Hup received RM11.9 mil payment from the JV and reported RM9.8 mil gross profit. This translates into gross margin of 83%. The high profit margin is because Ho Hup doesn't need to do anything. All construction and funding costs will be borned by Malton. Based on this gross margin and 25% tax rate, average net profit per annum from the JV is approximately RM50 mil.

(d) The remaining 10 acres are being developed by Ho Hup. The project is called Aurora Bukit Jalil. The properties were launched in 2012 and has been well received. The group is currently booking in the profit from the project.

Ho Hup Construction Co Bhd (HO) Snapshot

Open 1.36		Previous Close 1.36
Day High 1.36		Day Low 1.34
52 Week High 04/24/14 - 1.72		52 Week Low 10/8/14 - 1.12
Market Cap 466.1M		Average Volume 10 Days 1.0M
EPS TTM 0.32		Shares Outstanding 342.7M
EX-Date 09/5/01		P/E TM 4.3x
Dividend --		Dividend Yield --

Strong balance sheets with only RM3.3 mil borrowing :-

The group's earnings grew substantially since December 2013 quarter.

Growth accelerated during June and September 2014 quarters :-

Quarter Result:
 

F.Y.	Quarter	Revenue ('000)	Profit before Tax ('000)	Profit Attb. to SH ('000)	EPS (Cent)	DPS (Cent)	NAPS
2014-12-31	2014-09-30	95,045	24,464	18,481	6.00	-	0.3300
2014-12-31	2014-06-30	88,531	16,734	17,044	6.65	-	0.2800
2014-12-31	2014-03-31	82,416	11,326	11,312	6.66	-	0.3000
2013-12-31	2013-12-31	47,846	9,025	12,899	12.65	-	0.8100
2013-12-31	2013-09-30	61,586	4,235	2,773	2.72	-	-0.4200
2013-12-31	2013-06-30	16,654	6,153	6,450	6.32	-	-0.4400
2013-12-31	2013-03-31	23,278	836	375	0.37	-	-0.5000

Management's comments for March 2014 quarter :-

Management's comments for June 2014 quarter :-

Management's comments for September 2014 quarter :-

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"Aurora", Ho Hup's ongoing development project in Bukit Jalil with GDV of RM1 billion.

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Bukit Jalil City

JV between Ho Hup and Malton.

According to Malton's 2014 annual report :-

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Myanmar Property Development JV

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Major shareholder has been busy buying from the open market. Between 27 November 2014 and 9 February 2015, Dato' Sri Thong Kok Khee, through Insas Plaza Sdn Bhd, acquired closed to 3 mil shares, increasing his shareholding from 35.6 mil shares to 38.4 mil shares.