外文报告：Maybank Kim Eng Securities-Morning Bulletin-130111

SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS
Hong Kong
Morning Bulletin
11 January 2013

 In Focus

McapUSD4. 66b ADTV USD10m
CN/ HK: Chi na St at e Const ruct i on (3311) Edward Fung
Indust ri al s | 14. 3% i ncrease i n FY13 new cont ract t arget | BUY | TP under
revi ew
Consensus: 14 Buys, 2 Holds and 2 Sel l, Consensus t arget HKD10. 43

Event: China State Construction announced after market closed yesterday that
the new contract value awarded for the FY12 amounted to HKD36.8 billion. This
represents a YoY growth of 21.53% and exceeded the FY12 target of HKD35
billion. This also implies a new contract value awarded amount of only HKD0.22
billion alone for December. As on 31 December 2012, the on-hand contract value
amounted to approximately HKD93.00 billion, among which the backlog was
approximately HKD57.69 billion, representing a YoY growth of 17.93%, which
meets the Group’s works in next three years. The company further announced
that the new contract target for FY13 is no less than HKD 40 billion, a 14.3%
increase compared to FY12 target (or 8.7% increase as compared to the new
contract awarded achievement). This new target includes about HKD20 billion
from infrastructure investment business. In the infrastructure investment business,
there will be approximately HKD15 billion contributed from new contracts of
affordable housing BT business. YTD, the Group has secured new contracts with
a total value of HKD4.909 Billion. Main new contracts secured include a
construction of a fire services training school and a driving training school in
Tseung Kwan O with contract value of HKD 2.82 billion and an affordable
Housing BT project in Jiangsu Province worth HKD 1.63 billion. As for repayment
from BT projects, company announced that another Rmb740m was received from
Tangshan and Tianjin Governments.
Implication: No big surprise in this announcement and the HKD 40 billion new
contract target in FY13 also within our expectation. A good start in FY13 with
several major contracts won, including an affordable housing project. Share price
under pressure lately on worries from the joint Announcement from Four Central
Ministries and Statement about “Prevent Illegal Local Government Financing
Activities”, which in our view should be regarded as positive for CSCI as it will
open up more opportunities. The repayment received as well as the new
affordable contract won in January should help erasing investors’ concerns.
Action: CSC is trading at 16.2X and 13X our previous FY12 and FY13 PER
estimates, respectively. Old target price was set at HKD 10.8. We are fine tuning
our numbers and will keep our Buy rating.







Research Team


Edward FUNG
Head of Research
edwardfung@http://wendang.chazidian.com
(852) 2268 0632

Ivan CHEUNG, CFA
ivancheung@http://wendang.chazidian.com
(852) 2268 0634

Ivan LI, CFA
ivanli@http://wendang.chazidian.com
(852) 2268 0641

Jacqueline KO, CFA
jacquelineko@http://wendang.chazidian.com
(852) 2268 0633

Andy POON
andypoon@http://wendang.chazidian.com
(852) 2268 0645

Alex YEUNG
alexyeung@http://wendang.chazidian.com
(852) 2268 0636

Jeremy TAN
jeremytan@http://wendang.chazidian.com
(852) 2268 0635

Karen KWAN
karenkwan@http://wendang.chazidian.com
(852) 2268 0640





















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