Uni-Asia Finance
Posted: Tue Aug 19, 2008 1:40 pmNot vested. From DBS:-
The Business
Core business in cargo ships and real estate fund management. Uni-Asia Finance offers not only finance arrangement services for ships but also acts as an investment manager as well as an investor. Its current business focus is in two types of assets: cargo ships and property. The group’s property investment is via its subsidiary, Capital Advisers, which manages niche segments, namely boutique business hotels and stylish studio residential apartments.
Highly stable fee-income business model, with about half of its estimated FY08 income recurring for the duration of the charter contracts for vessels and from the management of hotels and residential apartments.
The Stock
Maritime investment continues to be buoyant. Uni-Asia is poised to benefit from record shipyards’ orderbook as more vessels owners seek financing arrangement. It also intends to increase its vessel portfolio via direct investment or set up new ship investment funds.
Share price supported by NAV. Uni-Asia is currently trading at a 20% discount to its book value of US$0.43 (S$0.60) per share as at Jun 08. Its book NAV per share is expected to increase to US$0.45 (S$0.63) in FY09.
Fair value of S$0.73, offering 59% upside. This is derived by applying a 13.4% dividend yield for the maritime business, and for the property-related segment, we use a target P/BV of 0.7x to reflect the still sluggish property and hotel markets in Japan. Uni-Asia is well-positioned for strong growth after weathering slowdown in Japan real estate market. Catalysts for the stock include disposal of
vessels and/or properties.
The Business
Core business in cargo ships and real estate fund management. Uni-Asia Finance offers not only finance arrangement services for ships but also acts as an investment manager as well as an investor. Its current business focus is in two types of assets: cargo ships and property. The group’s property investment is via its subsidiary, Capital Advisers, which manages niche segments, namely boutique business hotels and stylish studio residential apartments.
Highly stable fee-income business model, with about half of its estimated FY08 income recurring for the duration of the charter contracts for vessels and from the management of hotels and residential apartments.
The Stock
Maritime investment continues to be buoyant. Uni-Asia is poised to benefit from record shipyards’ orderbook as more vessels owners seek financing arrangement. It also intends to increase its vessel portfolio via direct investment or set up new ship investment funds.
Share price supported by NAV. Uni-Asia is currently trading at a 20% discount to its book value of US$0.43 (S$0.60) per share as at Jun 08. Its book NAV per share is expected to increase to US$0.45 (S$0.63) in FY09.
Fair value of S$0.73, offering 59% upside. This is derived by applying a 13.4% dividend yield for the maritime business, and for the property-related segment, we use a target P/BV of 0.7x to reflect the still sluggish property and hotel markets in Japan. Uni-Asia is well-positioned for strong growth after weathering slowdown in Japan real estate market. Catalysts for the stock include disposal of
vessels and/or properties.