Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Asian Equities Analyst, Logistics & Transport

Tracking Traffic

Focusing on Asian logistics, transportation, and travel companies

Equity Bottom-Up

AP Moeller - Maersk A/S / Equity Bottom-Up

<ul>
<li>Maersk's Q125 results slightly beat expectations, but earnings momentum continues to wane</li>
<li>Financial guidance for FY25 unchanged, but there are notable tweaks to key assumptions</li>
<li>Q125 likely carriers' best financial period of FY25 (by far), profits set to erode rest of year</li>
</ul>


Maersk's Q125 results slightly beat expectations, but earnings momentum continues to wane
Financial guidance for FY25 unchanged, but there are notable tweaks to key assumptions
Q125 likely carriers' best financial period of FY25 (by far), profits set to erode rest of year


Maersk Q125 Results: Solid Q1 Numbers | But Mgmt Retains Negative View on FY25, Citing Uncertainty

HK/China Equity Long-Short

Osbert Tang, CFA

Singamas Container Holdings / Equity Bottom-Up

<ul>
<li>With its share price returning to HK$0.68 level, the investment value of <a href="https://www.smartkarma.com/entities/singamas-container-holdings" target="_blank" data-smartkarma-citation="entities:13602:1" rel="noopener">Singamas Container Holdings (716 HK)</a> has re-emerged.</li>
<li>Its competitor, CIMC, has just issued a positive profit alert, indicating an impressive 888.7% and 317.3% growth in reported and recurring earnings, which is positive for Singamas.</li>
<li>An 11% growth in the global containership fleet in FY24 is also beneficial to the company. Its net cash of HK$1.65bn equals 1.02x its market capitalisation.</li>
</ul>


With its share price returning to HK$0.68 level, the investment value of Singamas Container Holdings (716 HK) has re-emerged.
Its competitor, CIMC, has just issued a positive profit alert, indicating an impressive 888.7% and 317.3% growth in reported and recurring earnings, which is positive for Singamas.
An 11% growth in the global containership fleet in FY24 is also beneficial to the company. Its net cash of HK$1.65bn equals 1.02x its market capitalisation.


Singamas (716 HK): Positive Readthrough from CIMC

<ul>
<li>
<a href="https://www.smartkarma.com/entities/singamas-container-holdings" target="_blank" data-smartkarma-citation="entities:13602:1" rel="noopener">Singamas Container Holdings (716 HK)</a> is interesting in that it has a net cash of US$300m (HK$2.35bn), but its market capitalisation is only HK$1.5bn. </li>
<li>This is a possible privatisation candidate given the steep discount to cash. The thin trading volume made it difficult to function as a financing platform.</li>
<li>Business-Wise, it should have passed the trough as global container box plant utilisation is expected to improve in the next two years, driving profitability recovery.</li>
</ul>



Singamas Container Holdings (716 HK) is interesting in that it has a net cash of US$300m (HK$2.35bn), but its market capitalisation is only HK$1.5bn. 
This is a possible privatisation candidate given the steep discount to cash. The thin trading volume made it difficult to function as a financing platform.
Business-Wise, it should have passed the trough as global container box plant utilisation is expected to improve in the next two years, driving profitability recovery.


Singamas (716 HK): Net Cash 1.6x of Market Cap, Why Not Privatise?

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

Last Week in Event SPACE: Evergrande, Spark Infra, Naspers/Prosus, Boral, China Conch Ventures

The conflation of a global pandemic, marginal air freight capacity, the Suez Canal blockage, Chinese port productivity curtailment due to Covid restrictions, a ten-fold increase in freight rates, and skyrocketing steel prices, has culminated in the mother-of-all sub-optimisation recipes.  
I've discussed this situation in <a href="https://skr.ma/SjpKV" target="_blank" rel="noopener">Game Of Ports: China's "Suez Blockage" Disruption</a>, <a href="https://skr.ma/dft2W" target="_blank" rel="noopener">Squeeze Box: The Port Congestion Contagion</a>, and <a href="https://skr.ma/GGQfY" target="_blank" rel="noopener">Yang Ming Marine (2609 TT): Cargo Shipping In First Class</a>.
<a href="https://www.smartkarma.com/entities/singamas-container-hldgs" target="_blank" data-smartkarma-citation="entities:13602:1" rel="noopener">Singamas Container Hldgs (716 HK)</a> is the only listed pure-play container manufacturer.  The company announced a positive profit alert on the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0312/2021031201050.pdf" target="_blank" rel="noopener">12 March</a> for FY20, followed by a further profit positive alert on the <a href="https://www1.hkexnews.hk/listedco/listconews/sehk/2021/0630/2021063001235.pdf" target="_blank" rel="noopener">30 June</a> for its first half financials. The most recent announcement flagged net profit not less than US$50mn compared to Singamas' then market cap of ~US$180mn.
Shares are up 35% in the last month and 169% in the past twelve months.
This week I had a chat with the Singamas' CFO to get a better understand of the dynamics currently at work, and what to expect going forward.

The conflation of a global pandemic, marginal air freight capacity, the Suez Canal blockage, Chinese port productivity curtailment due to Covid restrictions, a ten-fold increase in freight rates, and skyrocketing steel prices, has culminated in the mother-of-all sub-optimisation recipes.  
I've discussed this situation in Game Of Ports: China's "Suez Blockage" Disruption, Squeeze Box: The Port Congestion Contagion, and Yang Ming Marine (2609 TT): Cargo Shipping In First Class.
Singamas Container Hldgs (716 HK) is the only listed pure-play container manufacturer.  The company announced a positive profit alert on the 12 March for FY20, followed by a further profit positive alert on the 30 June for its first half financials. The most recent announcement flagged net profit not less than US$50mn compared to Singamas' then market cap of ~US$180mn.
Shares are up 35% in the last month and 169% in the past twelve months.
This week I had a chat with the Singamas' CFO to get a better understand of the dynamics currently at work, and what to expect going forward.

Hong Kong

Singamas Container Holdings Limited, through its subsidiaries, manufactures containers and related parts, operates container depot businesses, and provides container storage, repair and trucking as well as mid-stream services.

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Singamas Container Holdings (716 HK)

Maersk Q125 Results: Solid Q1 Numbers | But Mgmt Retains Negative View on FY25, Citing Uncertainty

Maersk reported solid Q1 results on Thursday in Copenhagen, and its downbeat FY25 guidance is unchanged. That guidance implies a dramatic erosion...

Tracking Traffic

Singamas (716 HK): Positive Readthrough from CIMC

Singamas‘ investment value has returned as its competitor reports impressive 3Q24 profit growth. Global containership fleet growth will drive...

Osbert Tang, CFA

Singamas (716 HK): Net Cash 1.6x of Market Cap, Why Not Privatise?

Singamas presents a potential privatisation opportunity with a significant cash surplus compared to the market cap. Business outlook is improving...

Osbert Tang, CFA

Last Week in Event SPACE: Evergrande, Spark Infra, Naspers/Prosus, Boral, China Conch Ventures

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Singamas (716 HK): Q&A With The CFO

Even assuming Singamas makes a conservative US$50mn for FY22E, and applying an 8x PER multiple, its average over a four-year period in 2011-2014, I...

David Blennerhassett

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Maersk Q125 Results: Solid Q1 Numbers | But Mgmt Retains Negative View on FY25, Citing Uncertainty

Maersk reported solid Q1 results on Thursday in Copenhagen, and its downbeat FY25 guidance is unchanged. That guidance implies a dramatic erosion...

Tracking Traffic

Singamas (716 HK): Positive Readthrough from CIMC

​Singamas‘ investment value has returned as its competitor reports impressive 3Q24 profit growth. Global containership fleet growth will drive...

Osbert Tang, CFA

Singamas (716 HK): Net Cash 1.6x of Market Cap, Why Not Privatise?

​Singamas presents a potential privatisation opportunity with a significant cash surplus compared to the market cap. Business outlook is improving...

Osbert Tang, CFA

Last Week in Event SPACE: Evergrande, Spark Infra, Naspers/Prosus, Boral, China Conch Ventures

The weekend is here! Pour yourself a coffee, grab a comfortable seat, and sift through a brief summary of insights on various events discussed...

David Blennerhassett

Singamas (716 HK): Q&A With The CFO

Even assuming Singamas makes a conservative US$50mn for FY22E, and applying an 8x PER multiple, its average over a four-year period in 2011-2014, I...

David Blennerhassett

Singamas‘ investment value has returned as its competitor reports impressive 3Q24 profit growth. Global containership fleet growth will drive...

Singamas presents a potential privatisation opportunity with a significant cash surplus compared to the market cap. Business outlook is improving...