Daily Brief Industrials: Chip Eng Seng Corp, Wai Kee Holdings and more

• Privatized and Delisted: Chip Eng Seng was voluntarily delisted from the Singapore Exchange (SGX) in February 2023 following a successful privatization offer by Tang Dynasty Treasure, an investment vehicle of Celine and Gordon Tang. This move was intended to provide the company with greater flexibility to manage its businesses and optimize the use of its resources away from the pressures of the public market.
• Diversified Conglomerate Structure: The company operates across multiple segments including construction, property development, property investment, hospitality, and education. Its origins trace back to the 1960s as a construction subcontractor, with a long history in Singapore’s public housing sector before diversifying.
• Challenging Financial Performance Pre-Delisting: Prior to its privatization, the company faced a period of declining profitability, recording net losses in both 2020 and 2021. This performance, coupled with a share price trading at a significant discount to its net asset value, was a key factor leading to the privatization offer.

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• Wai Kee Holdings is a Hong Kong-based construction and infrastructure company facing significant profitability challenges, primarily driven by substantial losses from its strategic investment in associate company, Road King Infrastructure Limited.
• Despite consistent year-over-year revenue growth from its core construction, quarrying, and materials segments, the company’s bottom line has been severely impacted by impairments and shared losses from Road King’s exposure to the challenging property market in Mainland China.
• The company’s valuation appears deeply discounted on a price-to-book basis, reflecting high uncertainty and poor sentiment, but its core operations are positioned to benefit from long-term public infrastructure spending in Hong Kong.

This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.