China Everbright Water - DBS Research 2017-04-03: Another breakthrough

China Everbright Water - DBS Vickers 2017-04-03: Another breakthrough CHINA EVERBRIGHT WATER LIMITED U9E.SI

China Everbright Water - Another breakthrough

  • First urban-rural integration water supply project in Shandong with total investment of Rmb3.1bn.
  • Clinched total project wins of > Rmb4bn in 1QFY17, compared with Rmb2.5bn in FY16.
  • Stronger project pipeline.
  • Maintain BUY with TP of S$0.64.



What’s New 

  • China Everbright Water (CEW) won the bid for the Ji’nan Zhangqiu urban-rural integration water supply project in Shandong. This project is CEW’s first project of this kind and underscores the company’s success in broadening its business scope. It will also enhance its integrated business strength and reinforce its market position.
  • The project comprises different types of water projects, including water source expansion, urban-rural water supply, reservoir construction, pipeline network construction and water diversion and replenishment of reservoir. Total investment amount is c.Rmb3.1bn.
  • CEW’s project wins are already > Rmb4bn ytd, substantially higher than the Rmb2.5bn awarded for the full year of FY16.
  • The significant improvement in deal flow should bring about robust growth in construction revenue, which will subsequently increase operating services and cashflow.
  • The stronger project pipeline is positive to share price. We maintain our BUY rating on CEW with TP of S$0.64, based on 24x 12-month rolling adjusted PE (stripping out construction revenue)




Patricia YEUNG DBS Vickers | http://www.dbsvickers.com/ 2017-04-03
DBS Vickers SGX Stock Analyst Report BUY Maintain BUY 0.640 Same 0.640



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