Ship builder and repairer Colombo Dockyard's net profit has soared 48% YoY to LKR2,156.6 mn in 2009, whilst lifting the cumulative EBITDA by a strong 51% YoY to LKR2,683.1 mn.
DOCK's 2009 net earnings were bolstered on the back of strong performance from Ship building. The Ship building segment's sharp earnings growth can be attributed to the two Cargo Vessels and the two Anchor Handling Tug Supply Vessels delivered during the year, whilst the ship repair segment's net earnings growth was slightly hampered during the quarter under review.
Forecast 2009E net profits are in line with the actual with a moderate variance of 6%. Considering the increased ship building activities supported by heavy and off-shore engineering projects, we forecast 2010E net profit to LKR2,508 mn.
The share is attractive and trading on 8.5X forecast 2010E earnings and just 2.7X projected 2010E PBV - maintain BUY
Sri Lanka Equity Analytics
World Trade Centre
Colombo, Sri Lanka
Email: info@srilankaequity.com
Web: www.srilankaequity.com
Monday, March 1, 2010
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