Sufficient orders attract investors to Sundart. Under the current policy environment, it's highly recommended that investors pay close attention to Sundart Holdings Limited (1568), one of the leading integrated fitting-out contractors in Hong Kong and Macau, specializing in providing professional and high-standard fitting-out works for luxury hotel projects, high-grade residential properties and commercial buildings. In addition, the Group also provides alteration, addition, construction works and manufacturing, as well as sourcing and distribution of interior decorative materials business for sales globally. During the 20-year history of the Group, Sundart has maintained high reputation due to its outstanding quality of construction. 40% of its clients have over 10 years' collaboration with Sundart, including New World Group, Cheung Kong Group and the Peninsula Hotel. As of the first half of 2016, the total contract sum and value of remaining works for the Group's projects amounted to approximately HK$6,790 million and HK$3,820 million, respectively. The Group had a total of 30 fitting-out projects in progress. Profit for the period amounted to HK$246 million, increasing by 27.4% year-on-year and the gross profit margin was 18.4%. Wynn's Macau casino, Peninsula Hotel guest rooms, Hong Kong Tai Po Tsz Shan Monastery and The Ritz-Carlton Galaxy Macau are representative projects of Sundart.
The growth of commercial fitting-out market in Hong Kong and Macau will maintain 8.2% and 13.1% of compound annual growth rate between 2015-2019 respectively. Sundart will continue to expand its market share both in Hong Kong and Macau. The current market capitalization is around HK$ 9,580 million, with PE at 17.5. The parent company, Jangho Group Company Limited (601886.SH) has the same type of business as Sundart. Some sources predicted that in order to expand mainland china market, Jangho Group may inject its mainland fitting-out business into Sundart in the future.
The share price of Sundart Holdings Limited maintained steady uptrend over the past six months, investors may consider to buy in the current price. The target price is at HK$5.0 while the stop-loss price is at HK$4.15 in the short-term.
Pun Tit Shan, CEO of Asia Wealth Securities Limited (I do not hold the relevant shares, my clients hold the relevant shares)
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