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Singapore stock market and companies daily report (Ezra Holdings, OSIM International ,Yongnam Holdings ) (September 01, 2010)

Contributed by Shares Investment

By Shares Investment

Ezra Proposes 1-for-5 Rights Issue To Raise $155.3m

Ezra Holdings (Ezra) is proposing a 1-for-5 rights issue to raise about $155.3m in gross proceeds. The offshore service provider said that its fully underwritten renounceable rights issue will offer 131.6m new shares at an issue price of $1.18 each. Last year, Ezra’s $100m 4% convertible bonds were five times oversubscribed and its placement of 78m new shares raised another $92.4m. If its 4% convertible bonds are converted in time, then up to 142.8m new ordinary shares will be issued for gross proceeds of up to about $168.5m. For 9M10, Ezra reported a 26% increase in its earnings higher bottomline at US$54.5m. Revenue grew marginally by 4% to US$244.3m.

Significance: The 5-time oversubscribed $100m 4% convertible bonds coupled with the recent rights issue show the credibility of Ezra and allow it to beef up its core capabilities, especially in the deepwater segment.

OSIM To Focus On Expansion Plans In China

OSIM International (OSIM) intends to focus its expansion plans in China, which has been a key growth market for over 10 years. There are currently 228 OSIM outlets in China, which will increase to 270 by the end of the year. It intends to grow at the rate of 50-80 OSIM outlets a year in China, while RichLife outlets will grow to the tune of 60-100 a year. In Jul, OSIM reported that 2Q10 net profit rose 142% to $12.1m, mainly contributed by increased sales and better margins. Revenue rose 12% to $131m from $117m in the corresponding period last year. Total capital expenditure is expected to be $11-12m this year, CFO Peter Lee said. Meanwhile, in 2H10, consumers can expect more new products in the ‘Relax and Relieve’ sector, which has continuously been OSIM’s biggest driver of sales, Lee added.

Significance: The plan to make China as its prime target of expansion seems promising and lucrative given the potential market growth, lower manpower cost as well as lower rent in the mainland.

Yongnam Clinches Contract Worth $25m For The MRT Downtown Line 2

Yongnam Holdings (Yongnam), a well established structural steel contractor and specialist civil engineering solutions provider, has been awarded its first contract for the MRT Downtown Line 2 (DTL 2) valued at $25m. The contract is part of the C918 contract package, one of several packages for the DTL 2. The 16.6km long DTL 2 comprises of one depot and 12 stations including three interchange stations. DTL 2 will link to the North-East Line, the North-South Line and the Circle line, giving commuters greater accessibility to the rest of Singapore and significantly reduce travelling time. Work on the contract will start in Oct-10, with expected completion in Oct-13.

Significance: The securing of one of the Singapore’s major infrastructural projects – MRT project allows Yongnam to continue to strengthen its brand name and build up its track record.

This article is contributed by Shares Investment. Visit Sharesinv.com for the latest Singapore, Malaysia and China stock market news and reports.