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Reports Singapore

Singapore stock market and companies daily report (C&G Envt Protection Hldgs, Renewable Energy Asia, Sinop) (December 24, 2013)

December 24, 2013, Tuesday, 03:16 GMT | 22:16 EST | 07:46 IST | 10:16 SGT
Contributed by Shares Investment

C&G To Sell China WTE Business For Rmb1.9b

- Through its subsidiary, C&G Environmental Protection Holdings has proposed the sale of its Waste-to-Energy (WTE) business in China to Shanghai-listed utility and environmental player, Grandblue Environment, for Rmb1.9 billion (approximately $385.4 million).

- Rmb1.1 billion of the sale consideration will be paid in cash while the balance will be satisfied via an issuance of approximately 90 million Grandblue shares at Rmb8.34 apiece. Grandblue’s share price was trading at Rmb10.22 per share prior to a trading halt on 15 October 2013.

- Upon completion of the sale, C&G will rise as the second largest shareholder in Grandblue with more than 10 percent stake in the latter.

Significance: The proposed sale is expected to have a positive impact on C&G’s financials and allow the firm to refocus on the expansion of its WTE business in Southeast Asia.

REA Group Secures 5MW Solar Farm Project

- Renewable Energy Asia (REA) Group has received the approval to construct a 5-megawatt (MW) solar farm Jinhu County, Jiangsu Province in China.

- Along with its two other solar projects which are undergoing construction, REA Group will have a total capacity of 18.8MW in Jinhu County.

- The investment cost for the latest project is approximately Rmb46.8 million. Combined, the three projects, expected to complete by end-2014, will require approximately Rmb183.3 million.

Significance: In order to combat pollution issues, China has been continuously working to lift the proportion of renewable energy capacity in its overall energy mix. In view of this, REA Group intends to benefit from China’s rich solar resource, particularly in the eastern and north-eastern regions, to expand its solar business.

Sinopipe 3Q13 Earnings Down 5.6%

- In its latest fiscal quarter, Sinopipe Holdings’ 3Q13 turnover fell 6.7 percent to Rmb212.4 million, mainly attributable to lower contributions from its water supply, drainage and sewage segments, partially offset by a rise in income from Sinopipe’s telecommunication and electrical segment.

- However, a higher gross profit margin mitigated the slump in revenue as 3Q13 losses narrowed 5.6 percent to Rmb21.3 million.

- In line with a higher gross profit for the nine months ended 30 September 2013 of Rmb93.9 million, compared to Rmb76.4 million a year earlier, Sinopipe recorded a 17 percent reduction in losses to Rmb67.6 million.

Significance: Although the business outlook for the plastic pipe industry in China remains positive, Sinopipe expects to face strong competition. As such, the firm will continue to review and restructure its operation, implement cost control measures and improve governance.