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China Yuchai International Limited Message Board

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  • dhhtuis23 dhhtuis23 Apr 14, 2010 2:39 PM Flag

    Analysis of DBS Report

    Ok. Mr. Xu's report seems to have a discrepency. On page 4, CYD is said to have a 6.4x P/E (I assume using his 2010 estimate). That works out to $105.78m or $2.838 EPS. However, on p. 7 of his report the line for "Net Profit S$m)" shows S$41.4m for 2010. That works out to $30.159m (US$), or only $0.8093 per share. So I assumed that this net profit number (along with the sales and EBIT) was the 27.5% share HLA owns, so I grossed it up by dividing it by 27.5%. That led to the $2.94 EPS ( close to page 4 $2.838 number - although the analyst's numbers should be equivalent). It appears thought that the sales number on page 7 is for 100% of CYD and not the 27.5% share as the Net Profit number seems to be.

    Bottom line on page 4 his EPS estimate is at least $2.84 per share. At 16x that means $45.44 per share. Adding in $8.88 in net cash yields a SOTP of $54.32 per share

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    • Yes, that is what I see as well.

      For those that don't want to think about the math...bottom line is DBS Vickers has placed a minimum value on CYD of over $45 U.S....without giving any consideration to all of the cash they were sitting on at year end.

      Plus, I think this guy has underestimated what revenues will be by at least a couple of hundred million bucks.

      A screaming buy!

      • 1 Reply to jaarc.rm
      • The DBS Vickers analyst shows revenues for Yuchai of S$2,820.6 for 2009 and an estimate of S$2,994.6 for 2010.

        That is an increase of just 6.17%, or S$174 million...which is about $125 million in US Dollars.

        CYD will beat last year's first quarter by at least $270 million if they do $700 million...which is the LOW end of my range.

        This analyst is too low in his revenue estimates for 2010.

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