|
Siam City Cement Pcl (SET:SCCC), Thailand's second-largest cement manufacturer with market capitalization of 73.8 billion baht as of April 20, offers two types of cement products: mixed cement, which is formulated for plastering and bricklaying works, and Portland cement, which is developed for production of reinforced concrete, concrete tiles and all kinds of concrete piles, poles and panels, as well as pre-stressed concrete products, according to the Financial Times. The products are distributed domestically and internationally to countries such as Cambodia, Myanmar, Laos, China, Vietnam and South India.
About a 45.37% stake in SCCC is controlled by the Ratanarak Group, a holding company run by Thailand's Ratanarak family.
Investors should not confuse the company with Siam Cement Pcl (SET:SCC), Thailand's largest industrial conglomerate with market capitalization 585.6 billion baht as of April 20, which operates in four business segments: Siam Cement Group (SCG) Cement-Building Materials, SCG chemicals, SCG paper and the joint investment in agricultural machines and automotive parts.
Siam City Cement said on February 11 that its fourth-quarter 2015 revenues were 7.41 billion baht, missing the 8.6 billion baht estimate of one analyst, according to the Financial Times. The company posted fourth-quarter 2015 earnings of 4.17 baht per share, missing the 5.33 baht per share estimate of one analyst.
For the full-year 2015, revenues and earnings came in at 31.12 billion baht and 19.91 baht per share, respectively, compared to the consensus estimates of 5 analysts polled by the Financial Times of 31.77 billion baht and 19.79 baht per share. SCCC reported a dividend of 15 baht a share in 2015, unchanged from 2014. The 5 analysts covering the company expect dividends of 15.02 baht a share for the upcoming fiscal year, unchanged from 2015.
In March, the Chip Mong Insee Cement (CMIC) company, a joint venture between Cambodia’s Chip Mong Group and Siam City Cement, said it broke ground on a 9 billion baht factory in Kampot province, Cambodia, as competition begins to intensify in the booming Cambodian construction sector. Separately, SCCC said it entered into an agreement to acquire operations in Bangladesh and Thailand from Cemex, Mexico’s cement and construction materials firm, for 1.86 billion baht.
From our technical viewpoint, shares of SCCC bounced off the lower trendline support of the descending wedge chart pattern at 267 baht per share and is about to break out. There is long-term technical resistance at the 345 baht level. The stock could gain some momentum, as the 136 billion baht Thai government economic stimulus package is supposed to kick in during the first-half of this year.
According to the Financial Times, the consensus amongst 10 polled investment analysts covering Siam City Cement gave the company an Outperform rating, with the median 12-month price target of 335 baht a share.
Disclosure: Long position in SCC and no recommendation. |
