Thursday, April 19, 2007

Dragon & Phoenix

Can you get a more Chinese name than that?? Stocks like DNP moves maybe once or twice a year, missed that and you might as well forget about the stock for the rest of the year. Been making good inroads on the volume charts and the perky property sector makes this stock worth exploring.

NTA RM2.00
Paid Up: 314.7m shares
Wing Tai Holdings 52.9%
The principal activities of the subsidiaries, associates and jointly controlled entity are manufacture and trading of textile garments, property development and investment, project management and maintenance of properties, restaurant operator, trading and fabrication of interior building materials. DNP is a leading garment manufacturer that supplies upper market garments to international renowned fashion labels including Polo, Fila, Gap, Lee, Denim, Banana Republic and Guy Laroche. The company operates seven garment factories in Peninsular Malaysia and two factories in Sri Lanka with a combined average monthly production of about 866,000 pieces of garments. DNP Clothing Sdn Bhd, a 51% owned subsidiary of DNP, is a garment retailer with ten outlets located in shopping complexes in Kuala Lumpur.

For its property business, the company has undertaken residential development projects namely Taman Bukit Minyak Indah and Taman Seri Impian in Seberang Perai Tengah, Penang. When completed, the freehold 45.5-acre Taman Seri Impian will have 750 units of terraced houses and semidees. Taman Bukit Minyak Indah is a freehold 28.5-acre project comprising 450 units of terraced houses and semidees. The project is planned in four phases and will be completed in two years.

Forthcoming projects for DNP include mixed development project in Hulu Kelang, Kuala Lumpur and a 38-storey service residential apartment in Johor Bahru. DNP also receives rental incomes from its investment in Lanson Place Kondominium in Ampang Hilir and Lanson Place Ambassador Row in Kuala Lumpur. DNP will see strong contributions from its major property projects in the Klang Valley, including the 110-unit The Meritz luxury condominium and 125-acre Sering Ukay project. DNP also plans to launch a new RM400m luxury condominium project in Bukit Ceylon, Kuala Lumpur in the first half ofthis year. The land parcel was bought early last year from Petaling Tin for RM59 million. The property division is DNP's largest earnings contributor, with plans toinvest nearly RM1bn to develop 3 high-end residential projects in the KlangValley this year.

What a lot of people doesn't know is that DNP is controlled and majority owned by Wing Tai Holdings. In Singapore, Wing Tai is known as a developer of high-end condos and serviced apartments as well as commercial properties in the Orchard Road area. It is also developing the 30-storey Menara DNP on an adjoining freehold 1.50-acre site on Jalan Ampang. The project is scheduled for completion in 2010. Wing Tai has increased its shareholding from 50.24% to 52.85% in January 2007 alone. Other substantial shareholders have also increased their buying over the last 3 months. Just an overall rerating for property exposure makes DNP a shrewd stock to follow.