*** NEW ISSUE: NAM CHEONG SGD 4 YR ISSUE ***
Issuer: Nam Cheong Limited
Status: Direct, unconditional, unsubordinated and unsecured Notes
Rating: Unrated
Format: Reg S, S274 & 275 of Singapore SFA
Tenure: 4 Years
Issue Size: TBD
Payment: Semi-annual, actual/365 (fixed)
Details: SGD250K/MTN Programme/Singapore Law/CDP
Listing: SGX-ST
Timing: This week’s business, as early as today
– New Nam Cheong SGD 4yrs announced on the back of strong reverse interest
– Initial price guidance at low 5s
– Comps:
NCLSP 6 2015 4.66%
ASLSP 4.75 2017 4.67%
EZION 4.6 2018 4.48%
Credit highlights (taken from the leads) :
– Largest offshore support vessels (OSVs) builder in Malaysia. Nam Cheong is a leading offshore marine group in Malaysia specializing in the construction of OSVs, which are used to support the offshore exploration & production (E&P) activities of oil majors
– High orderbook and concentration on developing platform support vessels (PSVs) will drive growth. Orderbook of RM1.4 billion (as at 13 Aug 2013) will continue to drive financial performance and growth.
– Uniquely positioned to win Malaysia-based business. Nam Cheong stands to benefit from Malaysian cabotage laws that require vessel operating licenses to be granted only to Malaysian flagged vessels.
– Supportive underlying industry fundamentals. The group stands to benefit from Petronas’ RM300 billion capital expenditure plan. Nam Cheong’s close ties with Petronas-licensed companies will continue to give it a competitive edge in securing contracts.
– Nam Cheong continues to deliver strong financial results with nine consecutive quarters of profitability since May 2011 listing. For 2QFY2013’s robust vessel sales push Nam Cheong’s revenue 84% higher to RM275.3 million and net profit 83% higher to RM41.12 million.
The old Nam Cheong 6% 11/2015 did well and we have a new one today.
They are in a cushy spot of their game and generously paying as they did in 2012, a decent coupon especially if you compare with Oxley 4.75% 2018 and the rest of the recent issues.