@Hawk Eye wrote:
Just forecast the revenue and NP that can add from projects that’s starts operation in near future
I look this as a long term investment for me.
LPG GAS GENERAL FACTORS
• A total of 3 billion people in the world are using LP Gas
• LP Gas is a clean energy solution, which emits 50% less CO2 emissions than coal and 20% less than heating oil
• LP Gas is a portable, clean and efficient energy source which is readily available to consumers around the world
• LP Gas is a co-product of crude oil production and natural gas
• it’s a versatile energy source which can be used in more than 1000 different applications
• it is mostly used in transportation, industry, farming, domestic heating and cooking and also for recreational purposes
LAUGFS GAS PLC
LAUGFS Gas PLC (LGL) is a subsidiary of the diversified business conglomerate Laugfs Holdings Ltd. The company aims to reinforce its position as the leader in the Liquefied Petroleum Gas (LPG) distribution. LGL through its subsidiaries engages in; Vehicle Emission Testing, Hospitality and Property Development
During 2010, 51% stake of Shell Gas was taken back by the government through Sri Lanka Insurance Corporation and was rebranded as Litro Gas Lanka Ltd. During the same year (2010) LGL made its initial public offering raising Rs.2.5 Bn as equity. At present LGL accounts for a 30% market share in the domestic LPG market and 60% in the industrial bulk LPG market. LPG gas Market has become a Duo-Poly market in Sri Lanka
Laugfs Gas PLC : liquefied Petroleum Gas & other related product
Growth Prospect LPG market
• 55% of the total energy is produced by burning biomass. LP Gas at present contributes to only 2%. More than 70% of industries use biomass as their primary source of fuel and the tea industry consumes about 45% from the total.
• Commercial growing of trees and the illegal felling of state forests do not fulfill the demand and as a result biomass is becoming scarce. In order to be globally competitive, industries require convenient, cleaner and more cost effective energy sources.
• Government macroeconomic policies now underway to move forward the economy towards attaining beyond USD 4,000 Per Capita Income by the year 2016 shall make the disposable income of the average consumer more affordable to switch to the usage of LP Gas as an energy source.
• .LPG Gas is Substantially under‐penetrated local LPG market (currently Sri Lankan market penetration level is only 30% compared to India’s58%) allows LGL to improve its market share with least competition
• Revenue in this segment increased from Rs.8.30bn in FY 2012 to Rs.9.7 Bn in FY2013. 16% growth
• Net Profit from Rs.8.30bn in FY 2012 to Rs.9.7 Bn in FY2013. 16% growth 636Mn to 1216Mn. 91% growth
Laugfs Power Ltd : Hydro Power
Sri Lanka’s total potential is estimated to be around 500 MW. The company at the moment is engaged with the development of mini-hydro project at “Ranmudu Oya” Balangoda. It consists of two phases to develop 1.5 MW.
Project will add revenue for the FY14/15, and should generate around 15Mn revenue.
PAP: Rs.175mn in Revenue from 18.2 MW plants.
Laugfs Eco Sri Pvt Ltd
a vehicle emission testing company, soon completing five years of successful operations. Over the years, LAUGFS Eco Sri has expanded its operations with over 90 test centers and over 5,500 tests per day.
Vehicle emission test and certification is mandatory to obtain Revenue License
• Revenue increased form Rs.711mn in FY12 to Rs.858mn in FY13 . 20% Growth
• Profits increased from Rs.302mn to Rs.407 mn.34% growth
Leisure & Hospitality Sector – (Investment 1,589 Mn).
This sector should generate around 600mn – 1000 mn revenue in future
• Ananthaya Resort in Chilaw Will be in operation from end of 2013 with approximately 90 rooms in 18 acre freehold land as a 4 star luxury hotel.
• The second hotel under construction is at Pasikuddah with 100 rooms in 15 acre leasehold land. The hotel is planned to be opened by 2014 winter as a 4 star hotel and will unleash the exciting eastern beaches and heritage sites.
• The proposed Waskaduwa hotel in 15 acre freehold land block is next in line and is expected to be completed by 2014 winter season
Property Sector– (Investment 567 Mn)
Should generate around 60Mn -100Mn
LAUGFS Property Developers are currently constructing a commercial building complex in Colombo, with several other projects in the pipeline as well.
10 Storey Commercial building nears completion and will be commercially operating from 2013 end.
LAUGFS Mineral sand project
Laugfs Holdings Limited entered into a strategic agreement with Sri Lanka Institute of Nanotechnology (SLINTEC) to process natural mineral sands for value addition. This will start as a pilot project first http://slintec.lk/nano-news/news/laugfs-slintec-tie-up-for-natural-mineral-sand-processing/
Expected the NP to improve by 10% as the current cost includes operating cost from sectors not generating any income. NP of Rs.1.5bn easily provide an EPS of Rs 3.87and NP of Rs. 2.0bn will provide an EPS of Rs.5.16
Exchange rate and tax plays a major role in the bottom line.
LGL has announced a Rs.1.5 dividend per share for both voting and nonvoting shares for the last 02 years. Good DPO ratio DY for an investment like this.