Econ Healthcare - DBS Research 2022-01-12: Share Investment Turns Sour

Econ Healthcare - Share Investment Turns Sour

ECON HEALTHCARE (ASIA) LIMITED (SGX:EHG) | SGinvestors.ioECON HEALTHCARE (ASIA) LIMITED (SGX:EHG)
  • Econ Healthcare (SGX:EHG) recently invested ~S$4.0m of its idle working capital into 11,800,000 units of shares of Crosstec Group Holdings Inc (3893 HK), an interior design solutions company listed on the Hong Kong Stock Exchange. On 11 Jan, Crosstec saw an 84% decline in its share price to HKD 0.38, which implies a potential investment loss of over S$3.2m for the company, equal to ~118% of FY22F net earnings.
  • While the losses could be recouped, we believe Econ Healthcare’s investment mandate and strategy should be tightened significantly.
  • We downgrade Econ Healthcare to a HOLD, with a target price of S$0.28 as we raise our WACC to 11.8% to reflect the uncertainty caused by this development.



Above is the excerpt from report by DBS Group Research.
Clients of DBS may access the full report in PDF @ https://www.dbs.com/insightsdirect/.



Paul YONG CFA DBS Group Research | Singapore Research Team DBS Research | https://www.dbs.com/insightsdirect/ 2022-01-12
SGX Stock Analyst Report HOLD DOWNGRADE BUY 0.28 DOWN 0.400




Previous report by DBS Research:
2021-11-18 Econ Healthcare - Long-Term Expansion Plans Intact

Relevant links:
Econ Healthcare Analyst Report,
Econ Healthcare Target Price,

Econ Healthcare Share Price History,
Econ Healthcare Announcements,
Econ Healthcare Dividends/ Corp Actions,
Econ Healthcare News Articles





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