Hong Leong Asia - CGS-CIMB Research 2023-08-31: Better Days Ahead

Hong Leong Asia - Better Days Ahead

Hong Leong Asia (SGX:H22) | SGinvestors.ioHong Leong Asia (SGX:H22)
  • Hong Leong Asia (SGX:H22)’s 1H23 core PATMI of S$31m (-4% y-o-y) came in below expectations at 39% of our FY23F. Despite stronger underlying performance by both business segments, overall profitability was dragged by weaker FX translation, higher net financing costs and additional provision of tax of S$7m for prior years.

Diesel engines (Yuchai): Recovery from a low base

  • - Read this at SGinvestors.io -
  • Despite weaker than expected recovery of China economy post COVID-reopening year-to-date, we still expect sales volume recovery in 2H23F from a low base last year; with upside catalysts including
    1. - Read this at SGinvestors.io -
    2. rollout of more supportive policies on the provincial levels to accelerate elimination of National IV diesel trucks, and
    3. continued strength in export sales. Yuchai continues to invest in R&D to develop new energy solutions.

Building materials unit (BMU): Further growth ahead in 2H23F


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