Lonking Holdings Limited: Company Profile and SWOT Analysis by WMIntelligence

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									Lonking Holdings Limited

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Lonking Holdings Limited                                              Financial Snapshot

                                                                      Operating Performance
Fast Facts
                                  No.26 Mingyi Road, Shanghai,        The company reported revenue of US$1,972 million
Headquarters Address
                                  201612,China                        during the fiscal year 2011 (2011). The company's
                                                                      revenue grew at a CAGR of 29.67% during 2007–
Telephone                         + 86 21 37602000
                                                                      2011, with an annual growth of 11.25% over 2010. In
                                                                      2011, the company recorded an operating margin of
Fax                               + 86 21 57687966                    16.25%, as against 17.82% in 2010.

Website                           www.lonking.cn
                                                                      Revenue and Margins
Ticker Symbol, Stock Exchange     3339, Hong Kong Stock Exchange

Number of Employees               10,000

Fiscal Year End                   December

Revenue (in US$ million)          1,972




SWOT Analysis

Strengths                         Weaknesses                          Return on Equity

Broad range of products           Declining operational performance   The company recorded a return on equity (ROE) of
                                                                      27.00% for 2011, as compared to its peers, SANY
                                                                      Heavy Industry Co., Ltd. (Ticker: 600031), Caterpillar
Strong liquidity position         Limited financial leverage          Inc. (Ticker: CAT) and Shantui Construction
                                                                      Machinery Co., Ltd. (Ticker: 000680), which recorded
Strong market position                                                ROEs of 43.99%, 38.25% and 11.09% respectively.
                                                                      The company reported an operating margin of
                                                                      16.25% in 2011.
Opportunities                     Threats
Positive outlook for Chinese                                          Return on Equity
                                  Rising labor costs in China
construction industry

Rapid urbanization in China       Volatile input prices

Strategic growth initiatives




                                                                      Liquidity Position

                                                                      The company reported a current ratio of 2.36 in 2011,
                                                                      as compared to its peers, SANY Heavy Industry Co.,
                                                                      Ltd., Caterpillar Inc. and Shantui Construction
                                                                      Machinery Co., Ltd., which recorded current ratios of
                                                                      1.46, 1.33 and 1.31 respectively. As of December
                                                                      2011, the company recorded cash and short-term
                                                                      investments of worth US$261 million, against US$19
                                                                      million current debt. The company reported a debt to
                                                                      equity ratio of 0.84 in 2011 as compared to its peers,
                                                                      SANY Heavy Industry Co., Ltd., Caterpillar Inc. and
                                                                      Shantui Construction Machinery Co., Ltd., which
                                                                      recorded debt to equity ratios of 1.06, 2.69 and 1.42
                                                                      respectively.




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Lonking Holdings Limited - SWOT Profile                                                                       Page 1
Lonking Holdings Limited

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TABLE OF CONTENTS

1     Business Analysis ................................................................................................................................... 5
    1.1       Company Overview ......................................................................................................................................... 5
    1.2       Business Description ....................................................................................................................................... 6
    1.3       Major Products and Services ........................................................................................................................... 7
2     Analysis of Key Performance Indicators ............................................................................................... 8
    2.1       Five Year Snapshot: Overview of Financial and Operational Performance Indicators ....................................... 8
    2.2       Key Financial Performance Indicators ............................................................................................................ 11
      2.2.1       Revenue and Operating Profit.................................................................................................................... 11
      2.2.2       Asset and Liabilities ................................................................................................................................... 12
      2.2.3       Net Debt vs. Gearing Ratio ........................................................................................................................ 13
      2.2.4       Operational Efficiency ................................................................................................................................ 14
      2.2.5       Solvency ................................................................................................................................................... 15
      2.2.6       Valuation ................................................................................................................................................... 16
    2.3       Competitive Benchmarking ............................................................................................................................ 17
      2.3.1       Market Capitalization ................................................................................................................................. 18
      2.3.2       Efficiency................................................................................................................................................... 19
      2.3.3       Turnover – Inventory and Asset ................................................................................................................. 20
      2.3.4       Liquidity..................................................................................................................................................... 21
3     Mergers & Acquisitions and Partnerships ........................................................................................... 22
    3.1       M&A and Partnerships Strategy ...................................................................................................................
								
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