Tat Hong was set up in Singapore in the 70s as a supplier of cranes and heavy equipment. Over the years, the company has grown and progressed to become one of the biggest companies in the region supplying cranes and heavy equipments for the industry. The group is principally involved in the rental and sales of cranes and the sale of spare parts for cranes. Apart from cranes, the group is also involved in the rental and sale of other ancillary heavy equipments such as evacuators, bulldozers, earth-moving equipment, pilling rigs and generators.Tat Hong has exclusive distributorship agreements for cranes and other heavy equipment (such as excavators, compaction equipment, wheel-loaders, skid-loaders, graders, etc.)
with Hitachi-Sumitomo, Mustang, Yanmar, Kawasaki, Bomag, Mitsubishi, Kato. Tat Hong is on track to achieve their 3-Year target (FY2006 – FY2008)- net profit growth averaging 25% p.a.
Over the past three decades, Tat Hong had expanded their operations to Malaysia, Hong Kong, Thailand, Indonesia, China, Japan, Vietnam and Australia, allowing them to bring their services closer and more effectively to our customers.In the annual survey conducted by UK-based publisher 'International Cranes.' Tat Hong was ranked the world's ninth largest crawler cranes company in the years 2003 and 2004. In Asia, its ranked second largest in 2003 and 2004. Tat Hong is currently number one player in the world in terms of crawler cranes, and ranked eighth in the world in terms of tonnage, said cheif executive officer Roland Ng.
It's projects have included, among others, projects for the Bugis, Yew Tee, and Marina Bay MRT stations, the Singapore-Malaysia second link, the NorthBridge Tunnel in Sydney, projects for Mass Transit Railway in Hong Kong, and Sanat Kita power plant in Philippines. Tat Hong continues to benefit from the industry's healthy long-term prospects. It is estimated that non-Japan Asia has the world's fastest growing construction industry over the long term, while infrastructure investment requirements for East Asia are expected to rise to around US$12 billion annually over the next five years.
The growth in the number of new infrastructure and oil and gas projects in the Asia Pacific region, coupled with the continuing tight supply of cranes globally, should keep demand buoyant and drive further increases in rental rates, utilization rates and the prices of both new and used equipment. Given their regional presence and available stock, Tat Hong is in a prime position to participate in the continued development of new infrastructure and oil and gas projects in the Asia Pacific region.
In Australia, the ongoing infrastructure and project growth is also expected to continue in coming years. Following our recent acquisition of Kingston Industries, Tat Hong will benefit from a larger equipment rental fleet and wider customer base. As such, we believe Australia will continue to contribute significantly to the Group's performance. Two structured mining equipment rental contracts in Indonesia are expected to turn in increased contributions to the Group's bottom line from the current financial year.
The recent listing of Tat Hong's Australian business Tutt Bryant on the Austrialian Stock Exchange has a positive effect on its operations. Post-ipo Tat Hong will still control 70 percent of Tutt Bryant. The money raised from the IPO will help Tat Hong reduce its debt ratio, free it from future obligations to fund the Australian operations and increase the chances of giving out special dividends to shareholders.Tutt Brayants’s share price performed well on its debut , closing at A$1.23 or 23.0% above its issue price, with a high volume of 4.5 million shares traded. The highest traded price for the day is A$1.25. Tutt Bryant closing price as of 13/01/2006 was AU$1.290 from its ipo price of AU$1.00.
Extracted from their announcements, financial facts and figures below.
http://www.listedcompany.com/ir/tathong/newsroom/Presentation141105.pdf
Healthy Financial Ratios with increasing ROE. 
Price reached recent new highs. 
12 years Group Revenue - Recovering from construction inactivity.
Quoting a recent news article .
Title : Construction sector seen picking up, firms urged to expand overseas
By : Jeana Wong, Channel NewsAsia
Date : 12 Jan 2006 1823 hrs (GMT + 8hrs)
SINGAPORE : Singapore's construction industry is cautiously optimistic about its outlook, even if the sector has just given its best showing in five years.
At an industry seminar on Thursday, industry players said there is no doubt that the sector is picking up.
But they added that local firms must tap overseas markets such as India and the Middle East for growth.
Singapore's construction sector expects to win up to S$13.5 billion worth of contracts this year.
That is about 20 percent more than last year.
It will put the industry on track for another good year, but that is still only about half of the value reached during the peak in 1997.
With the sector's contribution to national GDP stagnant at around 5 percent, industry leaders are urging local players to expand overseas.
William Tan, Business Development Director, Building and Construction Authority, said, "Although our local market (has) so-called recovered slightly, it's still far away from our peak year of say, 1997, where we saw $24 billion type of value...It is important for our firms to venture overseas so that they can supplement the limited domestic market."
And they see the need for Singapore companies to hurry.
Mr Tan said, "We're already late in the Middle Eastern market. However, there are countries that are also playing catch-up in the Middle East like Qatar and Abu-Dhabi. So timing wise in that aspect, it'll be just nice. And our firms of course have to work harder and to catch up and make our presence felt by the people there."
Industry players say local firms can play to Singapore's proven track record in township planning, environmental technologies and mechanical and electrical services.
The Building and Construction Authority highlighted India as one potential market.
It says there is growing demand in India's middle class for better housing and infrastructure, and that recent policy changes there have created a ready mortgage market.
Koh Lin Ji, International Operations Director, Building and Construction Authority, said, "Interest (rates) have fallen to about 9-11 percent and the other reason is that government (is) encouraging home ownership. For houses smaller than 1,500 square feet, the government actually provide rebates on interest paid on mortgage...For the Indian market, they have very large contractors and a lot of smaller contractors so they have a gap. And this gap will be filled up by our large contractor firms."
Other markets seen as key to the industry include China and Southeast Asia. - CNA/ms
Tighter demand-supply imbalance will further raise prices
and crane rental rates of Tat Hong’s fleet of cranes,
continuing to fuel a positive operating environment for Tat
Hong. Numerous infrastructure projects and tight supply of
cranes will continue to push up
• Utilisation rates
• Rental rates
• Prices of both new and used equipment
Upcoming major infrastructure projects in Singapore:
- Two IR projects (approx. S$5 billion)
- Circle Line (approx. S$6.7 billion)
- Sports Hub (approx. S$650 million)
- New Finance Center
• Spending on construction projects in Australia estimated at
US$168.4 billion for 2006 - 2008 (Source: Global Insight Inc.)
• Spending on construction projects in Thailand estimated to be
US$16b – US$18b over next 5 years, with average 5.8% GDP
growth over next 3 years (Source: Asian Development Outlook,
2005)
• Average 8.5% GDP growth for Vietnam over next 3 years, with
estimated S$13.3 billion investment in infrastructure projects in
2005 alone (Source: BCI Asia)
Assuming that Tat Hong achieves 25% growth with a 5% discount (US Treasury rates) and zero terminal value. I used last years figures and not prediction forecast.
Using DCF discount model. 
Today's share price of 0.705 is approximately 56% undervalued from the rough estimate of intrinsic business value.
Please read the prospectus and perform your analysis before making any investment decision. The above does not constitute a recommendation to apply for this company. I will not be liable for any losses incurred by anyone who invests based solely on the above-mentioned information.