TH Unique Engineering Initiation 0411

Initiating Coverage, 11 April 2014
Unique Engineering & Construction (UNIQ TB)
Buy
Engineering & Construction

Market Cap: USD167m
Target Price:
Price:
THB9.00
THB6.90
Macro
Risks
Thailands Next Major Contractor
Growth
Value

Relative to Stock Exchange of Thailand Index (RHS)
173
11.3
162
10.3
150
9.3
139
8.3
127
7.3
116
6.3
104
5.3
100
90
80
70
60
50
40
30
20
10
93
Feb-14
Dec-13
Oct-13
Aug-13
Jun-13
Source: Bloomberg
Avg Turnover (THB/USD)

Cons. Upside (%)
Upside (%)
52-wk Price low/high (THB)
Free float (%)
9.81m/0.30m
30.4
30.4
5.90 - 11.4
45
Shareholders (%)
Mr. Kreangsak
Suviwattanachai
Mr. Wanchai Punwichien
THAI NVDR
35.8
8.9
6.7
Shariah compliant
Strong orderbook and record-high earnings. As at end-2013, Unique

Engineering & Construction (Unique)s orderbook was at its record-high
THB30bn, accounting for three years of the companys construction
revenue. This was a result of MRT Red Line Contract 1, which
accounted for 83% of its orderbook. Moreover, its sale orderbook ratio of
4.4x as at end-2013 was higher than the sectors average 2-3x. Core
earnings are forecast to jump 13% y-o-y to THB663m in FY14, and go
up by 24% y-o-y to THB821m in FY15. We believe the current political
stalemate has had minimal impact on our earnings forecast as Unique
has already signed on and secured 83% of our forecast revenue.
UNIQ Foundation, UNIQ Tunneling to be floated. Uniques
management informed us that it expects its subsidiaries, UNIQ
Foundation and UNIQ Tunneling, to be listed on the stock market in the
next few years. A back-of-the-envelope calculation puts the total entity
value of its two subsidiaries at c. THB300-500m, depending on market
valuations and sentiment at the time of listing.
Potential capital increase. Apart from listing its subsidiaries, the
company expects to increase its capital from THB780m (par value
THB1/share) to THB1bn (par value THB1/share), which will enable it to
bid for larger projects going forward. The capital increase implies a
potential dilution of 28% in its shares. However, the details, timing and
pricing of the capital increase remain uncertain.
Initiate with BUY. Given the companys strong orderbook and a long
list of potential projects, we recommend that investors accumulate the
stock on any price weakness. We initiate coverage with a BUY call and
THB9.00 TP, pegged to a FY14F P/E of 10.5x, and at a 25% discount to
the stocks 5-year mean P/E.
Forecasts and Valuations
Dec-11
Dec-12
Dec-13
Dec-14F
Dec-15F
4,313
4,014
6,715
10,619
14,047
Reported net profit (THBm)
123
(228)
587
663
821
Recurring net profit (THBm)
123
(228)
587
663
821
(17.4)
(286.4)
12.9
23.9
Recurring EPS (THB)
0.20
(0.35)
0.81
0.85
1.05
DPS (THB)
0.06
0.00
0.06
0.16
0.21
Kannika Siamwalla, CFA 66 2862 9744

License No.23517
Recurring P/E (x)
35.2
8.5
8.1
6.6
P/B (x)
2.75
2.24
2.07
1.71
1.42
kannika.si@rhbgroup.com
P/CF (x)
5.7
27.2
3.7
4.4
5.2
Dividend Yield (%)
0.9
0.0
0.9
2.3
3.1
Chun Phokaisawan +66 2862 2029
EV/EBITDA (x)
9.6
43.2
5.8
4.5
3.7
chun.ph@rhbgroup.com
Return on average equity (%)
7.8
(12.6)
25.1
23.1
23.7
66.7
44.7
87.8
76.3
53.4
0.0
0.0
Total turnover (THBm)
Recurring net profit growth (%)
Net debt to equity (%)

Our vs consensus EPS (%)
na
na
Source: Company data, RHB estimates
See important disclosures at the end of this report
.
2
0
.
3
0
0
.
3
0
0
We initiate coverage on Unique with BUY and THB9.00/share TP, based .
0
on a 10.5x FY14 P/E. We like its strong order book, which could boost 0
earnings by 13% y-o-y to THB663m in FY14 and 24% y-o-y to THB821m 0
in FY15. Once market sentiment turns favorable, Unique plans to list its
two subsidiaries, UNIQ Foundation and UNIQ Tunneling, as well as
increase its capital. This will enable it to bid for larger projects going
forward.
Apr-13
Vol m
Price Close
12.3
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11 April 2014
Table Of Contents
Valuation And Recommendation
Shareholder Structure
Core Business and Competition
Current And Future Projects
Financial Analysis
10

11 April 2014
Valuation And Recommendation

Our
TP of THB9.00 is based on a FY14F

10.5x P/E, which is at a 25% discount to its 5year mean P/E, and provides an upside of
28%.
Due to the current political stalemate, Uniques share price has fallen closer to our
distressed valuation of THB6.40 (around its 5-year mean P/E). At this price, we
believe the share has already factored in most of the downside from the potential
delays in government projects.
We believe the counter can trade at a premium again after the political situation
shows signs of resolution. We value it at THB9.00/share based on P/E valuation. Our
THB9.00 TP is pegged to a P/E of 10.5x, which is at a 25% discount to its 5-year
trailing 12-month mean P/E. We deem this a reasonable multiple given: i) its smaller
size (small cap), ii) low liquidity in the stock and iii) under-owned stock as there is no
analyst coverage. However, we expect the company to continue receiving larger
government infrastructure projects as we enter into what we believe to be the peak of
Thailands construction/investment cycle over the next five years.
The current political stalemate has little bearing on our earnings forecast as we only
include the projects on hand, which will be Uniques key earnings driver over the next
2-3 years.
As at end of 2013, Uniques sale orderbook ratio stood at 4.4x, which is the highest
among its competitors. Given its current strong orderbook and a long list of future
potential projects, we recommend accumulating the stock on share price weakness.
We initiate our coverage with a BUY recommendation and a TP of THB 9.00/share.
Figure 1: Trailing 12-month P/E band chart
(x)
At the current price, the stock is trading at
45
near-distressed valuations.
35
+2 sd: 28.1x
25
+1 sd: 21.1x
Mean: 14.1x
15
-1 sd: 7.1x
Mar-08
-5
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
Mar-14
Source: Bloomberg, RHB estimates
Figure 2: Contractors sale orderbook ratios

(X)
6
As at end-
, Uniques sale orderbook

ratio of 4.4x was the highest among its
competitors.
5
4
3
2
1
0
UNIQ
CK
STEC

11 April 2014
By sector comparison, Unique trades at a lower P/E, P/BV and EV/EBITDA. It

provides a dividend yield of 2.3%, which is in line with the sector average of 2.2%.
Uniques ROE at 21% is one of the highest among its peers, compared with the
sectors average 13.5%.
Figure 3: Peer comparison
P/E
Company
CK
STEC
ITD
UNIQ
Average
2014F
28.3
17.1
24.6
8.2
19.6
2015F
21.9
15.9
20.4
6.6
16.2
P/BV
2014F
1.7
3.2
1.4
1.7
2.1
2015F
1.6
2.9
1.4
1.4
1.8
EV/EBITDA
2014F
2015F
18.6
17.0
8.5
7.9
9.2
8.6
4.9
4.0
10.3
9.4
Div yield (%)

2014F
2015F
1.7
1.8
3.1
3.2
1.7
1.3
2.3
3.0
2.2
2.3
ROE (%)
2014F
2015F
6.6
7.6
19.6
19.7
6.5
7.4
21.1
21.6
13.5
14.1
Source: Bloomberg
The company expects potential IPOs of its
Unique expects to list two of its subsidiaries, UNIQ Foundation (a bored piling
company) and UNIQ Tunneling (a pipe jacking company) within the next few years.
two subsidiaries, UNIQ Foundation and UNIQ
Currently, UNIQ Foundation and UNIQ Tunneling account for 4 % and 1% of the
Tunneling.
companys construction revenue respectively. The company currently holds 99.9% of
the shares in each subsidiary. Based on the current market valuations for Thai
construction companies in general, a back-of-the envelope calculation puts the listing
of the two companies in the range of THB300-500m based on 8x P/E on the
subsidiaries earnings, depending on market valuation sentiment at the time of listing.
We have not included this in our valuation as details regarding the listing of the two
companies remain uncertain at the moment.
Meanwhile, Unique also expects to increase its capital from THB780m (par
THB1/share) to THB1bn (par THB1/share), which will enable it to bid for larger
projects going forward. The capital increase implies a potential share dilution of 28%.
The details, timing and pricing of the capital increase remain uncertain at the
moment.

11 April 2014
Shareholders Structure
Mr. Kreangsak Suviwattanachai, CEO of the
company, is Uniques major shareholder. We

believe the chairman of the company, Mr.
Natee Panichewa, is well connected.
The major shareholder of Unique is Mr Kreangsak Suviwattanachai (35.7%), CEO of

the company, while 10% of the shares are owned by Mr Wanchai Punwichien. We
believe that it is the chairman of the company, Mr Natee Panichewa, who has the
strong business network that will allow the company to receive more construction
projects going forward. Panichewas family has strong business networks with many
reputable families in Thailand and engages in many businesses such as property
development, logistic, insurance, and construction. Currently, all of the companys
customers are government agencies and state enterprises. The companys past
projects include SRT Commuter Train Project Bang Sue- Taling Chan, Industrial Ring
Road, Contract 3 and The Ramintra Outer Bangkok Ring Road Expressway, Contract
1.
Figure 4: Shareholder structure as of December 2013
Source: Company data
Figure 5: Uniques target customers

11 April 2014
Core Business And Competition

Unique is one of the most profitable
contractors in Thailand with a normalised
gross margin of 15%.
Unique is a general construction company with expertise in medium-large scale

infrastructure projects (ie roads, bridge, underpass and mass transit). The company
mainly services public sector customers as the main contractor, sub-contractor, and
consortium member. The company is one of the most profitable contractors in the
industry. Its gross profit margin stood at 19% in 2013 while sector average was at
around 1 %. This is mainly due to Uniques strength in using advanced technology in
its construction projects and its ability to control cost effectively.
Figure 6: Uniques past projects
Figure 7: Uniques gross margin compared with other contractors
(%)
20
18
16
14
12
10
8
6
4
2
UNIQ
CK
STEC
Source: Company data, RHB estimate
Unique is one of the smaller players in

the industry, with 5% of the market
share
Currently, the construction industry in Thailand has an estimated total value of

around THB1trn. We expect competition in the industry to be relatively high in FY14
as many government projects could potentially be delayed due to the current political
stalemate. Most construction projects are awarded through contract bidding process.
Project owners often select contractors based on: i) the contractors experience, ii)
quality of the contractors work, iii) the contractors financial capabilities and iv)
bidding price.

11 April 2014
Domestically, there are currently three major competitors who are qualified bidders
for large-scale construction projects, namely Italian-Thai Development (ITD TB, NR),
Sino Thai Engineering & Construction (STEC TB, BUY, TP: THB20.00) and CH
Karnchang (CK TB, BUY, TP: THB18.30). CH Karnchang has around 20-25% market
shares in the construction industry while Italian-Thai and Sino Thai Engineering hold
around 28% and 15% respectively in the industry respectively. Unique is one of the
smaller players with a 5% market share. The international competitors include
construction companies from Japan, China and Europe such as Kajima Corporation
(1812 JP, NR), Obayashi Corporation (1802 JP, NR), Siemens (SIE GR, NR) and
Bilfinger (GBF GR, NR) which will more likely enter as JV partners with the locals
and serve as technology providers.
Figure 8: Market share in the industry
CK
23%
Others
29%
UNIQ
5%
STEC
15%
ITD
28%

11 April 2014
Current And Future Projects
cts
Uniques orderbook jumped significantly in
2013 as a result of MRT Red Line Contract
, which make up % of the companys
current orderbook.
Current orderbook
Uniques orderbook jumped significantly in 2011 and 2013 as a result of two major
projects signed the Blue Line Extension Project Contract 3 (THB11.8bn) and MRT
Red Line Contract 1 (THB29.8bn).
As at end-2
, the companys orderbook was at a record high THB30bn, accounting
for three years of the companys construction revenue. This was a result of MRT Red
Line Contract 1, which accounted for 83% of its orderbook.
The company records sales revenue by percentage of completion. MRT Red Line
Contract 1 and Blue Line Extension Project Contract 3 should allow the company to
book sales totaling THB29bn over the next three years. We forecast a FY14 revenue
of THB10bn, with MRT Red Line Contract 1 and Blue Line Extension Project Contract
3 accounting for 80% and 16% respectively.
Figure 9: Uniques rising orderbook

(THB bn)
35
30
30
26
25
20
16
15
12
9
10
6
5
7
4
0
2014F
Figure 10: Companys orderbook as at end of FY13

Active projects
Project value
(THB bn)
Remaining Value
(THB bn)
Red Line Contract 1 Bang Sue Grand Station
30
25
Blue Line Contract 3 Tao pun-Tha Phra contract 3
12
n.a.
Others
Potential projects in 2014
The company will submit its bids for Dark

Green Line MRTA and Suvarnabhumi
Airport Phase II projects this month and
July, respectively
In 2014, Unique plans to bid for Dark Green Line MRTA (Saphan Mai- Ku Kott)
project worth THB26bn, two double-track projects worth THB10bn, and
Suvarnabhumi Airport Phase II project worth THB48bn. Given its historical track
record, we believe it will win at least 5% or c. THB5bn of the total bidding project
value in 2014, which in turn, should support Uniques earnings during 2015-2018.
The company will submit its bids for Dark Green Line MRTA and Suvarnabhumi
Phase II projects in April and July respectively. We expect the bidding outcome for
both projects to be announced in August-October.
Note that for Dark Green Line MRTA, government approval will be required after the
bidding outcome. However, Suvarnabhumi Airport Phase II project does not require
cabinet approval since it was already approved by the cabinet and the National
Economic and Social Development Board in 2010.

11 April 2014
Figure 11: Bidding projects in 2014

Project Bidding in 2014
MRT: Dark Green Line
Double Track
Suvarnabhumi Airport
(Phase II)
Value
(THBm)
Contract 1: Mo chit-Saphan Mai Section
14,021
Contract 2: Saphan Mai-Ku Kott Section
6,126
Contract 3: Depot and Park&Ride Facilities
3,709
Contract 4: Trackworks
Contract 1: Double Track (Cha Choeng Sao - Wihan
Daeng), Chord Lines
Contract 2: Double Track (Wihan Daeng - Buu Yai
Section), Railway Tunnel
Contract 1: Extension on the west-side of the existing
Passenger Terminal Building
2,609
10,184
621
39,046
Contract 2: Construction of Midfield Satellite Terminal
7,087
Contract 3: System design and construction of utilities
2,565
Total Value
85,968

11 April 2014
Financial Analysis
Construction revenue to grow by 58%
y-o-y in 2014, supported by revenue
recognition from MRT Red Line Contract 1.
Construction revenue declined 6.8% y-o-y to THB4.0bn in FY12 from THB4.3bn in

FY11 due to the severe floods in 4QFY11, which disrupted the construction of Red
Line Bang Sue-Taling Chan and MRT Blue Line Hua Lamphong-Bang Khae.
However, construction revenue surged 67% y-o-y to THB6.7bn in FY13 as the
company recognised revenue from the construction of MRT Blue Line Hua
Lamphong-Bang Khae and Pattanakarn-Onuch Interchange projects.
We expect Unique to report construction revenue of THB10bn (+58% y-o-y) in 2014,
and THB14bn (+32% y-o-y) in 2015. The significant revenue increase will be driven
mainly by revenue recognition from MRT Red Line Contract 1 and Blue Line
Extension Contract 3 projects. Revenue from MRT Red Line Contract 1 and Blue
Line Extension Contract 3 projects will account for 96% and 97% of our total turnover
forecasts in FY14 and FY15 respectively.
Figure 12: Uniques rising sales growth
(THB bn)
16
14
12
10
8
6
4
2
0
2014F
2015F
(2)
Revenue
EBITDA
Net income (Ex. EI)
Gross profit margin is expected to decline to a

a normalised 15-16% level in FY14 as we
expect lower trade discounts.
Gross profit margin jumped to 19% in FY13 from 10% in FY12. This was mainly due
to a trade discount in construction material and machinery, which was the result of
heavy working capital investment in MRT Red Line Contract 1 and Blue Line
Extension Contract 3 projects. We forecast gross profit margin to decline to its
normalised level of 15-16% in FY14 and FY15. Additionally, cement and steel prices
are expected to remain stable in FY14. In anticipation of the passing of the THB2trn
Infrastructure Bill in FY13, the producers overproduced construction materials,
resulting in an oversupply.
Figure 13: Earnings outlook
(%)
25
20
15
10
5
0
2014F
2015F
-5
-10
Gross margin
EBITDA margin
Net margin (Ex. EI)
10

11 April 2014
The current political stalemate has

minimal impact on our forecasts.
Core earnings are expected to come in at THB 663m (13% y-o-y) in FY14 and THB
821m (24% y-o-y) in FY15. We believe the current political stalemate has minimal
impact on our earnings forecast as Unique has already signed and secured most of
the revenue from MRT Red Line Contract 1 and Blue Line Extension Contract 3
projects in FY14. There is limited downside risk to our earnings forecast.
Figure 14: Interest bearing debt and financial debt
(THB bn)
(x)
2.0
1.8
1.6
3
1.4
1.2
1.0
0.8
0.6
0.4
1
0.2
0.0
2014F
Financial Debt (LHS)
2015F
Interest bearing D/E (RHS)
Debt-to-Equity (D/E) ratio is within the

industry average.
The companys interest bearing debt increased significantly to 1.1x in 2013 from 0.5x
in 2012 as a result of significant investment in construction equipment and machinery
for MRT Red Line Contract 1 and Blue Line Extension Contract 3 projects. However,
Uniques current interest bearing ratio of 1.1x is still relatively low compared with the
sector average of more than 2x. Moreover, its interest coverage ratio was at 6.2x in
FY13, compared with 3x in FY11. We are confident that the company will be able to
repay its debts and be ready for new projects.
We expect Uniques interest bearing debt-to-equity (D/E) ratio to decline slightly to
1.0x and 0.8x in FY14 and FY15 as the company will repay its debts after the
completion of the Blue Line Extension Contract 3 project. Note that most of its debts
are short-term project financing, which will be fully repaid after the completion of the
projects. At the moment, we believe that the company is not likely to make any
significant investment in construction machinery since it has already invested in
major construction machinery and equipment for current and future potential projects
in FY13.
Interest-bearing D/E to decline slightly to

1.0x in FY14 as the company pays back its
debt after the Blue Line Extension
Contract 3 project has been completed.
The companys cash flow from operations is expected to be positive and remain at
the same level in FY14 and FY15 as it continues to recognise revenue from the
construction of Red Line Contract 1 project. Capital expenditure is expected to be
minimal in FY14 and FY15 since the company has already invested in major
construction machinery and equipment in FY13. Hence, we believe the company can
generate enough cash internally to finance its projects in FY14 and FY15.
Figure 15: Uniques cash flow
2011
2012
2013
2014F
2015F
CFO
759
164
1,365
1,214
1,033
CFI
(521)
(232)
(2,915)
(1,200)
(500)
FCF
404
(51)
(1,338)
14
533
CFF
(513)
19
1,762
171
(353)
196
147
359
544
724
Ending cash
11

11 April 2014
Financial Exhibits
Profit & Loss (THBm)
Dec-11
Dec-12
Dec-13
Dec-14F
Total turnover
4,313
4,014
6,715
10,619
14,047
Cost of sales
(3,664)
(3,608)
(5,437)
(8,920)
(11,940)
1,279
1,699
2,107
Gross profit
Dec-15F
649
406
(370)
(479)
(484)
(690)
Other operating costs
(19)
(18)
(21)
(22)
Operating profit
260
(91)
773
987
1,172
1,103
1,550
1,787
Gen & admin expenses
Operating EBITDA
Depreciation of fixed assets
Operating EBIT
Other recurring income
448
106
(188)
(197)
(330)
(563)
260
(91)
773
987
(913)
(23)
(616)
1,172
22
19
99
53
70
Interest expense
(92)
(76)
(140)
(212)
(216)
Pre-tax profit
190
(148)
732
828
Taxation
(67)
(80)
(146)
(166)
(0)
(0)
(0)
(0)
Minority interests
1,026
(205)
(0)
Profit after tax & minorities
123
(228)
587
663
821
Reported net profit
123
(228)
587
663
821
Recurring net profit
123
(228)
587
663
821
Cash flow (THBm)
Dec-13
Dec-14F
Dec-15F
Operating profit
Dec-11
260
Dec-12
(91)
773
987
1,172
Depreciation & amortisation
188
197
330
563
616
Change in working capital
335
(98)
509
52
(345)
Other operating cash flow
136
313
38
Operating cash flow
919
320
1,651
Interest paid
(92)
(76)
(140)
(212)
Tax paid
(67)
(80)
(146)
(166)
Cash flow from operations
759
164
1,365
1,214
Capex
(355)
(215)
(2,703)
(1,200)
Other investing cash flow
(165)
(18)
(211)
Cash flow from investing activities
(521)
(232)
(2,915)
(1,200)
(500)
(125)
(164)
Dividends paid
(38)
(47)
Proceeds from issue of shares
(37)
191
(439)
(172)
1,808
Increase in debt
Other financing cash flow
Cash flow from financing activities
Cash at beginning of period
Total cash generated
Implied cash at end of period
(0)
(11)
1,591
(0)
296
-
12
1,454
(216)
(205)
1,033
(500)
-
(188)
-
(513)
19
1,762
171
(353)
470
196
147
359
544
(274)
(49)
212
185
180
196
147
359
544
724
12

11 April 2014
Financial Exhibits
Balance Sheet (THBm)
Dec-11
Dec-12
Dec-13
Dec-14F
196
147
592
776
957
Inventories
1,337
542
556
892
1,433
Accounts receivable
1,974
3,372
6,713
9,663
12,783
Other current assets
550
290
479
584
773
4,057
4,351
8,339
11,915
15,945
Total cash and equivalents
Total current assets

Total investments
Tangible fixed assets
Dec-15F
382
360
394
467
501
1,219
1,368
3,753
4,390
4,274
Intangible assets
Total other assets
44
80
126
190
248
Total non-current assets
1,648
1,812
4,278
5,051
5,028
Total assets
5,705
6,163
12,617
16,967
20,973
Short-term debt
766
687
1,478
1,694
1,468
Accounts payable
1,648
1,706
3,223
4,460
5,970
Other current liabilities
1,121
1,186
3,773
6,081
8,094
Total current liabilities
3,534
3,579
8,473
12,235
15,532
Total long-term debt
476
382
1,400
1,480
1,517
Other liabilities
126
137
139
110
125
Total non-current liabilities
603
519
1,540
1,590
1,642
17,174
Total liabilities
4,137
4,098
10,013
13,824
Share capital
671
780
780
780
780
Retained earnings reserve
803
1,191
1,731
2,269
2,925
Other reserves
94
94
94
94
94
1,568
2,064
2,604
3,142
3,799
Minority interests
Other equity
(0)
Total equity
1,569
2,064
2,604
3,142
3,799
Total liabilities & equity
5,705
6,163
12,617
16,967
20,973
Dec-11
Dec-12
Dec-13
Dec-14F
Dec-15F
14.5
(6.9)
67.3
58.1
32.3
Operating profit growth (%)
(16.5)
(135.1)
0.0
27.6
18.7
Net profit growth (%)
(17.4)
(286.4)
0.0
12.9
23.9
EPS growth (%)
(17.4)
(279.8)
0.0
5.1
23.9
(0.8)
22.6
8.6
20.7
20.9
Operating margin (%)
6.0
(2.3)
11.5
9.3
8.3
Net profit margin (%)
2.8
(5.7)
8.7
6.2
5.8
Return on average assets (%)
2.2
(3.8)
6.2
4.5
4.3
Return on average equity (%)
7.8
(12.6)
25.1
23.1
23.7
Net debt to equity (%)
66.7
44.7
87.8
76.3
53.4
DPS
0.06
0.00
0.06
0.16
0.21
Recurrent cash flow per share
1.21
0.25
1.88
1.56
1.33
Shareholders' equity
Key Ratios (THB)

Revenue growth (%)
Bv per share growth (%)
13

11 April 2014
SWOT Analysis
One of the leading contractors in Thailand
Political
impasse which
could potentially
delay
construction
projects
Healthy orderbook of THB30bn, accounting for three

years of current construction revenue
Competition
from
international
contractors
Bidding for
MRTA Dark
Green Line
project in April
Bidding for
Suvarnabhumi
Airport Phase II
project in July
Reliance on government projects

Weak economy could slow down private spending
P/E (x) vs EPS growth
P/BV (x) vs ROAE
1,950%
120
1,600%
100
1,250%
20
-150%
-500%
P/E (x) (lhs)
Jan-15
200%
Jan-14
550%
40
Jan-13
60
Jan-12
900%
Jan-11
80
EPS growth (rhs)
2.5
23%
2.0
15%
1.5
8%
1.0
0%
0.5
-8%
0.0
-15%
P/B (x) (lhs)
Jan-15
2,300%
140
30%
Jan-14
160
3.0
Jan-13
2,650%
Jan-12
3,000%
180
Jan-11
200
Return on average equity (rhs)
Company Profile
Unique is one of the leading construction companies in Thailand. The company's expertise lies in the construction of medium to large
public utility construction which requires expertise in the management of projects and advanced technologies.
14

11 April 2014
Recommendation Chart
Price Close
13
11
9
7
5
3
1
Apr-09
Jul-10
Oct-11
Jan-13
Source: RHB estimates, Bloomberg

Date
Recommendation
Target Price Price
2014-04-10
Source : RHB estimates, Bloomberg
15
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Initiating Coverage, 11 April 2014

Unique Engineering & Construction (UNIQ TB)

Engineering & Construction

Thailands Next Major Contractor

Unique Engineering & Construction (UNIQ TB)

Avg Turnover (THB/USD)

Strong orderbook and record-high earnings. As at end-2013, Unique

Forecasts and Valuations

Reported net profit (THBm)

Recurring net profit (THBm)

Recurring EPS (THB)

Kannika Siamwalla, CFA 66 2862 9744

Recurring P/E (x)

Dividend Yield (%)

Chun Phokaisawan +66 2862 2029

Return on average equity (%)

Total turnover (THBm)

Recurring net profit growth (%)

Net debt to equity (%)

Source: Company data, RHB estimates

See important disclosures at the end of this report

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Unique Engineering & Construction (UNIQ TB)

Core Business and Competition

Current And Future Projects

See important disclosures at the end of this report

Unique Engineering & Construction (UNIQ TB)

Valuation And Recommendation

TP of THB9.00 is based on a FY14F

At the current price, the stock is trading at

Source: Bloomberg, RHB estimates

Figure 2: Contractors sale orderbook ratios

, Uniques sale orderbook

Source: Company data, RHB estimates

See important disclosures at the end of this report

Unique Engineering & Construction (UNIQ TB)

By sector comparison, Unique trades at a lower P/E, P/BV and EV/EBITDA. It

Div yield (%)

The company expects potential IPOs of its

See important disclosures at the end of this report

Unique Engineering & Construction (UNIQ TB)

company, is Uniques major shareholder. We

The major shareholder of Unique is Mr Kreangsak Suviwattanachai (35.7%), CEO of

Source: Company data

Figure 5: Uniques target customers

Source: Company data

See important disclosures at the end of this report

Unique Engineering & Construction (UNIQ TB)

Core Business And Competition

Unique is a general construction company with expertise in medium-large scale

Source: Company data

Figure 7: Uniques gross margin compared with other contractors

Source: Company data, RHB estimate

Unique is one of the smaller players in

See important disclosures at the end of this report

Currently, the construction industry in Thailand has an estimated total value of

Unique Engineering & Construction (UNIQ TB)

Source: Company data, RHB estimates

See important disclosures at the end of this report

Unique Engineering & Construction (UNIQ TB)

Current And Future Projects

Figure 9: Uniques rising orderbook

Source: Company data, RHB estimates