Wednesday, June 15, 2016

5 reasons why Cityneon is set for 'explosive growth': DBS

DBS Group Research is sticking to its ‘buy’ call for Cityneon Holdings, with a target price of $1.05.

The research house has also raised earnings forecast for FY16 and FY17 by 11% and 4% respectively to incorporate contribution from the Singapore set.

Cityneon currently has Intellectual Property (IP) rights for 2 Walt Disney franchises: Transformers and The Avengers. It has two permanent sets in Las Vegas and two travelling sets.

According to a Thursday report, DBS believes that Cityneon has upside for “explosive growth” ahead for the following reasons:

Expanding project pipeline
Victory Hills Exhibition (VHE), a wholly-owned subsidiary of Cityneon, has targeted launching Transformers in Las Vegas and China by end-2016. The company also intends to launch the franchise in the Middle East, rest of Asia and parts of China in 2017.

The Avengers exhibition, on the other hand, is expected to travel to Taiwan, Middle East, Sweden and other parts of Europe in 2017 following its tours in New York, Seoul and Paris.

With a strong pipeline of Avengers and Transformers movies stretching to 2020, visitor numbers to these exhibitions is expected to perform well.

Moreover, with no limits on locations for its IP rights, VHE can organise exhibitions in any part of the world with the two existing franchises. This offers “vast opportunities” for VHE, the report added.

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