Why Read?

• Understand the background behind OHL’s challenging 2018 and the precipitous drop in bond price
• Understand the impact of cost over-runs and contract review on cash flows
• Understand the possibility of successful claims against OHL’s customers
• Understand valuation of OHL’s real estate development projects and importance for OHL liquidity and valuation going forward
• Understand the working capital cycle and how it impacts FCF generation
• Understand catalysts and risks for the long thesis
• Understand mitigants to these risks
• Understand options available to the company in order to meet bond maturities
• Understand OHL’s sensitivity to regional EBITDA margins, working capital, new orders and cost of capital in terms of equity cushion and valuation and debt coverage.
• Understand the real estate developments business within OHL

What’s New?

• Assessment of value within OHL’s real estate development projects
• Assessment of OHL’s available liquidity (with and without current financial assets in escrow and cash in temporary subsidiaries) and projection thereof
• DCF valuation of OHL using its high cost of equity
• Valuation sensitivity analysis – impact of regional EBITDA margins, working capital, new orders and cost of capital

Questions Answered

• What is our base case and sensitised valuation of OHL?
• Can OHL generate sufficient FCF to meet bond maturities in 2020, 2022 and 2023?
• How much equity upside is there and how does this break out between the current net cash position, real estate development and improvement in the core construction business?