OKP Holdings

[Terry]

Okp is awarded Contract because they low bidder.
This project Okp is 25% below 2nd lowest bidder and 50% below 3 & 4 lowest bidder.

[Ray168]

Okp is awarded Contract because they low bidder.
This project Okp is 25% below 2nd lowest bidder and 50% below 3 & 4 lowest bidder.

Low bid due to poor quality and safety record?

Is it true to LTA has 2 tier bidding system? 

https://www.allsingaporestuff.com/articl...astructure

[karlmarx]

It is still early days.

A lengthy investigation will be conducted to determine the cause of the accident, and the parties at fault. Any fines to be paid should be manageable. Extra resources placed into re-constructing the highway could be significant but will not affect more than 1 quarter's earnings. But the biggest potential impact is OKP's ability to win future work.

After the investigation, it will be some more time before we can conclude whether this accident has crippled OKP's future as a road works contractor, or if it is just a superficial scratch. Look out for future public road works contracts, whether they are being awarded to OKP, and if so, how much. I will let time be the judge of whether the privileges of membership outweighs the safety of the public.

Looking at market prices, it seems most do not think OKP's future will be seriously affected.

[corydorus]

It is still early days.

A lengthy investigation will be conducted to determine the cause of the accident, and the parties at fault. Any fines to be paid should be manageable. Extra resources placed into re-constructing the highway could be significant but will not affect more than 1 quarter's earnings. But the biggest potential impact is OKP's ability to win future work.

After the investigation, it will be some more time before we can conclude whether this accident has crippled OKP's future as a road works contractor, or if it is just a superficial scratch. Look out for future public road works contracts, whether they are being awarded to OKP, and if so, how much. I will let time be the judge of whether the privileges of membership outweighs the safety of the public.

Looking at market prices, it seems most do not think OKP's future will be seriously affected.

Seems like without OKP bidding, our national road building cost will skyrocket. I doubt OKP will lose money in such works. and i doubt saving some safety costs will save much from a layman view. Those developers margin seem huge.

[axt]

Who is the next best company for road building without OKP? I can think of is maybe BBR who specialise in bridge design and construction. Hock Lian Seng?

[Debronic]

Okp is awarded Contract because they low bidder.
This project Okp is 25% below 2nd lowest bidder and 50% below 3 & 4 lowest bidder.

I just want to say that one should not look too much into the bid differences for some of these contracts. Look through the LTA tenders and you will notice that large bid differences for major contracts are much more common than people believe since it is impossible to know what everyone else will be bidding. This is especially true when the final number of bidders is low. Just to give you a few examples:
 
LTA contract ER397A Expansion of KPE/TPE Interchange including Link Road to Punggol Central (coincidentally awarded just a few months before OKP's project)-
1              Hock Lian Seng Infrastructure Pte. Ltd. / T.Y.Lin International Pte. Ltd.    Pt 1 297,260,00 Pt 2 4,279,600                    
2              Hwa Seng Builder Pte. Ltd / T.Y.Lin International Pte. Ltd.              Pt 1 185,060,000 Pt 2 4,279,600                  
3              Or Kim Peow Contractors (Private) Limited / CPG Consultants Pte Ltd     Pt 1 216,270,000 Pt 2 3,609,600                  
4              Tiong Seng Contractors (Private) Limited / YWL Engineering Pte Ltd          Pt 1 313,357,00 Pt 2 4,326,800                    
5              China Railway No. 8 - Wai Fong Construction Pte Ltd. J.V                -                              Not Shortlisted
 
Winner Hwa Seng's bid was 15%/31Mil lower than OKP and ~40% lower than the 3rd and 4th bidders
 
ER403 Construction of Vehicular Underpass at Nicoll Highway/ Guillemard Road Junction
 
S/No.    Name of Tenderer          Base      Alternative         Remarks
1              Chye Joo Construction Pte Ltd   58,786,303           ---          
2              Hock Lian Seng Infrastructure Pte Ltd     65,300,000           ---          
3              Koon Construction & Transport Co. Pte. Ltd.        59,300,000           ---          
4              McConnell Dowell S.E.A. Pte Ltd               85,057,574           ---          
5              Or Kim Peow Contractors (Private) Limited          Base (Option 1): 68,827,000.00   Base (Option 2): 68,227,000.00    
6              Penta-Ocean Construction Co., Ltd          77,888,000           ---          
7              Samwoh Corporation Pte. Ltd.   75,880,000           ---          
8              Sato Kogyo (S) Pte. Ltd. 44,980,000           ---          
9              Swee Hong Engineering Construction Pte Ltd      62,700,000           ---          
10           Tiong Seng Contractors (Private) Limited               75,000,195*        
*The Tender Amount in figures is $75,195,000 which does not tally with the Tender Amount in words " Seventy-Five Million One Hundred and Ninety-Five Only"               
 
Winner Sato Kogyo bid 24% lower than 2nd lowest even though with 10 bidders, you would expect the difference to be a lot closer.

Or to give a more extreme example:

TR150 Next Generation Electronic Road Pricing System 

S/No. Name of Tenderer Base Alternative Remarks
1 Ncs Pte. Ltd. / Mitsubishi Heavy Industries Engine System Asia Pte Ltd 530,541,882.00 507,526,414.00
2 St Electronics (Info-Comm Systems) Pte Ltd 1,260,000,000.00
3 WatchData Technologies Pte Ltd / Beijing WatchData System Co Limited - Not Shortlisted

In a 2 horse race, NCS/MHI submitted a bid that is > 50%/$700 m less than its only other competitor.

In all these instances, no one will bother to dig up the actual tender results and overanalyse until an accident actually happens and the speculation starts. 
PS: Pardon the odd formatting as I just copied and pasted the info above from LTA's tender information page.

[Ray168]

http://www.straitstimes.com/singapore/concrete-samples-taken-from-collapsed-viaduct-for-testing 

... The analysis will determine, among other things, the quality of the mixture, and whether it met design specifications. A lower quality concrete could be weaker than designed, and could indicate that contractors or suppliers cut corners.

... But experts said yesterday it was too early to say why the corbels gave way. Retired civil engineer Go Yang San, who was involved in several rail and road infrastructural projects here in the past three decades, said theories about poor design, weak processes and sub- standard materials should not focus only on the corbels.

[Ray168]

http://www.businesstimes.com.sg/companie...ldings-ltd


Broker's take: OKP Holdings Ltd
Monday, July 17, 2017 - 15:42
by Stephanie Luostephluo@sph.com.sg@StephLuoBT


A "hold" call has been placed on OKP Holdings Ltd with a target price of S$0.39 by KGI Research.
In a report on Monday, KGI said that the collapse of an uncompleted viaduct near the Pan-Island Expressway on July 14 is likely to hurt OKP's earnings and dividends. 

The construction firm called a trading halt last Friday morning after the accident at the worksite of its subsidiary Or Kim Peow Contractors claimed the life of one worker and injured 10 others. When trading resumed Monday morning, OKP saw its stock price plunge nearly 14 per cent.

KGI's report said: "Ongoing works on the project have been put on hold, and this has dampened our expectations of topline growth this year. A possible impairment charge due to the viaduct collapse is likely to further hurt FY17F earnings and dividends.

"OKP was previously penalised for a safety lapse that had led to another worker's death in 2015, and was debarred from employing new workers for a period of three months (Jan 5 to Apr 4, 2017). Coupled with the pending investigation of this latest workplace safety breach, this could affect OKP's chances of winning major upcoming public road construction projects as safety records could be taken into consideration in the tender process," it added.

[Ray168]

Jialat .... more reworks to be done.

http://www.channelnewsasia.com/news/sing...ts-9052886

[karlmarx]

OKP Holdings' Q2 profit doubles on higher revenue

CONSTRUCTION firm OKP Holdings on Monday reported that its second quarter net profit doubled to S$4.95 million from a year ago, on the back of strong growth in revenue from its maintenance segment.

For the three months as at end June, revenue came in at S$34.4 million, up 43.2 per cent year on year. This was due mainly to growth in its core business segments - construction and maintenance.

"The increase in revenue from both segments was due mainly to some of the projects progressing to a more active phase during the second quarter ended June 30, 2017," the group said on Monday in filings to the Singapore Exchange.

http://www.businesstimes.com.sg/companie...er-revenue

http://infopub.sgx.com/FileOpen/Q2Result...eID=464820

No mention was made of possible financial impacts from the accident.