Nam Cheong - Potential early beneficiary of renewed
strength in OSV market. Maintain BUY with TP revised
up to S$0.42
Nam Cheong is a potential early beneficiary of renewed
strength in offshore support vessel (OSV) market. Earnings
execution is above estimates YTD in FY13; FY13/14 EPS
estimates revised up by 6-8%. We are expecting healthy 2-
year earnings CAGR of 22%, with further upside if FY15
built-to-stock programme is bigger than expected. Maintain
BUY with TP revised up to S$0.42 (Prev S$ 0.36) as we roll
over valuations to FY14 earnings. Nam Cheong remains one
of our top picks in the O&M sector.
Centurion announced that it is the successful bidder for the
RMIT Village and an adjoining car park building in Melbourne,
Australia, for a total purchase consideration of A$60m. RMIT
Village is located on the northern edge of Melbourne’s
Central Business District, also close to RMIT University and the
University of Melbourne. This is a 4,000 sqm freehold land
parcel comprising 229 apartments with a current capacity of
approximately 456 beds. As this student accommodation
facility is affiliated to RMIT University, this property benefits
from the university's reservations for its students at the start
of each academic year. Typically, RMIT University reservations
account for 70% of the total occupied beds annually. For the
past three years, occupancy at RMIT Village has been close to
100%. This acquisition is in line with Centurion's
diversification strategy and expected to be earnings accretive
upon completion in early 2014. The proposed acquisition will
be funded through proceeds from S$50m MTN issued on 10
Oct 2013 and bank borrowings.
Swissco Holdings has secured charter contracts worth an
aggregate of S$27.0m for its new vessels. The contracts
secured are for a minimum 12-months charter contract for
new 60-meters AHTS to be deployed in the Middle East and
27-months charter contract for another new 60-meters AHTS
to be deployed in North East Australia. This reiterates healthy
demand for offshore support vessels. The Group continues to
focus on vessel expansion and fleet renewal program.
US Indices Last Close Pts Chg % Chg
Dow Jones 16,097.3 24.5 0.2
S&P 1,807.2 4.5 0.2
NASDAQ 4,044.8 27.0 0.7
Regional Indices
ST Index 3,186.4 14.3 0.5
ST Small Cap 535.9 1.2 0.2
Hang Seng 23,789.1 (17.3) (0.1)
HSCEI 11,385.3 (16.7) (0.1)
HSCCI 4,641.3 23.2 0.5
KLCI 1,807.6 9.1 0.5
SET 1,359.5 (13.7) (1.0)
JCI 4,233.9 (17.6) (0.4)
PCOMP 6,170.0 116.1 1.9
KOSPI 2,045.8 17.0 0.8
TWSE 8,362.4 66.6 0.8
Nikkei 15,727.1 277.5 1.8
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 579
Total Daily Vol (m shrs) 1,471
12m ST Index High 3,454
12m ST Index Low 3,004
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price (S$)
28 Nov
Target Price
(S$)
Hutchison Port Holdings Trust Buy 0.685 0.82
ComfortDelgro Buy 1.970 2.19
OCBC Buy 10.500 12.40
Singapore Airlines Buy 10.530 11.40
Stock Picks – Small /Mid Cap
Rec’n Price (S$)
28 Nov
Target Price
($)
Ezion Holdings Buy 2.070 2.65
China Merchants Buy 0.905 1.20
CSE Global Buy 1.005 1.11
Frasers Centrepoint Trust Buy 1.785 2.14
Yoma Strategic Holdings Buy 0.750 1.02
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
Oxley Holdings said its wholly owned subsidiary, Oxley Ruby
Sdn Bhd, will develop a 15.28-acre freehold land in Malaysia's
state of Selangor. Oxley Ruby was granted the rights to
develop the land after it inked a joint venture agreement with
the landowner, Peninsular Teamwork Sdn Bhd. The agreement
provides for Oxley Ruby to have sole and absolute discretion to
develop the land in any manner it deems appropriate, and at
its own cost.
Pteris Global released more details of its reverse takeover
(RTO) by passenger boarding bridge manufacturer Tianda
Group. It will acquire the remaining 30% of Tianda from
Shenzhen TGM, the management company of Tianda, for
$41.3m, or RMB208.4m. This is in addition to the 70% of
Tianda to be acquired from China International Marine
Containers (Hong Kong) for $96.3m, announced in July after a
conditional sales-and-purchase agreement was made. Like its
purchase of the previous stake in Tianda, Pteris will issue new
shares to satisfy the deal, after the proposed consolidation of
five shares, at 13 cents each, into one. Post-consolidation,
shares will be issued at 65 cents apiece.
China Aviation Oil, the largest physical jet fuel trader in the
Asia Pacific region, has expanded its operations in Europe with
the establishment of a wholly owned subsidiary, China
Aviation Oil (Europe) Limited (CAO Europe), in the United
Kingdom. The expansion into new market broadens aviation
marketing opportunities and creates synergies for enhanced
trading activities.
Singapore’s home prices fell at a faster pace in October,
dropping 1.2% from the previous month as evidence builds
that the government's efforts to cool the property market are
working. The Singapore Residential Price Index fell to 159.1
points last month after declining a revised 0.9% in September.
The measure tracking prices in the central region decreased
1.4% in October. Meanwhile, URA data earlier this month
showed Singapore's home sales fell 19% m-o-m and 48% yo-
y in October to 1,009 units.
Despite the slowdown in new private home sales, demand for
land remains strong, with two adjacent plots at Upper
Serangoon View garnering eight bids each. The top bid for
both sites was put up by Kingsford Development, at $522.43
psf ppr, which translates into $258.8m for Parcel A and
$201.6m for Parcel B. Parcel A has a land area of 165,125 sq
ft and is located next to Rio Vista condo, while Plot B has a
land area of 128,644 sq ft. Kingsford Development beat the
second highest bids for Parcel A and Parcel B by 16% and
12.7% respectively.
Li Ka-shing said his companies have slowed land purchases in
Hong Kong and China as prices have escalated to a high level.
“Land prices in Hong Kong are high, and already showing
signs of an unhealthy situation,” Li said, according to a
statement from Cheung Kong Holdings Ltd. Li added that
“Land prices in China have surged, and we’re unable to win
auctions for land.” His comments underline concerns that
governments in China and in the city are struggling to tame an
asset bubble fuelled by cheap credit
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