Hyflux - Awaiting catalysts, maintain HOLD on limited
visibility and upside to S$1.23 TP.
Hyflux reported an unusually strong 3Q13, bumped up by
Tuaspring desal plant. 4Q is expected to slow down on
lack of major project recognitions while the financial close
of Dahej is only in 1Q14. Orderbook is depleting; future
growth is dependent on new projects. Hyflux has
>US$2bn in bidding/enquiry in the pipeline. Our analyst
has tweaked FY13F and14F earnings up by 2% each.
Maintain HOLD on limited visibility and upside to S$1.23
TP.
3Q13 core net profit for Wilmar came in at US$391m
(+1% y-o-y; +60% q-o-q) - or 26% above mid-range
forecast of US$303-317m. Including non-operating items,
Wilmar booked 3Q13 earnings of US$416m (+3% y-o-y;
+90% q-o-q). 3Q13 revenue was US$11,837m, (-4% y-oy,
+14% q-o-q). The y-o-y decline was due to significantly
lower palm oil prices. Our current Hold rating and TP of
S$3.53 are under review, pending management outlook
guidance.
StarHub’s 3Q13 earnings of S$95.3(-1% y-o-y, -5% q-oq)
was in line; 9M12 earnings comprise 75.9% of our
FY13F forecast of S$378m. Weak mobile revenue was
offset by lower handset subsidies and lower traffic costs.
Non-mobile business was weak, as expected. Dividend
yield of 4.5% and mid-single digit growth prospects are
priced in; Maintain HOLD and S$$4.30 TP.
China Merchant Holdings reported results that were
ahead of expectations. 3Q13 net earnings rose 46% yoy
to HK$145.8m as revenue rose 37% yoy to HK$486m,
due to the contribution of newly acquired Ningbo-Beilun
Port E'way. Contribution from JV roads also rose 12% yoy
to Hk$68.7m in the quarter. For the first nine months, net
earnings rose 40% yoy to HK$450m on 34% top line
growth to HK$1.4bn, as JV rose also contributed 23% yoy
more to HK$207.8m. This is a strong set of results against
our FY earnings forecast of HK$489m. More updates to
follow.
2Q14 earnings for Yoma Strategic Holdings slightly ahead,
driven by brisk property sales and pick up in construction.
Star City is still the bright spot as Landmark awaits
progress. Maintain BUY and S$1.02 TP.
US Indices Last Close Pts Chg % Chg
Dow Jones 15,594.0 (152.9) (1.0)
S&P 1,747.2 (23.3) (1.3)
NASDAQ 3,857.3 (74.6) (1.9)
Regional Indices
ST Index 3,202.1 (3.2) (0.1)
ST Small Cap 539.2 (2.0) (0.4)
Hang Seng 22,881.0 (155.9) (0.7)
HSCEI 10,474.3 (87.2) (0.8)
HSCCI 4,491.2 (19.3) (0.4)
KLCI 1,806.6 3.6 0.2
SET 1,425.2 (9.7) (0.7)
JCI 4,486.1 36.3 0.8
PCOMP 6,436.5 (40.8) (0.6)
KOSPI 2,004.0 (9.6) (0.5)
TWSE 8,283.7 1.7 0.0
Nikkei 14,228.4 (108.9) (0.8)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 594
Total Daily Vol (m shrs) 2,043
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price ($)
7 Nov
Target Price
($)
ST Engineering Buy 4.200 4.80
ComfortDelgro Buy 1.915 2.19
OCBC Bank Buy 10.450 12.40
Singapore Airlines Buy 10.440 11.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
7 Nov
Target Price
($)
Ezion Holdings Buy 2.010 3.10
CSE Global Buy 0.920 1.07
Frasers Centrepoint Trust Buy 1.830 2.14
Yoma Strategic Holdings Buy 0.770 1.02
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
ST Engineering posted a 10.3% y-o-y slide in net profit to
$131.4m for 3Q13. Revenue was flat at $1.55 bn. For the
nine-month period, net profit was 2.5% lower at $413.3m,
while revenue was 0.8% higher at $4.69 bn. No dividend
was announced for the quarter.
SIA Engineering reported a net profit of $71m for 2Q14, up
5.8% y-o-y. Revenue climbed 3.3% to $293.9m on the back
of an increase in airframe and component overhaul work. For
the six months ended September 30, net profit increased 2%
to $140m, despite revenue slipping slightly to $583.3m.
COSCO Corporation has secured a Letter of Intent from
Prosafe SE, for the engineering, procurement and
construction of 2 (two) semi-submersible accommodation
vessels with options for 4 (four) more units. The Letter of
Intent covers two potential contracts, each in excess of
USD200m. The vessels are scheduled for delivery in 2016.
Abterra is expected to report a loss for 3Q13, though the loss
will be pared as compared to the loss for the previous
corresponding quarter.
China Essence Group is expected to register a net loss for 2Q
FY14. The Group saw a decrease in sales volumes for all its
products in 2Q FY14 due to the low production level.
Mencast Holdings has entered into agreements to acquire
the entire stake in CYE, a leading provider of precision
manufactured components and assemblies. The purchase
consideration of S$11.0m will be satisfied by issue of new
shares and cash.
Dow eased 1% despite upbeat economic data. GDP grew by
2.8% (QoQ) – above consensus expectations of 2.0% (DBS:
1.4%). However, private consumption - 70% of GDP and the
ultimate driver of the economy – grew by only 1.5% (QoQ) in
Q3, the lowest in 3.5 years. Business fixed investment –
another 13% of GDP – rose by 1.6% (QoQ, saar); growth
here has now averaged but 0.6% for the past nine months.
In Europe, ECB unexpectedly cut a key interest rate to
0.25%. Nonfarm payrolls are on tap today. Markets expect a
low 125k jobs were added in October.
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