Today’s Focus
Ezion - A synergistic union with AusGroup; maintain BUY
on Ezion with target price of S$3.26
Ezion has signed an MOU with AusGroup to collaborate on
business opportunities in the logistic supply chain and related
support services in Australia, including Port Melville, offshore
logistics, tank farms, etc. The collaboration is synergistic, as
Ezion and AusGroup currently serve different segments of the
supply chain in the oil and gas industries. Ezion may eventually
hold an 18.9% stake in Ausgroup for a total consideration of
up to S$54.6m, if the options granted are fully exercised.
Maintain BUY on Ezion with target price of S$3.26.
Keppel Corp has signed a 30-year management services
agreement with Titan Petrochemical Group (Titan) and Titan
Quanzhou Shipyard (TQS) to manage TQS shipyard. Located in
Quanzhou in Fujian Province, TQS is one of the largest shipyard
in China, occupying a total land area of 110ha with 3,600
length of coastline. A win-win partnership, Keppel will provide
engineering, procurement and project management support to
TQS. Keppel views this as a good opportunity that it allows
them to: 1) Tap the booming Chinese O&G activities and
demand for offshore structures, which is not accessible by
foreign yards; 2) Populate its proprietary designs in Chinese
waters through TQS; 3) Expand global capacity without
significant investment; 4) Meet the challenges of the tightening
foreign labour quota in Singapore. Some of the concerns are:
1) Technology transfer; 2) Reputation risks; and 3) Execution
challenges. The deal is conditional on the successful
restructuring and relisting of Titan.
ST Engineering announced that its aerospace arm, ST
Aerospace has recorded new orders worth $460m in the first
quarter (1Q) of 2014. These contracts cover a wide range of
the aerospace sector’s suite of capabilities, from airframe,
component and engine maintenance, to cabin reconfiguration
and engine wash.
Etika International Holdings has entered into a conditional
share purchase agreement with Asahi Group Holdings
Southeast Asia Pte. Ltd. for the sale of the dairies and
packaging business of the Company, its subsidiaries and
associated companies and the relevant intellectual for
US Indices Last Close Pts Chg % Chg
Dow Jones 16,437.2 181.0 1.1
S&P 1,872.2 20.2 1.1
NASDAQ 4,183.9 70.9 1.7
Regional Indices
ST Index 3,209.9 5.8 0.2
ST Small Cap 548.6 2.8 0.5
Hang Seng 22,843.2 246.2 1.1
HSCEI 10,380.7 58.9 0.6
HSCCI 4,305.2 29.6 0.7
KLCI 1,855.8 3.4 0.2
SET 1,382.0 2.7 0.2
JCI 4,921.4 0.4 0.0
PCOMP 6,587.5 (26.9) (0.4)
KOSPI 1,999.0 5.9 0.3
TWSE 8,930.6 42.3 0.5
Nikkei 14,299.7 (307.2) (2.1)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013 2014
100-Day MA
Index
STI
Total Market cap (US$bn) 597
Total Daily Vol (m shrs) 2,422
12m ST Index High 3,454
12m ST Index Low 2,960
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price (S$)
9 Apr
Target Price
(S$)
ComfortDelgro Buy 1.99 2.19
Global Logistic Properties Buy 2.57 3.31
Keppel Corp Buy 11.00 12.60
Stock Picks – Small Cap
Rec’n Price (S$)
9 Apr
Target Price
(S$)
Ezion Holdings Buy 2.10 3.26
Goodpack Buy 2.26 2.60
China Merchants Buy 0.975 1.32
Pacific Radiance Ltd Buy 1.095 1.20
Nam Cheong Buy 0.35 0.46
Centurion Corporation Buy 0.74 0.86
Source: DBS Bank
Singapore
Wired Daily
Page 2
US$328.8m (RM1,062.2m). The Asahi Group is one of the
world’s largest manufacturers and distributors of sweetened
condensed milk and is a leading player in the regional food
and beverage market. The gain from the proposed disposal
is estimated to be approximately RM625.9m.
Sysma Holdings announced the placement of 23.5m new
shares at S$0.27 per Placement Share to private investors.
Proceeds raised will be used to fund the Group’s property
development business, acquisitions, investments, joint
ventures and/or other collaborations, as well as for general
working capital purposes.
TSH Corporation intends to undertake a business
diversification into the property development and property
investment business in certain parts of Australia, while
retaining its current businesses.
In property news, resale prices of non-landed private homes
inched up 0.2% in March, led by an increase in transaction
prices in the Rest of Central Region (RCR). This marked a
slight recovery from a 3.1% decline in resale prices in
February, flash estimates by the Singapore Real Estate
Exchange (SRX) show. Resale transactions increased
significantly in March with 451 transactions registered - the
highest resale volume since October. This is 82.6% higher
than a month ago but 22.5% lower than in March last year.
US markets extended gains after the release of the Federal
Reserve's March meeting minutes. The minutes indicated
that Fed members were almost all united in getting rid of
the 6.5% unemployment target as a gauge for timing
interest rate increases. The market interpreted that as a sign
that rates would remain low for some time. The earnings
season commenced yesterday when Alcoa reported
earnings that topped expectations. The next big reports will
be from J.P. Morgan and Wells Fargo on Friday.-
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