Today’s Focus
Keppel Land – 1Q14 results in line; rental and recurring
income made up 60% of earnings. Retain BUY call and
target price S$4.65.
1Q14 results for Keppel Land in line. Net profit dropped 9.2%
to S$87.7m despite 38% higher revenues. Earnings were hurt
by higher effective tax rate and lower associate contribution.
Rental and recurring income made up 60% of earnings. The
group will continue to focus on Singapore, China, Indonesia
and Vietnam, grow their overseas commercial property
portfolio, and proactively recycle capital for higher returns.
Highline Residences in Singapore is ready for launch in 2Q14
while China offers another 607 homes in in 2H14. Retain Buy
call and target price of S$4.65. Kepland is currently trading at
steep 40% discount to RNAV of S$5.81.
Ezion has secured two 3-year charter contracts to provide
service rigs to support:
1) A South Asian based national oil company in the Arabian
Sea in South Asia. The contract valued US$43.7m; and
2) A Middle Eastern State-Linked company in the Arabian
Gulf. The contract worth US$35m.
Both service rigs are expected to commence work in 1H15 after
refurbishment and upgrading. Our forecasts should be largely
intact as we have factored in nine new contract wins this year.
With these, Ezion has secured four contracts YTD (one new
liftboat and three refurbished jackups).
Yanlord acquires a 171,200 sqm gross floor area (GFA) prime
residential development site in Suzhou Gao Xin District for
RMB1.35bn. The site is ideally situated for the development of
a prime residential development. The project benefits from a
comprehensive suite of business and lifestyle amenities and is
well connected via the city’s key thoroughfares and the No. 1
metro line.
Singapore Airlines (SIA) passenger load factor fell 4.3
percentage points to 75% last month, as passenger carriage
declined and capacity remained flat. SIA's systemwide
passenger carriage (measured in revenue passenger kilometres)
was down 5.4% y-o-y, while the number of passengers carried
decreased by 3.8% to 1.5 million. Passenger load factors (PLF)
declined across all route regions. The weaker passenger
carriage was attributed to a combination of the Easter demand
shift from March last year to April this year, and soft demand
US Indices Last Close Pts Chg % Chg
Dow Jones 16,262.6 89.3 0.6
S&P 1,843.0 12.4 0.7
NASDAQ 4,034.2 11.5 0.3
Regional Indices
ST Index 3,246.3 31.5 1.0
ST Small Cap 546.4 1.4 0.3
Hang Seng 22,671.3 (367.5) (1.6)
HSCEI 10,028.7 (215.3) (2.1)
HSCCI 4,253.8 (93.8) (2.2)
KLCI 1,853.9 2.4 0.1
SET 1,389.2 (0.4) (0.0)
JCI 4,870.2 5.3 0.1
PCOMP 6,621.7 32.1 0.5
KOSPI 1,992.3 (4.8) (0.2)
TWSE 8,916.7 59.3 0.7
Nikkei 13,996.8 86.6 0.6
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013 2014
100-Day MA
Index
STI
Total Market cap (US$bn) 597
Total Daily Vol (m shrs) 2,889
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$)
15 Apr
Target Price
(S$)
ComfortDelgro Buy 2.030 2.19
Global Logistic Properties Buy 2.660 3.31
Keppel Corp Buy 11.140 12.60
Stock Picks – Small Cap
Rec’n Price (S$)
15 Apr
Target Price
(S$)
Goodpack Buy 2.340 2.60
China Merchants Buy 0.965 1.32
Pacific Radiance Ltd Buy 1.050 1.20
Nam Cheong Buy 0.355 0.46
Centurion Corporation Buy 0.775 0.86
Source: DBS Bank
Singapore
Wired Daily
Page 2
to Bangkok. Meanwhile, SIA Cargo's load factor inched up
0.8 percentage point to 68% as the 2% decline in cargo
traffic (measured in freight-tonne-kilometres) was not as
sharp as the 3.1% contraction in capacity.
Singapore Airlines (SIA) is swooping in as title sponsor for
the Singapore Grand Prix - taking over from telco group
SingTel. The two-year partnership between SIA and the local
leg of the Formula 1 (F1) championship is expected to reap
benefits for both, in addition to the local tourism scene.
While SIA declined to comment on the price-tag that will
come with being the headline sponsor, it is said to be close
to what SingTel forked out during its six-year run as title
sponsor. Official figures were never disclosed, but it is
believed that the telco paid in the region of $10m-$15m per
year.
Developers sold 480 private homes in March, down from
739 units in February and 2,793 units in March last year.
This brings the first quarter's tally to 1,791 private homes
sold, down from 2,568 units in Q4 2013 and 5,412 units in
Q1 2013, Urban Redevelopment Authority (URA) data
shows. The muted sales were partly due to the low launch
volume in the first quarter. Only two new projects were
launched in March: The Santorini in Tampines and
Ascent@456 at Balestier Road - 724 units in all.
Retail sales in February slumped 9.5% y-o-y, distorted by
base effects from the Chinese New Year holidays which
took place in February last year. This year, Chinese New
Year fell at the end of January. Stripping out the sales of
motor vehicles, retail sales were down 9.2%. Retailers of
food & beverages, supermarkets, wearing apparel &
footwear, department stores, motor vehicles and provision
& sundry shops reported double-digit declines in sales
ranging from 10.5% to 33.7%. Other categories which
recorded lower sales in February included medical goods &
toiletries (-7.4%) and sales of recreational goods (-6.4%).
However, retail sales of optical goods and books grew 7%.
On a month-on-month, seasonally adjusted basis, retail sales
rose 3% in February from the previous month. Excluding
the sale of motor vehicles, retail sales edged up one per
cent.
U.S. stocks rebounded as earnings from Coca-Cola Co. and
Johnson & Johnson underpinned stocks even as concerns
that the tension in Ukraine worsened. Johnson & Johnson
said 1Q profit rose 34% on demand for the company’s
newest drugs and raised its 2014 forecast. Ukraine launched
an offensive to dislodge militants from towns in its eastern
Donetsk region as authorities in Kiev said elements of
Russian Special Forces were identified among the antigovernment
forces. Intel Corp. forecasts 2Q sales may
exceed some analysts’ estimates as improving corporate
orders help stabilize the declining personal-computer
market. IBM is scheduled to report quarterly earnings later
today.
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