Tuesday, June 10, 2014

DBSVickers Report 10 Jun 14

Today’s Focus
 Sheng Siong Group - Positive on purchase of HDB
commercial property. Maintain BUY with unchanged
target price of S$0.76.
Sheng Siong Group (SSG) announced that it has exercised an
option to purchase a three storey HDB commercial property in
Tampines Central for S$65m. Upon completion of the
purchase, SSG’s strategy is to gradually convert the various
existing leases as they expire into a sizeable new supermarket.
Its immediate plan is to operate a 10,000 sqft supermarket by
the end of 1Q15. We note that Giant Supermarket currently
occupies part of the property. We believe SSG will eventually
take over the supermarket space when Giant’s lease expires.
We anticipate that SSG will be quick to scale up its new
Tampines store since the area is matured and has an
established footfall. We are also positive that SSG will replace
its competitor within the area. Maintain BUY with unchanged
target price of S$0.76.
Global Logistic Properties has signed a build-to-suit (BTS)
agreement with Deppon Logistics for a 25,000 sqm distribution
center in Greater Xiamen, Southern China. Deppon Logistics
will use GLP Park Jinjiang to enhance its distribution capabilities
in Greater Xiamen and surrounding cities. Deppon Logistics is
one of GLP’s largest customers by leased area, using GLP
facilities in 17 locations across China.
AusGroup has been awarded a contract for the supply of
scaffolding material for works on the Chevron-operated
Gorgon Project. AusGroup will be providing 6,100 tonnes of
scaffolding material for the project, which will be used to
provide access for the completion of modules, ancillary
structures and equipment for all trades services being carried
out on Barrow Island.
Ley Choon Group Holdings has been awarded six contracts
with a combined value of S$20.4m from the Singapore Public
Utilities Board (PUB). These new orders came hot on the heels
of the S$38.2m sewer pipe rehabilitation contract secured in Sri
Lanka on 3 June 2014, boosting the Group’s new orders from
the water/sewer segment to S$58.7m in a month and total
outstanding order book to S$201.4m.
US Indices Last Close Pts Chg % Chg
Dow Jones  16,943.1 18.8 0.1
S&P  1,951.3 1.8 0.1
NASDAQ  4,336.2 14.8 0.3
Regional Indices
ST Index  3,305.2 5.8 0.2
ST Small Cap  562.0 2.2 0.4
Hang Seng  23,117.5 166.5 0.7
HSCEI  10,406.8 65.8 0.6
HSCCI  4,275.8 27.2 0.6
KLCI  1,863.7 1.0 0.1
SET  1,457.3 (0.7) (0.0)
JCI  4,885.1 (52.1) (1.1)
PCOMP  6,802.7 40.1 0.6
KOSPI  1,990.0 (5.4) (0.3)
TWSE  9,162.7 28.3 0.3
Nikkei  15,124.0 46.8 0.3

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$bn) 616
Total Daily Vol (m shrs) 2,517
12m ST Index High 3,305
12m ST Index Low 2,960
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price (S$)
9 Jun
Target Price
(S$)
Global Logistic Properties Buy 2.770 3.42
Mapletree Greater China
Commercial Trust
Buy 0.870 1.02
Thai Beverage Public Buy 0.640 0.68
Stock Picks – Small Cap
Rec’n Price (S$)
9 Jun
Target Price
(S$)
Vard Holdings Buy 1.120 1.34
Nam Cheong Buy 0.385 0.47
Centurion Corporation Buy 0.700 0.86
Source: DBS Bank
Singapore
Wired Daily
Page 2
Tritech Group has been awarded a S$7.014m Tunneling
and Excavation Monitoring System contract by the Land
Transport Authority (LTA). The duration of the contract is
from 06 June 2014 to 30 June 2021.
Loan restriction measures, buyers' stamp duties aside,
aggressive discounts offered by developers on new units
and weak leasing conditions drove resale transactions and
prices of non-landed private homes down last month. Flash
figures released by the Singapore Real Estate Exchange
(SRX) showed that the number of condo units resold in May
fell 7.5% month-on-month to 421 units. This is 42.6%
lower than the 734 units resold in May last year. Resale
prices continued to inch down, falling 0.3% in May, driven
mostly by a 2.9% price plunge in the luxury market in the
core central region; prices wilted by 0.3% in the city fringes.
Only prices in the suburban areas bucked the trend,
climbing 0.6%. Rental volume rose slightly - up 3.7% - to
3,120 whole units, from April's 3,010 transactions, but
rental prices slipped 0.8%. Since January last year, rental
prices have fallen by 6%.
Global private financial wealth grew 14.6% last year - up
from 8.7% in 2012 - to reach US$152 trillion, driven mainly
by equity markets and the creation of new wealth in rapidly
developing economies (RDEs). The Boston Consulting
Group's 2014 report on the global wealth management
industry released recently said that in nearly all countries,
the growth of private wealth was "driven by the strong
rebound in equity markets that began in the second half of
2012". Further contributing factor were signs of recovery in
European countries including Spain and Ireland. Over the
next five years, global private wealth is projected to post a
compound annual growth rate (CAGR) of 5.4% to hit an
estimated US$198.2 trillion by end-2018.
U.S. markets rose led by gains in small-cap shares and M&A
activity. Analog Devices agreed to buy a chipmaker for
about US$2bil while Merck & Co. bought into drugmaker
Idenix Pharmaceuticals Inc. for US$3.9bil. Tyson Foods Inc.
shares fell after the company said it made a binding offer
for Hillshire Brands Co. Apple shares climbed 1.6% to
$93.70 following its stock split.

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