Dow closed -7 at 15392 last night. Europe
were mixed. Dow's trend is still up but flattening. Dow's future
is now -4. Europe opened marginally down.
Asian bourses were mixed. Nikkei
+20, ShanghaiC -19, Hangseng -122. STI closed +14 at 3210. Volume
was 3.2b shares. Gainers were 284 to 205 losers.
Trend of STI is turning slightly up.
Top volumes were Innopac -0.3, SingHaiyi
-0.1, KepREIT -4, Albedo -0.3, Blumont -3, LionGold +2.5, Asiasons +1,
YHM -0.2, AceAchieve +0.1, Ipco -0.1.
Market opened slightly up and stayed
up throughout the day. It closed near day high. Blue chips were mostly
higher. Penny stocks were mixed.
Europe and Dow are looking to trade
sideways tonight.
Tuesday, October 22, 2013
Monday, October 21, 2013
OCBC Report 22 Oct 13
| KEY IDEA Midas Holdings: Awaken the sleeping giant Following last week’s CNY221.8m international train and China metro contract wins, Midas Holdings (Midas) announced last evening that it has secured contracts to supply aluminium alloy extrusion profiles and certain fabricated parts for the manufacture of high-speed trains in China. These contracts are worth CNY167.5m in total, with delivery expected from 2013 to 2014. Total YTD order wins for Midas has now hit ~CNY812.6m (FY12: CNY324.9m). We view Midas’ latest high-speed train contract success as a strong re-rating catalyst for its share price given that its last high-speed contract win came in Feb 2011. We believe this may also set the momentum for further such contract wins to come, given China’s ambition to develop its rail transport sector. Maintain BUY and S$0.65 fair value estimate on Midas, based on 1.3x blended FY13/14F P/B. (Wong Teck Ching Andy) MORE REPORTS Hutchison Port Holdings Trust: 3Q13 missed expectations Hutchison Port Holdings Trust (HPHT) reported 3Q13 results that were lower than ours and the street’s expectations. Revenue climbed 1% YoY to HK$3.36b. Total operating expenses increased by 1.3% to HK$2.17b. Profit after tax fell 2.2% to HK$966m. Profit attributable to HPHT unitholders fell 8.4% to HK$539m. We lower our forecasts to -1% and 0% YoY change in 2013 throughput for HPHT’s ports in Kwai Tsing, HK and Yantian, Shenzhen respectively. Our previous forecasts were 0% and 2% growth. Our revenue forecast for FY13 thus falls to HK$12.4b from HK$12.6b. Shipping lines' formation of alliances, e.g. P3, G6 and CKYH, should continue to put pressure on transshipment volumes, especially in HK. We trim our FV for HPHT to US$0.74 from US$0.84 and downgrade HPHT from Buy to HOLDon valuation grounds. HPHT is currently trading at a FY13F dividend yield of 6.8%. (Sarah Ong) Frasers Centrepoint Trust: Repeating its success Frasers Centrepoint Trust (FCT) released its 4QFY13 results last evening. NPI fell 5.0% to S$27.3m due mainly to higher property taxes and maintenance costs. However, distributable income was up 2.7% to S$21.7m as FCT benefited from lower borrowing costs and higher distribution from Hektar REIT. In addition, S$2.9m of cash (0.35 S cents/unit) retained in 1HFY13 was distributed during the quarter. As a result, DPU jumped 10.0% to 2.98 S cents. For FY13, DPU came in at 10.93 S cents, up 9.2%. This is spot on with our DPU projection. We note that operational performance remained robust over the quarter, with portfolio occupancy maintained at a high 98.4%, while positive rental reversion of 10.8% was achieved. Noteworthy was the S$195.7m revaluation gain of its portfolio properties, which led to a 14.9% QoQ improvement in its NAV to S$1.77 and 2.8ppt drop in its gearing level to 27.6%. We will be attending FCT’s analyst briefing later in the morning to get more colour on its outlook. Given the recent weakness in FCT’s unit price performance, we are placing our S$1.96 fair value and Hold rating under review. (Kevin Tan) China Environment: Gearing up for higher demand China Environment Ltd (CEL) is a provider of industrial waste gas treatment solutions in China, which is likely to benefit from the Chinese government’s increased focus on cleaning up the environment in China. At the invitation of CEL, we visited their new facility in Bengbu, Anhui Province, China, which houses 12 production buildings. We also visited one of its customers – Shanghai-listed Nanjing Iron & Steel Co (NIS) – to have a look at four dust elimination machines currently deployed in one of its facilities. CEL has built up to 15 such machines for NIS since 2004; but we understand that all these machines are due for upgrades to meet the increasingly higher discharge standards over the next few years. Currently, CEL has an order book of RMB241m as of Sep 2013, up from RMB66.8m as of end-Jun, which it expects to deliver over the next few months. Coupled with some RMB80m raised via a share placement recently, CEL adds that it has sufficient working capacity to take on bigger jobs. We currently do not have a ratingon the stock. (Carey Wong) |
For more information on the above, visit www.ocbcresearch.comfor the detailed report. |
NEWS HEADLINES - US stocks finished little changed on Mon, with the S&P 500 adding a fraction to its record close and the Nasdaq Composite extending gains into a fourth session. - Share prices of Asiasons Capital, Blumont Group and LionGold Corp almost doubled in yesterday's trading after trading curbs were lifted. - PT Indofood Sukses Makmur plans to keep China Minzhong listed on the Mainboard of the Singapore Exchange, despite the public float falling to 4.4%. - ValueMax Group, Singapore's biggest pawnbroking chain by revenue, is seeking about S$70.4m in an IPO to expand its business. - TTJ Holdings has clinched new contracts worth S$41m for Downtown Line 2 jobs. - Civmec Ltd announced it had won S$210m worth of new contracts since its last announcement in end-Jul, boosting its order book to S$330m. |
DBSVickers Report 22 Oct 13
HPH Trust – Expect DPU to improve to 5.9UScts in
FY14; maintain BUY and US$0.82 TP
Midas – Finally, high-speed railway contract wins,
with potential for much more
Hutchison Port Holdings Trust’s 3Q earnings fell 8% y-o-y
to HK$539m, but improved 28% q-o-q as its HK port
operations are now back on track. There are signs of
some improvement in US bound trade but cargo traffic to
Europe remains tepid. HPHT is on track for DPU of
40HKcts for the full year. We maintain our view that the
worst is over for HPHT. We project HPHT’s DPU to
improve from 5.3UScts to 5.9UScts in FY14. Maintain BUY
and US$0.82 TP
Midas has finally announced the high-speed train contract
wins worth Rmb168m, the first in three years. This is a
positive sign of turning point, with more such contracts
expected to flow in rapidly. Order book is now nearly
Rmb1bn, with potential for much more. Maintain BUY, TP
S$0.60. Further upside to our TP could come from large
high-speed train contract wins in 2014. The stock is
currently trading at just 0.9x P/BV, with a firm turnaround
story to boot.
United Envirotech has signed a concession agreement
with the local government of Qixia City in Yantai,
Shandong for the transfer- expand-operate-transfer
(TEOT) of a municipal wastewater treatment project.
Under the terms of the agreement, the total investment
for the project is approximately RMB105m (~S$21m). The
expansion and upgrading work will commence
immediately and is expected to be completed by third
quarter of 2014. The construction of this project will add
RMB70m to EPC's orderbook, lifting YTD new contract
win to RMB521m, ahead of our RMB 400m assumption.
However, major recognition of this orderbook would be in
FY15 and the impact of this particular project on UENV's
existing portfolio is small. Hence, impact of this project is
immaterial to existing performance. However, separately,
we believe higher interest expenses arising from the
recent MTN issues could take toll on earnings. Our
earnings and TP of S$0.98 are under review.
US Indices Last Close Pts Chg % Chg
Dow Jones 15,392.2 (7.4) (0.0)
S&P 1,744.7 0.2 0.0
NASDAQ 3,920.0 5.8 0.1
Regional Indices
ST Index 3,195.8 2.9 0.1
ST Small Cap 541.9 4.7 0.9
Hang Seng 23,438.2 98.1 0.4
HSCEI 10,668.2 24.2 0.2
HSCCI 4,571.0 38.1 0.8
KLCI 1,802.6 3.0 0.2
SET 1,448.5 (36.2) (2.4)
JCI 4,578.2 31.6 0.7
PCOMP 6,597.6 (10.3) (0.2)
KOSPI 2,053.0 0.6 0.0
TWSE 8,419.3 (21.9) (0.3)
Nikkei 14,693.6 132.0 0.9
STI
Total Market cap (US$bn) 593
Total Daily Vol (m shrs) 4,570
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price ($)
21 Oct
Target Price
($)
ST Engineering Buy 4.23 4.80
ComfortDelgro Buy 1.92 2.19
OCBC Bank Buy 10.36 12.40
Singapore Airlines Buy 10.34 11.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
21 Oct
Target Price
($)
Ezion Holdings Buy 2.23 3.10
Goodpack Buy 1.865 2.00
CSE Global Buy 0.885 1.07
Mapletree Commercial Trust Buy 1.25 1.35
Frasers Centrepoint Trust Buy 1.85 2.14
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
Civmec has recently won over S$$210m of contracts. These
contracts have increased the order book to over S$$330m.
TTJ has clinched $41m deals for Downtown Line 2 jobs. It
had re-secured the sub-contracts from McConnell Dowell
SEA to supply, fabricate and install civil defence shelter doors
for the Sixth Avenue and King Albert Park stations on the
Downtown Line 2. The new contract, which the group
expects to complete substantially in FY2014 and 2015, will
bring TTJ's order book to $151m.
OKH Global has been awarded a S$32.8m contract in
relation to the design and build for the proposed new
erection of a 4-storey warehouse with ramp up facilities at
No. 7 Pioneer Sector Lane, by Nam Leong Co. The Project is
expected to have a positive impact on FY June 2014.
New and existing players in the foreign school arena looking
for a long-term investment in a flagship Singapore campus
will soon be able to bid for a 26-year lease for a property
surrounded by international schools and near Good Class
Bungalow (GCB) areas. The German European School
Singapore (GESS) has launched a tender for a 26-year sublease
on its main campus at 72 Bukit Tinggi Road in the Swiss
Club locale. The minimum reserve price is set at $39m, which
translates to $415 psf on the existing gross floor area of
93,969 sq ft for the campus. Selling a long sub-lease for the
Bukit Tinggi premises to another educational institution will
help the school to fund development of a new campus in
Upper Bukit Timah which is expected to be ready in 2017.
GESS is currently in talks with the Singapore authorities for
allocation of the site for the new campus.
US markets ended mixed ahead of the September
employment numbers scheduled for release tonight.
Consensus expects non-farm payrolls to improve to 180k
from 169k in August. Meanwhile, consensus now expects QE
tapering to begin only in 1Q 2014 earliest, accessing the
impact of the recent partial federal government shutdown
FY14; maintain BUY and US$0.82 TP
Midas – Finally, high-speed railway contract wins,
with potential for much more
Hutchison Port Holdings Trust’s 3Q earnings fell 8% y-o-y
to HK$539m, but improved 28% q-o-q as its HK port
operations are now back on track. There are signs of
some improvement in US bound trade but cargo traffic to
Europe remains tepid. HPHT is on track for DPU of
40HKcts for the full year. We maintain our view that the
worst is over for HPHT. We project HPHT’s DPU to
improve from 5.3UScts to 5.9UScts in FY14. Maintain BUY
and US$0.82 TP
Midas has finally announced the high-speed train contract
wins worth Rmb168m, the first in three years. This is a
positive sign of turning point, with more such contracts
expected to flow in rapidly. Order book is now nearly
Rmb1bn, with potential for much more. Maintain BUY, TP
S$0.60. Further upside to our TP could come from large
high-speed train contract wins in 2014. The stock is
currently trading at just 0.9x P/BV, with a firm turnaround
story to boot.
United Envirotech has signed a concession agreement
with the local government of Qixia City in Yantai,
Shandong for the transfer- expand-operate-transfer
(TEOT) of a municipal wastewater treatment project.
Under the terms of the agreement, the total investment
for the project is approximately RMB105m (~S$21m). The
expansion and upgrading work will commence
immediately and is expected to be completed by third
quarter of 2014. The construction of this project will add
RMB70m to EPC's orderbook, lifting YTD new contract
win to RMB521m, ahead of our RMB 400m assumption.
However, major recognition of this orderbook would be in
FY15 and the impact of this particular project on UENV's
existing portfolio is small. Hence, impact of this project is
immaterial to existing performance. However, separately,
we believe higher interest expenses arising from the
recent MTN issues could take toll on earnings. Our
earnings and TP of S$0.98 are under review.
US Indices Last Close Pts Chg % Chg
Dow Jones 15,392.2 (7.4) (0.0)
S&P 1,744.7 0.2 0.0
NASDAQ 3,920.0 5.8 0.1
Regional Indices
ST Index 3,195.8 2.9 0.1
ST Small Cap 541.9 4.7 0.9
Hang Seng 23,438.2 98.1 0.4
HSCEI 10,668.2 24.2 0.2
HSCCI 4,571.0 38.1 0.8
KLCI 1,802.6 3.0 0.2
SET 1,448.5 (36.2) (2.4)
JCI 4,578.2 31.6 0.7
PCOMP 6,597.6 (10.3) (0.2)
KOSPI 2,053.0 0.6 0.0
TWSE 8,419.3 (21.9) (0.3)
Nikkei 14,693.6 132.0 0.9
STI
Total Market cap (US$bn) 593
Total Daily Vol (m shrs) 4,570
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price ($)
21 Oct
Target Price
($)
ST Engineering Buy 4.23 4.80
ComfortDelgro Buy 1.92 2.19
OCBC Bank Buy 10.36 12.40
Singapore Airlines Buy 10.34 11.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
21 Oct
Target Price
($)
Ezion Holdings Buy 2.23 3.10
Goodpack Buy 1.865 2.00
CSE Global Buy 0.885 1.07
Mapletree Commercial Trust Buy 1.25 1.35
Frasers Centrepoint Trust Buy 1.85 2.14
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
Civmec has recently won over S$$210m of contracts. These
contracts have increased the order book to over S$$330m.
TTJ has clinched $41m deals for Downtown Line 2 jobs. It
had re-secured the sub-contracts from McConnell Dowell
SEA to supply, fabricate and install civil defence shelter doors
for the Sixth Avenue and King Albert Park stations on the
Downtown Line 2. The new contract, which the group
expects to complete substantially in FY2014 and 2015, will
bring TTJ's order book to $151m.
OKH Global has been awarded a S$32.8m contract in
relation to the design and build for the proposed new
erection of a 4-storey warehouse with ramp up facilities at
No. 7 Pioneer Sector Lane, by Nam Leong Co. The Project is
expected to have a positive impact on FY June 2014.
New and existing players in the foreign school arena looking
for a long-term investment in a flagship Singapore campus
will soon be able to bid for a 26-year lease for a property
surrounded by international schools and near Good Class
Bungalow (GCB) areas. The German European School
Singapore (GESS) has launched a tender for a 26-year sublease
on its main campus at 72 Bukit Tinggi Road in the Swiss
Club locale. The minimum reserve price is set at $39m, which
translates to $415 psf on the existing gross floor area of
93,969 sq ft for the campus. Selling a long sub-lease for the
Bukit Tinggi premises to another educational institution will
help the school to fund development of a new campus in
Upper Bukit Timah which is expected to be ready in 2017.
GESS is currently in talks with the Singapore authorities for
allocation of the site for the new campus.
US markets ended mixed ahead of the September
employment numbers scheduled for release tonight.
Consensus expects non-farm payrolls to improve to 180k
from 169k in August. Meanwhile, consensus now expects QE
tapering to begin only in 1Q 2014 earliest, accessing the
impact of the recent partial federal government shutdown
Daily Summary 21 Oct 13
Dow and Europe closed positive on Friday.
Dow +28 at 15400. Trend of Dow is up. Dow's future is flat at the
moment. Europe opened slightly down.
Asian bourses were mostly positive. Nikkei +132, ShanghaiC +35, Hangseng +98. STI closed +4 at 3196. Volume was 4.5b shares. Gainers were 336 to 148 losers.
Trend of STI is flat.
Top volumes were Innopac +1.4, Sunmoon unchanged, Digiland unchanged, AceAchieve +0.1, Albedo +0.6, Blumont +10.7, Asiasons +11.7, Ipco +0.3, YHM +0.1, MetechInt +0.5.
Market opened up but drifted down and closed +4. Blue chips were mostly up. Penny and speculatives were also firmer.
The three designated stocks of Blumont, Asiasons and LionGold had their suspension lifted today. All three counters gained about 10% each.
Market sentiment was steady.
Europe and Dow are steady at the moment.
Asian bourses were mostly positive. Nikkei +132, ShanghaiC +35, Hangseng +98. STI closed +4 at 3196. Volume was 4.5b shares. Gainers were 336 to 148 losers.
Trend of STI is flat.
Top volumes were Innopac +1.4, Sunmoon unchanged, Digiland unchanged, AceAchieve +0.1, Albedo +0.6, Blumont +10.7, Asiasons +11.7, Ipco +0.3, YHM +0.1, MetechInt +0.5.
Market opened up but drifted down and closed +4. Blue chips were mostly up. Penny and speculatives were also firmer.
The three designated stocks of Blumont, Asiasons and LionGold had their suspension lifted today. All three counters gained about 10% each.
Market sentiment was steady.
Europe and Dow are steady at the moment.
Sunday, October 20, 2013
OCBC Report 21 Oct 13
| CapitaCommercial Trust: Resilient to absence of OGS income support Distributable income for 3Q13 increased 1.6% YoY to S$58.8m mostly due to lower interest expenses and the distribution of S$1.7m in tax-exempt income from Quill Capita Trust (QCT), which offset the loss of income support from One George St (OGS). Note that, going forward, CCT can still draw from S$10.9m of retained tax-exempt income from QCT, and also S$0.9m of retained taxable income from RCS Trust to be released in 4Q13. 9M13 distributable income cumulated to S$174.0m, up 2.2% YoY, which made up 75.9% of our FY13 forecast and is judged to be mostly within expectations. 3Q13 DPU is 2.04 S-cents which translates to a 5.7% distribution yield based on the last closing price of S$1.42. We expect CCT to benefit from an improving Grade A office market in FY14 as rental levels reach a turning point in an environment of resilient absorption and limited supply, with only CapitaGreen (~700k sq ft NLA) coming online in FY14 in the Core CBD sub-segment. Maintain BUY with an unchanged fair value estimate of S$1.61. (Eli Lee) MORE REPORTS Mapletree Logistics Trust: Delivering steady growth Mapletree Logistics Trust (MLT) reported 2QFY14 DPU of 1.82 S cents, representing a 6.4% growth YoY. We deem the results to be in line with our expectations, as 1HFY14 DPU of 3.62 S cents have met 49.9% of our full-year DPU forecasts. While the global economic outlook remains murky, leasing demand at MLT’s logistics facilities has held firm. Going forward, MLT reiterated that it will continue to optimize the portfolio yield through repositioning, enhancement and redevelopment opportunities. We understand that the redevelopment of Mapletree Benoi Logistics is on track for completion in 3QFY14, and that MLT will be embarking on its next redevelopment project at 5B Toh Guan Road in early FY15. We make minor adjustments to our forecasts but lower our fair value marginally to S$1.11 (S$1.15 previously) on higher risk-free rate assumptions. Maintain HOLD. (Kevin Tan) Ascott Residence Trust: Strata sale of units in Somerset Grand Fortune Garden ART has announced that it has entered into a strata sale for the divestment of 81 units in Somerset Grand Fortune Garden, which is located in Chaoyang District, Beijing. The sale consideration for the Somerset Grand Fortune Garden units, when fully sold, is estimated to be RMB628.0m (approximately S$128.1m), as derived from the independent valuation. The amount of excess over book value of the Somerset Grand Fortune Garden units is approximately S$79.9m. It should be noted that the sale consideration for each Somerset Grand Fortune Garden unit will be negotiated on a willing-buyer and willing-seller basis. A third-party owner who owns a total of 100 units in Somerset Grand Fortune Garden had earlier commenced a separate strata sale of the 100 units, resulting in increasing difficulty for ART to continue operating the property. We maintain our FV of S$1.37 and BUY rating on ART. (Sarah Ong) |
For more information on the above, visit www.ocbcresearch.comfor the detailed report. |
NEWS HEADLINES - US stocks rose on Fri, with the S&P 500 index continuing its record run and posting its best weekly gain since mid-July, as investors applauded quarterly results from Google Inc and Morgan Stanley. - DBS Bank has successfully sold S$200m of five-year bonds securitised on a condominium project and based on progress payments, a first since 2008. - Asiasons Capital, Blumont Group and LionGold Corp will have their trading curbs removed on Mon, two weeks after SGX declared them as designated stocks. - UPP Holdings has terminated its proposed investment in the Myanmar project. - DBS Group Holdings is among banks that have advanced in bidding for Societe-Generale's private banking assets in Asia, said three people with knowledge of the matter. - Sembcorp Industries will be investing RMB932m (S$190m) to develop the first total water management plant to support a coal-to-diesel project in China. - Singapore Airlines Cargo and Etihad Cargo have agreed to exchange capacity on services operated by both airlines from Abu Dhabi to London and Frankfurt. |
Stocks to watch
By Ameya Karve and Sarah Gill
Oct. 21 (Bloomberg)
Singapore
* Asiasons (ACAP SP), Blumont (BLUM SP), LionGold (LIGO SP):
Singapore Exchange lifts curbs on cos.; BLUM Chairman-
designate Alex Molyneux says co. can now focus on
accelerating growth of mineral, energy resources business
* CapitaLand (CAPL SP): Repurchases in part all series of
convertible bonds
* Chip Eng (CHIP SP): Launches S$500m multicurrency debt
program; names DBS as arranger, dealer
* Marco Polo Marine (MPM SP): Issues S$50m fixed-rate notes
due 2016
* Sinwa (SKS SP): Albert Chew Khat Khiam resigns as CFO
* UPP (UPP SP): Terminates proposed investment in Myanmar
project
Oct. 21 (Bloomberg)
Singapore
* Asiasons (ACAP SP), Blumont (BLUM SP), LionGold (LIGO SP):
Singapore Exchange lifts curbs on cos.; BLUM Chairman-
designate Alex Molyneux says co. can now focus on
accelerating growth of mineral, energy resources business
* CapitaLand (CAPL SP): Repurchases in part all series of
convertible bonds
* Chip Eng (CHIP SP): Launches S$500m multicurrency debt
program; names DBS as arranger, dealer
* Marco Polo Marine (MPM SP): Issues S$50m fixed-rate notes
due 2016
* Sinwa (SKS SP): Albert Chew Khat Khiam resigns as CFO
* UPP (UPP SP): Terminates proposed investment in Myanmar
project
DBSVickers Report 21 Oct 13
Small Mid Caps - Recent sell down presents
opportunity for quality small mid caps with superior
growth & visibility
We believe that small mid caps will continue to attract
investors interest with its superior growth. Our universe of
SMCs has packed in superior growth of 24% in 2014 vs
12% for Large Caps. Near term winners are potential
earnings outperformers and strong growth. Our picks are
Nam Cheong, Ezion, Goodpack, Centurion and Yoma.
O&G still has legs to run, thanks to new contracts and
strong earnings visibility. We like Ezion, Kreuz and Rex.
Higher volume and lower costs are planting recovery for
CPO stocks – We expect earnings for Bumitama and Indo
Agri to rebound strongly in FY14.
We are lowering our earnings estimates for Courts Asia
for FY14F/FY15F by 10%/16% and TP to S$0.97 (Prev
S$1.05) as we envisage softer sales in Malaysia going
forward and lacklustre sales in Singapore in the near term.
However, we are maintaining our BUY recommendation
on the stock, as valuations are attractive vis-à-vis peers.
Ascott Residence Trust is reaping value from the sale of 81
serviced residence units in Beijing. The proceeds are to be
redeployed to other value enhancing sources. Maintain
BUY and TP S$1.42.
CapitaCommercial Trust’s 3Q13 DPU of 2.04 Scts in line.
Underlying portfolio occupancy shows strength. While
prospective yields of c5.6-5.9% are attractive, the
execution of CapitaGreen, a year away from completion
and has yet to secure first tenant, is key for a sustained rerating
of the stock. Maintain HOLD, TP revised to S$1.46
(Prev S$ 1.43) as we roll forward valuations.
Weak JPY has impacted the performance of Mapletree
Logistics Trust; DPU of 1.82 Scts in line. We are tapering
MLT’s acquisition assumptions but expect more
development projects to be unveiled to extract value.
Maintain BUY with S$1.16 TP. Yield is attractive at 6.5%-
6.9%.
Asiasons Capital and LionGold Corp, along with Blumont,
will have their trading restrictions lifted by the Singapore
Exchange (SGX) today. The regulator said it would lift the
restrictions as trading in these stocks has stabilised.
US Indices Last Close Pts Chg % Chg
Dow Jones 15,399.7 28.0 0.2
S&P 1,744.5 11.3 0.7
NASDAQ 3,914.3 51.1 1.3
Regional Indices
ST Index 3,192.9 6.3 0.2
ST Small Cap 537.2 1.0 0.2
Hang Seng 23,340.1 245.2 1.1
HSCEI 10,644.0 75.3 0.7
HSCCI 4,532.9 7.6 0.2
KLCI 1,799.6 2.2 0.1
SET 1,484.7 15.6 1.1
JCI 4,546.6 27.6 0.6
PCOMP 6,607.8 46.9 0.7
KOSPI 2,052.4 11.8 0.6
TWSE 8,441.2 66.5 0.8
Nikkei 14,561.5 (25.0) (0.2)
STI Index Performance
Singapore
Total Market cap (US$bn) 592
Total Daily Vol (m shrs) 1,897
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price ($)
18 Oct
Target Price
($)
ST Engineering Buy 4.200 4.80
ComfortDelgro Buy 1.910 2.19
OCBC Bank Buy 10.420 12.40
Singapore Airlines Buy 10.320 11.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
17 Oct
Target Price
($)
Ezion Holdings Buy 2.220 3.10
Goodpack Buy 1.780 2.00
CSE Global Buy 0.895 1.07
Mapletree Commercial Trust Buy 1.230 1.35
Frasers Centrepoint Trust Buy 1.845 2.14
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
Rex International Holding restructures its holdings in US
investments and increases stake in licence-holding company
in Trinidad & Tobago. Rex US’s 20% direct interest in Fram’s
Colorado and North Dakota concessions will be exchanged
for equity stake in Fram. Rex’s direct stake in Fram will be
increased to 27.7%. Its stake in the licence-holding company
Caribbean Rex will be increased to 64.17%.
SembCorp Industries will be investing RMB932m (S$190m) to
develop the first - and its most comprehensive - total water
management plant to support a coal-to-diesel project in
China. The plant, to be located in Wangqiao Industrial Park in
Changzhi City, Shanxi province, will support Shanxi Lu'an
Group's coal-to-diesel project under a 15-year service
agreement secured by Sembcorp's wholly owned subsidiary,
Sembcorp China Holding.
The management of People’s Food intends to make a
voluntary conditional offer for all the remaining shares. The
consideration for each Offer Share will be either S$1.20 in
cash and/or One (1) new ordinary share in the capital of the
Offeror.
Work on three MRT stations and a depot for the 30-kilometre
Thomson Line will start in the first quarter of next year, with
the Land Transport Authority (LTA) awarding four civil
contracts for them worth a combined $1.04 bn. The three
stations are Woodlands, Lentor and Mayflower, and the
depot will be in Mandai.
China's annual economic growth quickened to 7.8%
between July and September from 7.5% in the previous
three months, the fastest growth this year and in line with
expectations. In the first nine months of 2013, China grew
7.7%from a year earlier. Meanwhile industrial output grew
10.2% in September from a year ago, versus expectations of
10.1%. Retail sales in September rose 13.3% y-o-y versus an
expected 13.5%. Fixed-asset investment grew 20.2% in the
first nine months from a year earlier, versus an expected
20.3%.-
opportunity for quality small mid caps with superior
growth & visibility
We believe that small mid caps will continue to attract
investors interest with its superior growth. Our universe of
SMCs has packed in superior growth of 24% in 2014 vs
12% for Large Caps. Near term winners are potential
earnings outperformers and strong growth. Our picks are
Nam Cheong, Ezion, Goodpack, Centurion and Yoma.
O&G still has legs to run, thanks to new contracts and
strong earnings visibility. We like Ezion, Kreuz and Rex.
Higher volume and lower costs are planting recovery for
CPO stocks – We expect earnings for Bumitama and Indo
Agri to rebound strongly in FY14.
We are lowering our earnings estimates for Courts Asia
for FY14F/FY15F by 10%/16% and TP to S$0.97 (Prev
S$1.05) as we envisage softer sales in Malaysia going
forward and lacklustre sales in Singapore in the near term.
However, we are maintaining our BUY recommendation
on the stock, as valuations are attractive vis-à-vis peers.
Ascott Residence Trust is reaping value from the sale of 81
serviced residence units in Beijing. The proceeds are to be
redeployed to other value enhancing sources. Maintain
BUY and TP S$1.42.
CapitaCommercial Trust’s 3Q13 DPU of 2.04 Scts in line.
Underlying portfolio occupancy shows strength. While
prospective yields of c5.6-5.9% are attractive, the
execution of CapitaGreen, a year away from completion
and has yet to secure first tenant, is key for a sustained rerating
of the stock. Maintain HOLD, TP revised to S$1.46
(Prev S$ 1.43) as we roll forward valuations.
Weak JPY has impacted the performance of Mapletree
Logistics Trust; DPU of 1.82 Scts in line. We are tapering
MLT’s acquisition assumptions but expect more
development projects to be unveiled to extract value.
Maintain BUY with S$1.16 TP. Yield is attractive at 6.5%-
6.9%.
Asiasons Capital and LionGold Corp, along with Blumont,
will have their trading restrictions lifted by the Singapore
Exchange (SGX) today. The regulator said it would lift the
restrictions as trading in these stocks has stabilised.
US Indices Last Close Pts Chg % Chg
Dow Jones 15,399.7 28.0 0.2
S&P 1,744.5 11.3 0.7
NASDAQ 3,914.3 51.1 1.3
Regional Indices
ST Index 3,192.9 6.3 0.2
ST Small Cap 537.2 1.0 0.2
Hang Seng 23,340.1 245.2 1.1
HSCEI 10,644.0 75.3 0.7
HSCCI 4,532.9 7.6 0.2
KLCI 1,799.6 2.2 0.1
SET 1,484.7 15.6 1.1
JCI 4,546.6 27.6 0.6
PCOMP 6,607.8 46.9 0.7
KOSPI 2,052.4 11.8 0.6
TWSE 8,441.2 66.5 0.8
Nikkei 14,561.5 (25.0) (0.2)
STI Index Performance
Singapore
Total Market cap (US$bn) 592
Total Daily Vol (m shrs) 1,897
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price ($)
18 Oct
Target Price
($)
ST Engineering Buy 4.200 4.80
ComfortDelgro Buy 1.910 2.19
OCBC Bank Buy 10.420 12.40
Singapore Airlines Buy 10.320 11.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
17 Oct
Target Price
($)
Ezion Holdings Buy 2.220 3.10
Goodpack Buy 1.780 2.00
CSE Global Buy 0.895 1.07
Mapletree Commercial Trust Buy 1.230 1.35
Frasers Centrepoint Trust Buy 1.845 2.14
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
Rex International Holding restructures its holdings in US
investments and increases stake in licence-holding company
in Trinidad & Tobago. Rex US’s 20% direct interest in Fram’s
Colorado and North Dakota concessions will be exchanged
for equity stake in Fram. Rex’s direct stake in Fram will be
increased to 27.7%. Its stake in the licence-holding company
Caribbean Rex will be increased to 64.17%.
SembCorp Industries will be investing RMB932m (S$190m) to
develop the first - and its most comprehensive - total water
management plant to support a coal-to-diesel project in
China. The plant, to be located in Wangqiao Industrial Park in
Changzhi City, Shanxi province, will support Shanxi Lu'an
Group's coal-to-diesel project under a 15-year service
agreement secured by Sembcorp's wholly owned subsidiary,
Sembcorp China Holding.
The management of People’s Food intends to make a
voluntary conditional offer for all the remaining shares. The
consideration for each Offer Share will be either S$1.20 in
cash and/or One (1) new ordinary share in the capital of the
Offeror.
Work on three MRT stations and a depot for the 30-kilometre
Thomson Line will start in the first quarter of next year, with
the Land Transport Authority (LTA) awarding four civil
contracts for them worth a combined $1.04 bn. The three
stations are Woodlands, Lentor and Mayflower, and the
depot will be in Mandai.
China's annual economic growth quickened to 7.8%
between July and September from 7.5% in the previous
three months, the fastest growth this year and in line with
expectations. In the first nine months of 2013, China grew
7.7%from a year earlier. Meanwhile industrial output grew
10.2% in September from a year ago, versus expectations of
10.1%. Retail sales in September rose 13.3% y-o-y versus an
expected 13.5%. Fixed-asset investment grew 20.2% in the
first nine months from a year earlier, versus an expected
20.3%.-
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