Forum Index
this forum welcomes all forumers who appreciate decent and well thought out views and discussions. all forumers are encouraged to accept that different forumers have different views and often there is no absolutely right or wrong views.
Menu
 Forum IndexHome
FAQFAQ
MemberlistMemberlist
UsergroupsUsergroups
RegisterRegister
ProfileProfile
Log in to check your private messagesMessages
Log inLogin/Out

Quick Search

Advanced Search

Links
mysingaporenews
Singapore River Tour
Singapore Education
Singapore Orchids
littlespeck
ypapforum
Singapore Hosting
Sample Link 2
Sample Link 2

Who's Online
[ Administrator ]
[ Moderator ]


Google Search
Google

http://www.phpbb.com
DBS Vickers Securities August Reports 2013
Goto page Previous  1, 2
 
Post new topic   Reply to topic     Forum Index -> House Reports and Recommendations
View previous topic :: View next topic  
Author Message
admin
Site Admin


Joined: 01 Jan 1970
Posts: 1350

PostPosted: Mon Aug 26, 2013 9:03 am    Post subject: Reply with quote

Today’s Focus
�� Singapore strategy - Rocky ride ahead, start of QE
tapering an inflexion point; prefer recovery proxies in
US/Europe with yield support
�� Amtek - Improving momentum; upgrade to HOLD, TP
S$0.48
Asia’s emerging markets sold off last week as the derisking
trend continues. DBS Research says while shortterm
pressure may still persist, a repeat of the 1997 Asian
financial crisis (AFC) is unlikely. The accelerated currency,
bonds and equity market slides accentuated the downside
risks to growth as sentiments weakened. But the bigger
and longer lasting reason behind capital inflows into Asia
has always been structural and it will soon return. In the
context of ASEAN, Singapore looks resilient. But a slow
growth and a tightening environment is unlikely to drive
the index.
For the Singapore market, the reversal in fund flows out
of Asia and emerging markets back to developed
economies, triggered by the anticipation of QE tapering,
rising US 10-year treasury yields and a rebound in the
USD, Euro and GBP had exposed the structural
vulnerabilities of emerging market economies with high
current account deficits. While the Singapore market has
outperformed regional bourses, we expect a rocky ride for
Singapore equities, held hostage by the still developing
emerging markets uncertainties.
STI has fallen 10% to 3088 since May 22 when FED
Chairman first hinted of QE tapering. We are close to the
support level of 3050, at 13.1x PE (-0.5SD). Consensus
has been expecting the FED to start to taper in Sept, a
positive signal that the US is on a firmer footing for
recovery, which could provide some stability to the
market. Recovery names should outperform in this
situation while yield sensitive sectors such as SREITs will
remain under pressure. If tapering of QE is pushed back,
volatility continues, and could push STI to test 2900 (12.9x
PE or -1 SD) if the selldown in emerging economies
continues.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 15,010.5 46.8 0.3
S&P �� 1,663.5 6.5 0.4
NASDAQ �� 3,657.8 19.1 0.5
Regional Indices
ST Index �� 3,088.9 (0.6) (0.0)
ST Small Cap �� 541.3 (2.2) (0.4)
Hang Seng �� 21,863.5 (31.9) (0.1)
HSCEI �� 9,932.4 (35.4) (0.4)
HSCCI �� 4,263.5 9.7 0.2
KLCI �� 1,721.1 0.7 0.0
SET �� 1,338.1 (13.7) (1.0)
JCI �� 4,169.8 (1.6) (0.0)
PCOMP �� 6,161.2 24.5 0.4
KOSPI �� 1,879.3 9.1 0.5
TWSE �� 7,873.3 58.9 0.8
Nikkei �� 13,660.6 295.4 2.2
STI Index Performance
Singapore
Total Market cap (US$bn) 569
Total Daily Vol (m shrs) 3,273
12m ST Index High 3,454
12m ST Index Low 2,946
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
23 Aug
Target Price
($)
ST Engineering Buy 3.920 4.80
ComfortDelgro Buy 1.825 2.19
UOL Buy 6.35 8.34
Stock Picks – Small /Mid Cap
Rec’n Price ($)
23 Aug
Target Price
($)
Ezion Holdings Buy 2.380 3.20
Goodpack Buy 1.585 1.90
Nam Cheong Buy 0.275 0.36
Jaya Holdings Buy 0.610 0.90
Venture Corporation Buy 7.660 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
Growing optimism about the improving US recovery and
Europe’s economy moving past the recession trough
should see a return in interest among recovery names and
companies with significant revenue exposure in both
regions. Technology stocks are early recovery plays – CSE
and Venture have significant exposure to US/Europe and
offer attractive yields of 4.7% and 6.7% respectively.
Selected industrials – Ezion and Goodpack will leverage
on their niche positions in the global arena. Stocks with
earnings visibility supported by yield are likely to remain in
favour - our picks are SingPost, Comfort Delgro, ST
Engineering and Hutchison Port. Avoid stocks with
exposure to emerging markets which are likely to
Underperform - Petra, Acott REIT, Religare, AIT and
SingTel.
4Q13 core earnings for Amtek Engineering were below
but sequential improvement suggests worst is over for
now. New programmes and continuous cost
management are expected to drive core earnings growth.
Upgrade to HOLD, upped TP to S$0.48 on earnings
rollover to FY14F.
Jaya Holdings has signed a contract to charter its new
build DP2 Platform Supply Vessel (PSV) “Jaya Vigilant” for
a long term operation in the Indian Ocean, offshore
Mozambique. The two year contract, which includes
charterer’s options has a value of more than US$20m.
According to Reuters, the Indonesian government has
released a slew of measures to combat the declining
Rupiah. Amongst them is to increase mandatory position
of biodiesel used in diesel and expediting investment in
crude palm oil by giving tax holidays and tax allowances
as incentives.
Our view :-
On biodiesel:
Doubling the mandatory blend of biodiesel to 10% (as
was suggested by Deputy Minister for Energy and Mineral
Resources in its website) should theoretically raise
domestic biodiesel consumption to 1,600m litres from
800m litres; and increase Indonesian biodiesel production
to roughly 3.0m MT in FY14. This assumes a 10% decline
in biodiesel exports due to EU anti-dumping tariffs. CPO
consumption of 3.0m MT for biodiesel would represent
c.39% of Indonesia's projected FY14 palm oil demand of
7.6m MT. If realised, we believe this would reduce global
palm oil inventory significantly and boost palm oil
prices/export value. However, we remain sceptical
whether such policy would remain should palm oil prices
jump to the detriment of cooking oil consumers in
Indonesia.
On palm oil investment:
Although tax holidays and tax incentives are good news,
we remain concerned on the implementation of the
above proposed changes on plantation owners.
On effectiveness in shoring up Rupiah:
We believe the above plans would not have any
immediate impact on the Rupiah, as reduced diesel
imports would be gradual.
CWT has entered into an agreement to acquire the entire
100% equity stake in Sinsenmoh Transportation for
S$19m cash. Established in 1978, SSM is a Singapore
logistics company which undertakes chemical
warehousing and transportation activities in Singapore.
The acquisition of SSM is part of CWT’s ongoing efforts
to enhance the Company’s chemical storage, handling
and transportation capabilities.
Giken Sakata is placing up to 55.2m new shares at an
issue price of S$0.024 each. The issue price represents a
discount of approximately 32.4% to last volume price.
Net proceeds of about S$3.0m will be used for repayment
of loans and general working capital of the group.
In property news, development charges are generally
expected to go up from Sept 1 on the back of higher land
prices over the past six months. However, the pace of
hikes may be conservative in line with the objective of
promoting a stable property market, said some property
consultants polled by BT. For the upcoming revision,
property consultants expect the average DC rate for
commercial use to rise between 3 and 10 per cent. For
landed residential use, a smaller rise is predicted, between
0 and 5 per cent.
Inflation in Singapore inched up slightly to 1.9% in July
from 1.8% in June, as private road transport costs
rebounded after two consecutive months of decline,
thanks in part to higher car prices. The market does not
expect price pressures to remain contained below 2% for
much longer - and certainly not beyond 2013 - as
restructuring pains and a tight labour market will
continue to drive up wages and consumer prices.
U.S. stocks rose as investors watched FED officials for
signals on stimulus cuts after data showed home sales
plunged. Purchases of new U.S. homes plunged 13.4% in
July to 394k; the most in more than 3 years that raised
concern higher mortgage rates will slow the real-estate
rebound. The reading was the weakest since October and
was lower than any of the forecasts by 74 economists
that Bloomberg surveyed. The 10-yr treasury yield eased
to 2.81%. Meanwhile, FED officials have rebuffed
international calls to take the threat of emerging markets
fallout into account when tapering US monetary stimulus.
Back to top
View user's profile Send private message Send e-mail
admin
Site Admin


Joined: 01 Jan 1970
Posts: 1350

PostPosted: Tue Aug 27, 2013 9:02 am    Post subject: Reply with quote

Today’s Focus
 Silverlake Axis – 2% ahead on earnings, better than
expected dividends with yield of 4%.
Silverlake Axis reported FY13 (Jun YE) profit of RM196m,
2% ahead of our estimate due to slightly better gross
margins coming in at 63.7%. Revenue of RM399m, flat yo-
y, was inline. Gross margins improved significantly due
to lower hardware sales and rise in software licensing and
maintenance revenue. Better than expected dividends
with payout ratio of ~80%. Proposed final dividend of
Singapore 1.1 Scts, resulting in total FY13 DPS of 3.1 Scts,
up 63% y-o-y, exceeded our 2.6S Scts forecast. The stock
is trading at FY13 dividend of 4.1% now. We will provide
more updates post discussion with management.
Cord blood bank Cordlife Group saw its fiscal 2013 net
profit rise nearly 95% to $13.5m from a year ago due to
healthy revenue growth, strong margins and a $2.7m
one-time gain from disposal of a stake in associate China
Stem Cells (South) Co. The group continues to maintain a
high, consistent level of gross profit margin of about
73%.
Tiong Woon Corp reported a net profit of $17.6m for FY
Jun 13, reversing from a net loss of $4.85m last year. The
improvement came on the back of a 36% growth in
turnover to $200.5m. The higher turnover was attributed
mainly to contributions from its heavy lift and haulage,
engineering services and trading segments. The group
expects business conditions to be challenging due to
uncertainties in the world economy, higher labour and
other operating costs.
CapitaLand’s wholly-owned serviced residence business
unit, The Ascott, has secured a contract to manage its first
Citadines Apart’hotel in Hangzhou. Scheduled to open in
late 2014, the 100-unit Citadines Intime City Hangzhou
will be Ascott’s 11th Citadines Apart’hotel in China.
KS Energy and PT Pertamina Drilling Services Indonesia
(PDSI) are setting up a new joint venture company to own
and operate drilling rigs in Indonesia. They jointly
operated drilling rigs valued at around US$130m. The
new joint venture company intends to take over the
contracts held by the existing joint operations and tender
for new contracts in Indonesia.
US Indices Last Close Pts Chg % Chg
Dow Jones  14,946.5 (64.1) (0.4)
S&P  1,656.8 (6.7) (0.4)
NASDAQ  3,657.6 (0.2) (0.0)
Regional Indices
ST Index  3,084.4 (3.3) (0.1)
ST Small Cap  534.0 (7.5) (1.4)
Hang Seng  22,005.3 141.8 0.6
HSCEI  10,075.1 142.7 1.4
HSCCI  4,269.8 6.4 0.1
KLCI  1,722.5 1.4 0.1
SET  1,329.2 (9.0) (0.7)
JCI  4,120.7 (49.2) (1.2)
PCOMP  6,161.2 24.5 0.4
KOSPI  1,887.9 17.7 0.9
TWSE  7,895.0 21.7 0.3
Nikkei  13,636.3 (24.3) (0.2)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 569
Total Daily Vol (m shrs) 4,372
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
26 Aug
Target Price
($)
ST Engineering Buy 3.87 4.80
ComfortDelgro Buy 1.825 2.19
UOL Buy 6.35 8.34
Stock Picks – Small /Mid Cap
Rec’n Price ($)
26 Aug
Target Price
($)
Ezion Holdings Buy 2.37 3.20
Goodpack Buy 1.585 1.90
Nam Cheong Buy 0.275 0.36
Jaya Holdings Buy 0.61 0.90
Venture Corporation Buy 7.70 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
Singapore’s manufacturing sector expanded 2.7% y-o-y
in July, better than market expectations of a 1.2% rise,
thanks to a continued improvement in electronics output.
The higher export demand for semiconductors and
computer peripherals - which grew 2.3% and 14.7%
respectively - helped to offset a 1.3% contraction in
biomedical output due to weak pharmaceuticals numbers.
However, on a m-o-m basis, overall factory output
declined 1.9%. This marked a second consecutive month
of sequential contraction; industrial production fell 2% in
June. Both the electronics and biomedical sectors - which
together account for over half of Singapore's
manufacturing economy - saw lower levels of production
in July than in June this year. Our economist highlighted
that there are still external headwinds, so there is a very
good chance to see pull-back in (factory output) in Q3. He
also noted that emerging market risks from Singapore's
key trading partners - such as Malaysia, Indonesia and
India - could have a "significant impact" on Singapore.
US stocks gave up early session gains to end lower after
the Secretary of State said America will hold the Syrian
government accountable for using chemical weapons,
which raised speculation of a retaliation strike. Oil price
rose on the news. Stocks had start the session higher
after a weaker-than-expected July durable goods orders
(actual -7.3%, consensus -4%) raised speculation that the
FED might delay tapering QE in September. The figure
was the largest decline since August 2012.
Back to top
View user's profile Send private message Send e-mail
admin
Site Admin


Joined: 01 Jan 1970
Posts: 1350

PostPosted: Wed Aug 28, 2013 9:14 am    Post subject: Reply with quote

Today’s Focus
 STI – Fall below 3065 points to 2880 but not before a
rebound from 3000 towards 3100
 Goodpack - Growth on track; maintain BUY with higher
TP of S$2.00
STI’s decline beneath June’s low of 3065 yesterday
signaled a resumption of the downtrend that points to
2880 on the technical charts, which coincides with 12.3x
(-1SD) 2860 blended FY13F/14F PE. In coming sessions
though, a technical rebound off the 3000 level towards
3100 is expected. Transport and airline stocks could
underperform while O&M names hold up better as oil
price rallied. Brent crude added c.5% to USD105pbl.
FY13 results for Goodpack slightly above. The key variants
were the US$1.4m disposal gain of PPE and US$0.9m
forex gain in 4Q13. Goodpack is on track to achieve
volume growth of 250k boxes in FY14, underpinned by
the firm ramp up of new SR markets in Singapore and
Russia. It is also gaining traction in the autoparts market.
Maintain BUY with higher TP of S$2.00. The finalisation of
autopart contracts serve as an imminent catalyst.
2Q13 results for IHH Healthcare within expectations.
EBITDA margins improved with positive contribution
from new hospitals. Novena hospital turned in RM2m
EBITDA profit, on track for positive contribution in FY13.
Maintain HOLD, TP adjusted to S$1.50 (Prev S$ 1.55),
accounting for recent currency effects. While we believe
the long term prospects for healthcare remains positive
and IHH commands a premium due to its scarcity and
geographical spread, the stock is already trading at
43x/36x on FY13F/14F earnings.
Update on Singapore property – office and retail segment.
For the office segment, we see the nascent signs of
strength in the office leasing market as a temporary
mismatch between demand and supply. Net positive take
up of 0.2msf in 1H13 coupled with c0.16msf of older
office space taken out of circulation squeezed occupancy
a tad higher to 91.2% and lifted rents by 0.2% in 1H.
Going forward, with 83% of 2013’s new supply being
completed in 2H, tenant relocations and re-leasing
activities and frictional vacancies would mean a lacklustre
outlook. We expect office rents to end the year relatively
US Indices Last Close Pts Chg % Chg
Dow Jones  14,776.1 (170.3) (1.1)
S&P  1,630.5 (26.3) (1.6)
NASDAQ  3,578.5 (79.0) (2.2)
Regional Indices
ST Index  3,034.0 (50.4) (1.6)
ST Small Cap  526.4 (7.6) (1.4)
Hang Seng  21,874.8 (130.5) (0.6)
HSCEI  9,988.2 (86.9) (0.9)
HSCCI  4,254.6 (15.2) (0.4)
KLCI  1,701.2 (21.3) (1.2)
SET  1,294.0 (35.2) (2.6)
JCI  3,967.8 (152.Cool (3.7)
PCOMP  5,917.0 (244.2) (4.0)
KOSPI  1,885.8 (2.0) (0.1)
TWSE  7,820.8 (74.1) (0.9)
Nikkei  13,542.4 (93.9) (0.7)
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$bn) 569
Total Daily Vol (m shrs) 3,635
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
27 Aug
Target Price
($)
ST Engineering Buy 3.85 4.80
ComfortDelgro Buy 1.80 2.19
UOL Buy 6.19 8.34
Stock Picks – Small /Mid Cap
Rec’n Price ($)
27 Aug
Target Price
($)
Ezion Holdings Buy 2.30 3.20
Goodpack Buy 1.54 1.90
Nam Cheong Buy 0.265 0.36
Jaya Holdings Buy 0.605 0.90
Venture Corporation Buy 7.58 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
unchanged at 0% to -5% (vs - 5% to -8% previously)
and occupancy to hover around the 89-90% mark. Our
strategy would be to prefer landlords with exposure to
the CBD or the Central areas given that a large part of the
fringe office and business parks space has been absorbed.
On the one hand, demand for retail space is robust but
costs are rising. We expect retail rents to trickle up by 2%
this year; high pre-commitment rates in 2H13 should
stabilise rents, while the large incoming supply, to the
tune of c10% of total inventory till 2017, largely in the
fringe areas, may cap near term upside.
Whilst we have a neutral weighting on both sectors, we
have a preference for retail over office as retail landlords
can typically conduct AEIs to boost growth. In terms of
stock picks, we adopt a stock picking strategy to identify
value. We are buyers of UOL given its resilient diversified
business model and strong management track record. The
stock is currently trading at a 24% discount to our TP of
$8.34, premised on a 15% discount to RNAV. Amongst
the REIT space, we like Suntec REIT as it would benefit
from its extensive AEI. The Reit offers FY13 yield of 6%
and total return of 24%.
AusGroup reported a 93.6% plunge in fourth-quarter net
profit to A$525,000, from A$8.25m a year ago.
Reduction in revenue from its integrated services division
resulted in group turnover for the three months ended
June falling 21.5% to A$137.6m. Additionally, gross
profit margin fell 3.3 percentage points to 10.5%,
dragging gross profit down 40.1% to A$14.4m. Full-year
profit fell 58.4% to A$9.7m, with turnover decreasing
7.8% to A$582.7m. Revenue growth from the major
projects and fabrication divisions were offset by a
reduction in revenue from the integrated services division.
The group was also impacted by decreased activity in the
resource sector as major resource companies scaled back
capital expenditure following volatility in commodity
prices, as well as customer delays in awarding contracts in
the oil and gas sector. Gross margin for the year slipped
to 10.9% from 12.4%. AusGroup has a current order
book of A$200m.
Sembcorp announces the expansion of its water business
in China’s Liaoning province with two new wastewater
treatment projects in industrial parks in Panjin city. Its
wholly-owned subsidiary Sembcorp China will sign
agreements for new wastewater treatment projects in
Panjin City’s Panjin Fine Chemical Industrial Park and
Panjin Liaodong Bay New District. The first of the
agreements will be a joint venture agreement to build,
own and operate a new RMB117.3m industrial
wastewater treatment plant to serve industrial customers
in Panjin Fine Chemical Industrial Park (PFCIP). The second
agreement to be signed will be a non-binding agreement
with the Panjin Liaodong Bay New District Administrative
Committee, which supplements an exclusive concession
granted to Sembcorp for the provision of wastewater
treatment to companies located in a 60.3-square
kilometre industrial park in the west of the Panjin
Liaodong Bay New District.
Mirach Energy has unexpectedly uncovered a new
untapped oil zone at the Kampung Minyak Oil Field (KM)
as it drilled deeper at the KM-607 infill well. This zone is
below the old production oil layer. With the strong results
shown in the newly uncovered oil zone, the company
intends to apply to Pertamina EP to drill new wells deeper
than 1000 metres to confirm the other potential pay
zones that it has identified in KM.
China Aviation Oil has signed a product storage
agreement with Horizon Singapore Terminals to lease
storage facilities at Jurong Island, for three years as from
1 September 2013. Under the terms of the agreement,
CAO agreed to lease five storage tanks with a combined
storage capacity of about 174,000 cubic metres. The
leased storage tanks will be used for fuel oil and fuel oil
blend components.
KSH Holdings has been awarded a S$98.9m construction
contract for the construction of NEWest, a mixed-use
development located at West Coast Drive in District 5.
Construction for NEWest is expected to commence in
September 2013, with completion expected within 30
months. Year-to-date, KSH has won construction projects
amounting to S$301.1m in Singapore and RMB157.0m in
Beijing, PRC. KSH’s existing construction order book,
which stands at approximately S$478m, is expected to
contribute to the Group’s financial results up till FY2016.
Tighter housing loan limits and restrictions on permanent
residents have been imposed for the purchase of HDB
resale flats, which could drive up demand for the rental
and private residential markets in the next three years.
The latest series of measures - which include a three-year
wait before newly-minted PRs can buy a resale flat - may
rejuvenate the private residential sector, which is
expecting an onslaught of supply up to 2016. Other
measures include reducing the maximum tenure for
public housing loans to 25 years from 30. Flat buyers who
take HDB loans can now use only up to 30% of their
gross monthly income to repay their loans, down from
35%.
Passenger traffic at Changi Airport rose 4% y-o-y in July.
The total number of passengers that passed through the
airport in the first seven months of this year hit 30.8m -
4.9% higher than last year. Strong demand for air travel
to and from south-east Asia, north-east Asia, the southwest
Pacific and the Middle East contributed to the
Singapore
Wired Daily
Page 3
growth in passenger traffic for the month. Among the
top 10 destination cities for flights out of Changi were
Bali-Denpasar, Sydney, Taipei and Tokyo. All recorded
double-digit growth in passenger movements. Air traffic
movements for the month grew by 6.9% y-o-y while
cargo passed through Changi last month was a slight
improvement of 1.1% from the previous year.
US stocks fell as tension grew over a possible military
action against Syria after Secretary of State said America
will hold the Syrian government accountable for using
chemical weapons. It is not clear whether the US would
seek a mandate from the UN for potential responses.
Russia had blocked previous UN action against Syria while
Iran warns that a military strike will destabilize the region.
Airlines fell as oil price rose. Stocks sold off even as data
showed consumer confidence unexpectedly increased in
August. According to US and UK officials, any army
response will be narrowly focused on Syria’s chemical
capabilities. The flight to safety saw 10-year treasury
yields dipped to 2.7%.
Investors are also watching the political wrangling over
the approaching limit on federal spending. The U.S.
government is expected to exhaust its ability to borrow
funds by mid-October when it will hit the statutory debt
limit, this according to an estimate from the Treasury
Department.
Back to top
View user's profile Send private message Send e-mail
admin
Site Admin


Joined: 01 Jan 1970
Posts: 1350

PostPosted: Thu Aug 29, 2013 9:10 am    Post subject: Reply with quote

Today’s Focus
�� STI - Technical rebound from c.3000 towards 3100
before heading towards 2880 major support
Asian equity indices of Japan and Korea are starting
Thursday’s session higher as oil price pulled back and the
Rupee rebounded, easing pressure on the equity sell-off.
For the STI, continue to scope for a technical rebound
from c.3000 towards 3100 before heading lower again
towards 2880 major support.
United Envirotech announced a RMB90m (~S$19m) EPC
contract to upgrade a 100,000m3/day industrial
wastewater treatment plant in Nantong City, Jiangsu
Province, China. This wastewater treatment plant serves
industries located in the Nantong Economic Development
Zone and about 70% of the wastewater is from textile
industry. Upgrading of the plant is required to meet the
more stringent Grade 1A discharge standard imposed by
the local government. This project will commence
construction immediately and is expected to be completed
by the end of Dec 2013. Together with a RMB100m
contract announced last week, United Envirotech has met
~50% of our FY14 new win assumption of RMB400m. No
change to our forecast, S$0.90 TP and Hold call.
Sin Heng Heavy Machinery reported a surge of 45.1% yo-
y in net profit to S$13.7m for its financial year ended 30
June 2013. The higher profit was due to a 44.3% y-o-y
increase in revenue to S$186.5m which was a result of
broad-based improvement across geographical markets
and business segments. Revenue of trading segment
increased 49.3% to S$133.0m mainly due to the higher
volume of cranes traded, whereas revenue of equipment
rental segment improved 33.3% to S$53.5m mainly due
to the increase in revenue from expanded fleet size. Gross
profit margin improved to 16.2% for FY2013 from 15.8%
for FY2012.
Q & M offers S$6m to acquire a 60% stake in the largest
dental hospital in Donggang, PRC, to strengthen its
presence in North-Eastern China. The proposed
acquisition will involve the acquisition of two dental
hospitals operated and owned by Dr Sun Zhizong. Q & M
will receive a profit guarantee of at least $600k (RMB3m)
per year starting from 2014 for a 12-year period until
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,824.5 48.4 0.3
S&P �� 1,635.0 4.5 0.3
NASDAQ �� 3,593.4 14.8 0.4
Regional Indices
ST Index �� 3,004.2 (29.Cool (1.0)
ST Small Cap �� 521.6 (4.Cool (0.9)
Hang Seng �� 21,524.7 (350.1) (1.6)
HSCEI �� 9,765.2 (223.0) (2.2)
HSCCI �� 4,164.7 (89.9) (2.1)
KLCI �� 1,686.2 (15.1) (0.9)
SET �� 1,275.8 (18.2) (1.4)
JCI �� 4,026.5 58.6 1.5
PCOMP �� 5,738.1 (178.9) (3.0)
KOSPI �� 1,884.5 (1.3) (0.1)
TWSE �� 7,824.5 3.7 0.0
Nikkei �� 13,338.5 (203.9) (1.5)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 557
Total Daily Vol (m shrs) 3,268
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
28 Aug
Target Price
($)
ST Engineering Buy 3.880 4.80
ComfortDelgro Buy 1.780 2.19
UOL Buy 6.120 8.34
Stock Picks – Small /Mid Cap
Rec’n Price ($)
28 Aug
Target Price
($)
Ezion Holdings Buy 2.180 3.20
Goodpack Buy 1.580 2.00
Nam Cheong Buy 0.265 0.36
Jaya Holdings Buy 0.600 0.90
Venture Corporation Buy 7.540 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
2026. The proposed acquisition exercise is expected to be
completed on 1 February 2014 and will be funded by
internal cash, loans and/or issuance of new Q & M shares.
Intraco has joined forces with Tat Hong and a Myanmar
businessman to set up a joint venture company to enter
the crane rental and excavator distribution business in
Myanmar. Called Tat Hong Intraco, the Singapore JV will
hold the licence with various principals and engage in the
distribution of cranes and excavators in the rapidlydeveloping
nation. It will also incorporate Tat Hong
Intraco Heavy Equipment, a wholly owned subsidiary in
Myanmar, which will rent out cranes and run related
business activities there.
Moody’s Investors Services has upgraded Keppel REIT’s
corporate family rating to Baa2 with a stable outlook.
Moody’s has assigned the improved rating based on
Keppel REIT’s enlarged and quality asset portfolio in
Singapore and Australia; strong operating performance;
as well as proactive capital management, which minimises
its refinancing risk for the next 12 to 18 months.
Stamford Tyres Corporation has completed the sale of its
property located at 207 Balestier Road for S$6.3m cash.
The net proceeds from the sale will be used for the
Group’s business and to fund the Group’s investment in
its distribution and warehousing capabilities as well as for
working capital purposes. The Group is expected to
record a net gain of approximately S$5.5m after taking
into account the net book value of the Property and the
expenses relating to the sale.
A freehold hotel development site at Lavender has been
put up for sale with a guide price of about $28m to
$30m. The 3,516 square feet site has been granted
provisional permission for the development of a six-storey
hotel comprising 60 rooms. The guide price works out to
be about $466,000 to $500,000 per room.
US stocks rebounded, led by energy shares as investors
watched developments in Syria. Russia had objected to a
UN resolution authorizing action to protect civilians. A
State Department spokeswoman said the U.S. will take
“appropriate” steps without the international body’s
approval. The U.S. and its NATO allies began presenting
their justification for military action as they advanced
plans for launching strikes and prepared evidence that the
Syrian government used chemical weapons on its own
people. Meanwhile, the index of pending home sales for
July fell 1.3% (consensus unchanged), the worst reading
this year, after a 0.4% decrease in June.
Back to top
View user's profile Send private message Send e-mail
admin
Site Admin


Joined: 01 Jan 1970
Posts: 1350

PostPosted: Fri Aug 30, 2013 9:19 am    Post subject: Reply with quote

Today’s Focus
 Olam - Outlook remains challenging with weak
commodity prices and macro uncertainties; maintain
HOLD, TP cut to S$1.60
Olam’s FY13 net profit missed ours and consensus’
estimate by 19% / 23% on higher tax rate.
Operating environment remains challenging in view of the
macro uncertainties, currency depreciation in emerging
markets and weak commodity prices. Management
continues to emphasize on its strategy to rebalance
growth and cash flow to bring free operating cash flow
back to positive territory by end of FY14. We have
trimmed our FY14/15 core profit by 17%/5%. Maintain
HOLD with a lower TP of S$1.60 (Prev: S$1.80).
Ezion has signed a charter contract to provide bareboat
charter for a refurbished jack up rig worth US$49.1m over
four years. Upgrading and refurbishment work is expected
to commence at the Middle East yard next week and the
rig is scheduled to be delivered to a national oil company
in Middle East by mid-2014. The cost of the project –
US$40m - will be funded by equity (30%) and 5-year
floating bank borrowings (70%). We are keeping our
forecasts intact, with the expectations of three additional
contracts this year and eight next year. Maintain BUY on
Ezion with an unchanged TP of S$3.20. We continue to
like Ezion’s strong growth profile and earnings visibility.
China Minzhong reported a 4.9% decline in 4Q net profit
to RMB162.7mil for the period ended June. FY net profit
rose 11.1% to RMB755.1mil. A dividend of one Singapore
cent/share was declared. Trade receivables turnover days
increased by 31 days to 116 days. In a statement,
Minzhong said that Glaucus misunderstood its business.
The company said it has done a preliminary review of the
report and notes that most of the issues raised by Glaucus
with regard to the financials of the company. Minzhong
claims these were nothing new and arose out of a
complete lack of understanding of the company's
business model as well as the operating environment in
China.
Global Logistic Properties has signed expansion lease
agreements totaling 21,000 sqm with one of the top
three e-commerce companies in China. The new leases
are in Chengdu, Midwestern China, and Qingdao, Eastern
China.
US Indices Last Close Pts Chg % Chg
Dow Jones  14,841.0 16.4 0.1
S&P  1,638.2 3.2 0.2
NASDAQ  3,620.3 27.0 0.8
Regional Indices
ST Index  3,038.0 33.9 1.1
ST Small Cap  524.4 2.8 0.5
Hang Seng  21,704.8 180.1 0.8
HSCEI  9,850.7 85.5 0.9
HSCCI  4,213.7 49.0 1.2
KLCI  1,703.8 17.6 1.0
SET  1,292.5 16.8 1.3
JCI  4,103.6 77.1 1.9
PCOMP  5,944.2 206.2 3.6
KOSPI  1,907.5 23.0 1.2
TWSE  7,917.7 93.1 1.2
Nikkei  13,459.7 121.3 0.9
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 554
Total Daily Vol (m shrs) 4,178
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
29 Aug
Target Price
($)
ST Engineering Buy 3.99 4.80
ComfortDelgro Buy 1.78 2.19
UOL Buy 6.28 8.34
Stock Picks – Small /Mid Cap
Rec’n Price ($)
29 Aug
Target Price
($)
Ezion Holdings Buy 2.26 3.20
Goodpack Buy 1.63 2.00
Nam Cheong Buy 0.265 0.36
Jaya Holdings Buy 0.61 0.90
Venture Corporation Buy 7.65 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
Grand Bank Yachts is proposing to issue a renounceable
non-underwritten rights issue of up to 57.7m new shares
on the basis of 1 rights share for every 2 existing shares
held at S$0.22 per share. The issue price is at a discount
of about 26.6% to the last volume weighted average
price. The net proceeds of about S$12.4m will be used to
fund the company’s investment initiatives and for general
working capital.
Tritech Group is proposing to acquire Anhui Clean
Environment Biotechnology in China for RMB10m. The
proposed acquisition will enable the Group to further its
venture into the water and waste water business in the
PRC by tapping on the target company’s existing licenses,
management, track record and clientele.
Ntegrator International has secured two new contracts
worth approximately S$6.5m from repeat customers,
Myanmar Radio and Television and the Viettel Group of
Companies. Year-to-date order win is at a record high of
over S$71m. These repeat orders are testimony to the
Group’s strong reputation for quality and service delivery
with key players in the industry.
In property news, the government has released four
industrial sites for tender - two in Gambas Crescent in the
Sembawang/Woodlands area and two in Tuas South.
These are the first four plots to be offered under the
confirmed list of the second-half 2013 Industrial
Government Land Sales (GLS) Programme.
Indonesia's central bank increased both its benchmark
interest rate and its overnight deposit facility rate by 50
basis points yesterday, in its latest attempt to defend the
rupiah, which is Asia's second worst performing currency
this year. Bank Indonesia hikes benchmark reference rate
to 7.0% and Fasbi to 5.25%. The country has been
among the hardest hit by the retreat from emerging
market currencies and stocks over the past two weeks,
driven by worries that the US Federal Reserve will soon
start closing the tap on cheap money that has been
helping drive up their economies.
US stocks rebounded after 2Q GDP rose a better-thanexpected
2.5% (consensus 2.2%) and weekly jobless
claims fell 6k to 331k (consensus 332k). Meanwhile,
market worry of an imminent strike on Syria receded after
UK and France said they favour waiting for the findings of
the UN investigation into alleged use of chemical
weapons. Oil price fell with Brent crude down 1.3% to
USD115.1pbl.
Back to top
View user's profile Send private message Send e-mail
Display posts from previous:   
Post new topic   Reply to topic     Forum Index -> House Reports and Recommendations All times are GMT + 8 Hours
Goto page Previous  1, 2
Page 2 of 2

 
Jump to:  
You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum


Powered by phpBB © 2001, 2002 phpBB Group. Hosted by Vodien Internet Solutions