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DBSVickers Report February 2013
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PostPosted: Fri Feb 01, 2013 9:48 am    Post subject: DBSVickers Report February 2013 Reply with quote

Today’s Focus
• Yoma Strategic - Stock needs to consolidate its strong
run; downgrade to HOLD.
Market participants could overlook a second day moderate
decline on Wall Street dragged by corporate earnings and
focus instead on the US Jan job numbers scheduled for release
tonight. Consensus expects 165k increase in non-farm payrolls
while unemployment stays at 7.8%. Meanwhile, China’s Jan
manufacturing PMI released this morning rose a lesser than
expected 50.4 (consensus 51) although still stayed in
expansion territory. Non-manufacturing PMI will be released
over the weekend.
3Q13 results for Yoma Strategic fell short despite all rounded
growth. The take up for property sale is healthy, and prices are
higher. Our analyst has cut FY13F-15F EPS by 47-59%
primarily to reflect slower construction. TP is adjusted
marginally to S$0.80 (Prev S$ 0.79), downgrade to HOLD on
limited upside.
Shareholders at an extraordinary general meeting unanimously
approved Tiger Airways' sale of a 60% stake in the lossmaking
Tiger Airways Australia to Virgin Australia for A$35m
in cash. The deal now awaits an opinion, expected next week,
by the Australian Competition and Consumer Commission
(ACCC).
Rotary Engineering has clinched a $300m expansion project
for Singapore oil trader Kuo Oil's Tankstore oilfarm here. It
expects to start work immediately on the two-year project on
Pulau Busing, located off south-west Singapore. The new win
brings its current order book to approximately $750m.
JES International is expected to incur a loss for FY2012. The
Group has made prudent charges and provision for liquidated
and ascertained damages over late delivery of some vessels
and reduced contract prices for certain vessels.
Lafe Corporation is expected to record a significantly reduced
profit for FY Dec 12 as compared to the previous year. The
profit reduction primarily resulted from the impairment in
value of the Group's investment property at Emerald Hill,
Singapore which takes into account the impact of the recent
Singapore Government cooling measures.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,860.6 (49.Cool (0.4)
S&P �� 1,498.1 (3.9) (0.3)
NASDAQ �� 3,142.1 (0.2) (0.0)
Regional Indices
ST Index �� 3,282.7 (3.2) (0.1)
ST Small Cap �� 570.1 (1.1) (0.2)
Hang Seng �� 23,729.5 (92.5) (0.4)
HSCEI �� 12,130.6 (41.6) (0.3)
HSCCI �� 4,698.8 (40.1) (0.Cool
KLCI �� 1,627.6 (0.2) (0.0)
SET �� 1,474.2 (16.6) (1.1)
JCI �� 4,453.7 0.7 0.0
PCOMP �� 6,242.7 (28.5) (0.5)
KOSPI �� 1,961.9 (2.5) (0.1)
TWSE �� 7,850.0 17.0 0.2
Nikkei �� 11,138.7 24.7 0.2
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 631
Total Daily Vol (m shrs) 4,555
12m ST Index High 3,286
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
31 Jan
Target Price
($)
Hutchison Port Holdings Trust Buy 0.820 0.88
Noble Group Buy 1.220 1.50
Capitamall Asia Buy 2.160 2.30
Neptune Orient Lines Buy 1.285 1.45
Keppel Corp Buy 11.500 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
31 Jan
Target Price
($)
Jaya Holdings Buy 0.710 0.85
Tiger Airways Buy 0.765 0.95
Ezra Holdings Buy 1.190 1.58
Tat Hong Holdings Buy 1.540 1.80
China Merchants Buy 0.900 1.20
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Matex International is proposing to place up to 10.3m new
shares at an issue price of S$0.0473 per share, which is at a
discount of 9.7% to the last weighted average price. The
gross proceeds of up to approximately S$487,190 will be
used for general working capital.
Swee Hong is expected to report a loss for 2Q13 and 1H13.
The expected loss is attributable to: 1) decline in revenue
from operations; and 2) significant costs increases.
AEI Corporation is expected to report significantly weaker
operating performance for FY12 than that in FY 11, due to
weak demand.
Loan growth for Singapore banks rebounded in Dec 12
bringing full year 2012 loan growth to 10.4%. Banks’
guidance for high single digit loan growth may materialise
judging from these numbers. Growth appears to be domestic
driven, led by business loans. Housing loan growth remained
strong. Despite measures to cool the property market in Oct
12, housing loans remained on a strong growth path, ending
the year at 15.9% y-o-y (2011: 16.7%), ahead of
expectations. We expect housing loan growth to be
supported by drawdown of mortgage applications over the
next 1-2 quarters, but could gradually drop after that. We
forecast mortgage loans will grow by 8% in 2013, noting
that there is still a market for natural new home buyers and
HDB upgraders taking into account the measures
implemented in Oct 12 and Jan 13.
Strong traffic from all key regions and increasing transit flows
enabled Singapore Changi Airport to boast its busiest year
ever in 2012, as it crossed the 50 million passenger
movements mark for the first time in its 31-year history.
Passenger traffic for the year totalled 51.2 million, as traffic
to and from all regions and transit passenger numbers
surged. Last year's passenger traffic numbers are 10% higher
than 2011's (46.5 million) and a full 10 million passengers
more than the 42 million it hosted in 2010. Flight movements
grew 7.6% to 324,700, but cargo volumes declined 3.2% to
1.81 million tonnes. Changi recorded increased traffic to and
from all regions of the world last year, except the Africas,
where political turmoil hit the air travel industry. Changi's top
markets by country were Indonesia, Malaysia, Thailand,
Australia and China.
Companies in the manufacturing and services sectors expect
business prospects to be weak in the first half of this year as
global economic growth remains sluggish. A survey by the
Economic Development Board (EDB) shows that firms see the
outlook remaining tepid in the first six months of 2013 as the
state of the global economy continues to take its toll on
business sentiment here. Within the manufacturing sector,
the biomedical and general manufacturing clusters were the
most bullish. The pharmaceutical segment sees higher
demand coming from overseas while general manufacturing
firms such as those in the food, beverages and tobacco
segments expect demand to receive a boost from seasonal
factors such as Chinese New Year. The electronics cluster was
the least optimistic.
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PostPosted: Mon Feb 04, 2013 10:39 am    Post subject: Reply with quote

Today’s Focus
 Hutchison Port Holdings Trust – Expect DPU to be
sustainable at 6.0UScts (c.7.5% yield) in FY13. Maintain
BUY at revised TP of US$0.85
STI looks set to overcome the 9 Nov10 high of 3313 to make a
new post-GFC high. However, we see the index capped
comfortably below 3400 in the course of the current results
season. That is, while the index may venture a little beyond the
average 12-mth forward PE, it won’t go much further beyond
that in the absence of aggressive upward earnings revision. It
is also likely that the pace of ascend that STI enjoyed over the
past 2 months should soon give way to a more gradual rise
that could see STI heading pass 3600 by year-end.
Results for Hutchison Port Holdings Trust in line; volume
growth of 5% in FY12. FY12 DPU of 6.6UScts meets IPO
guidance, boosted by one-off diversion of cash flows from
capex deferrals. DPU should be sustainable at the 6.0UScts
level in FY13, still implying an attractive yield of c.7.5%. We
expect throughput growth of about 3-4% at the Trust’s ports
in FY13. Operating cash flows could stay flattish in FY13, as
we expect increases in staff costs, interest expenses and
taxation to erode some of the revenue gains. HPHT is
leveraged to cyclical recovery in trade; maintain BUY at revised
TP of US$0.85 (Prev US$ 0.8Cool.
4Q12 results for CapitaRetail China Trust in line, driven by
strong positive rental reversions. The trust is benefitting from
active tenancy remixing. Its low gearing helps to drive
inorganic growth. Maintain Hold, TP raised to S$1.77 (Prev S$
1.62).
Starhill Global REIT is divesting Roppongi Primo Building, a
mixed use property located in Tokyo for JPY 700m (or
S$9.5m). The sale price is equivalent to the latest valuation of
the property and translates to an exit yield of 3.2%. Proceeds
will be substantially used to repay loan in JPY. Post divestment
gearing is expected to remain stable at c30%. The property's
footprint is fairly small and represents 0.4% of SGREIT total
portfolio. We believe that this strategic re-balancing exercise in
Japan is positive for SGREIT as the manager look to re-allocate
its resources more efficiently to its other main exposures of
Singapore, Australia and Malaysia. Impact on our estimates is
expected to be minimal at <0.1%. Maintain BUY, TP: S$0.89.
US Indices Last Close Pts Chg % Chg
Dow Jones  14,009.8 149.2 1.1
S&P  1,513.2 15.1 1.0
NASDAQ  3,179.1 37.0 1.2
Regional Indices
ST Index  3,291.1 8.5 0.3
ST Small Cap  570.2 0.1 0.0
Hang Seng  23,721.8 (7.7) (0.0)
HSCEI  12,215.0 84.4 0.7
HSCCI  4,691.0 (7.9) (0.2)
KLCI  1,627.6 (0.2) (0.0)
SET  1,499.2 25.0 1.7
JCI  4,481.6 27.9 0.6
PCOMP  6,318.6 75.9 1.2
KOSPI  1,957.8 (4.2) (0.2)
TWSE  7,856.0 5.9 0.1
Nikkei  11,191.3 52.7 0.5
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 630
Total Daily Vol (m shrs) 3,657
12m ST Index High 3,291
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
1 Feb
Target Price
($)
Noble Group Buy 1.215 1.50
Capitamall Asia Buy 2.240 2.30
Neptune Orient Lines Buy 1.260 1.45
Keppel Corp Buy 11.580 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
1 Feb
Target Price
($)
Jaya Holdings Buy 0.695 0.85
Tiger Airways Buy 0.760 0.95
Ezra Holdings Buy 1.225 1.58
Tat Hong Holdings Buy 1.570 1.80
China Merchants Buy 0.930 1.20
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Rowsley has signed the sale and purchase agreements to
acquire RSP Architects Planners & Engineers, Singapore’s
leading architecture practice, in an all-share deal for $187m
via the issue of up to 1.25 billion Rowsley shares at 15 cents
a share. It will also acquire the Iskandar-located plot of land
from Malaysia's Vantage Bay in an all-share deal for $358m
by issuing 2.4 billion shares. To reward existing shareholders,
Rowsley said that it will issue a free bonus of two warrants
for every existing share held, once all the necessary
shareholder and regulatory approvals for the deals are
received. Each warrant will have an exercise price of 18 cents
per share.
Metech International is expected to record a profit for the
quarter ended 31 December 2012 as well as for the half year,
despite an unprofitable first quarter, mainly due to a
reorganisation of its core business, acquisition of a profitable
business in China and the disposal of its loss-making
European units.
Dapai International is expected to record a net loss in 4Q12
and FY12, mainly attributable to a slowdown in the sales of
its products during the period.
Advanced Systems Automation is expected to report a net
loss for FY12 mainly due to the decrease in the Group’s
revenue compared to the prior financial year as a result of the
weak market demand for the Group’s Equipment and
Equipment Contract Manufacturing Services businesses
arising from the current poor global economic environment.
The Casino Regulatory Authority of Singapore (CRA) has
renewed the casino licence of Genting Singapore's Resorts
World at Sentosa (RWS) for a further three years. The
renewal comes with additional requirements to strengthen
compliance. CRA has imposed additional requirements on
RWS to put in place more robust structures and processes
aimed at strengthening its overall compliance of our laws and
regulations.
China's services industries expanded at the fastest pace since
August as gains in retailing and construction aid a recovery in
the world's second-biggest economy. The non-manufacturing
Purchasing Managers' Index (PMI) rose to 56.2 in January
from 56.1 in December. The manufacturing PMI released on
Feb 1 showed a fourth month of expansion although the
reading declined to 50.4 from 50.6 in December, while HSBC
said that its final PMI reading stood at 52.3, a two-year high
that outperformed its preliminary figure published last week.
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PostPosted: Tue Feb 05, 2013 9:37 am    Post subject: Reply with quote

Today’s Focus
• United Envirotech - Improved earnings flow; maintain
Buy, TP raised to S$0.74
US and European markets fell as investors locked in recent
gains after political uncertainties in Eurozone resurfaced. The
Spanish Premier faced opposition calls to resign amid reports
about illegal payments. There was also anxiety ahead of the
Italian elections this month. Bond yields rose with Spain’s 10-yr
government yield increasing to 5.44% from 5.2%, which is
still far below the 7% threshold that investors fear.
For Singapore, the focus continues to be on the earnings
season. STI had held above its 15-day EMA since late Nov last
year. This indicator is currently at about 3260, which should
provide near-term support on pullback.
3Q13 results for United Envirotech exceeds our estimates by
>15%, thanks to higher Engineering, Procurement and
Construction (EPC) sales and better Treatment margins.
Growth visibility is backed by rising Treatment income and
>Rmb1bn EPC orders in bidding stage. Post 3Q results, our
analyst has raised FY13/14F earnings by 7%/5% to account for
higher EPC recognition and order wins. Maintain Buy,
TP raised to S$0.74 (Prev S$ 0.67).
For the first time in seven months, Singapore's purchasing
managers' index (PMI) has signalled a marginal expansion of
the manufacturing sector. The overall PMI for January rose to
50.2, just above the 50-point threshold that divides growth
from contraction. It rose 1.6 points from the December
reading of 48.6, thanks to expansion in new domestic and
export orders, the stockholdings of finished goods, as well as
employment. The electronics PMI stayed in contraction
territory for a fourth straight month. Despite rising 3.3 points
from December, the reading of 49.9 is still below the 50-point
threshold.
According to Financial Times, Singapore Exchange is in talks to
buy a stake in LCH Clearnet, Europe’s biggest clearing house,
or to become part of the deal in which the London Stock
Exchange Group is set to take a controlling 60% stake.
US Indices Last Close Pts Chg % Chg
Dow Jones .. 13,880.1 (129.7) (0.9)
S&P .. 1,495.7 (17.5) (1.2)
NASDAQ .. 3,131.2 (47.9) (1.5)
Regional Indices
ST Index .. 3,297.4 6.2 0.2
ST Small Cap .. 570.9 0.7 0.1
Hang Seng .. 23,685.0 (36.Cool (0.2)
HSCEI .. 12,156.6 (58.5) (0.5)
HSCCI .. 4,694.3 3.4 0.1
KLCI .. 1,634.6 7.0 0.4
SET .. 1,506.4 7.1 0.5
JCI .. 4,490.6 8.9 0.2
PCOMP .. 6,436.0 117.4 1.9
KOSPI .. 1,953.2 (4.6) (0.2)
TWSE .. 7,923.2 67.2 0.9
Nikkei .. 11,260.4 69.0 0.6
STI Index Performance
Singapore
Total Market cap (US$bn) 630
Total Daily Vol (m shrs) 3,971
12m ST Index High 3,297
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
4 Feb
Target Price
($)
Noble Group Buy 1.22 1.50
Capitamall Asia Take profit 2.20 2.30
Neptune Orient Lines Buy 1.27 1.45
Keppel Corp Buy 11.57 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
4 Feb
Target Price
($)
Jaya Holdings Buy 0.705 0.85
Tiger Airways Buy 0.760 0.95
Ezra Holdings Buy 1.205 1.58
Tat Hong Holdings Buy 1.585 1.80
China Merchants Buy 0.930 1.20
Midas Holdings Take profit 0.55 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Courts Asia continues to expand in existing markets
Singapore and Malaysia through physical and online stores as
well as a wider array of offerings. Courts is planning to
launch a new store at JEM retail mall in Jurong this year,
which comes on the heels of a new store in Buona Vista last
September. Courts is also aiming to first build up significant
traction in Indonesia, while noted that other markets in the
region such as Vietnam and the Philippines also offer growth
prospects.
Technics Oil and Gas has been awarded two contracts worth
a total of S$6.6m. The contracts are for the supply of
Compressors Packages for Offshore Vietnam and Thailand.
Elektromotive Group proposes to issue to the Subscriber 0%
equity linked redeemable structured convertible notes due
2018 with an aggregate principal amount of up to S$20m.
The Subscriber is a Cayman Islands domiciled open-ended
fund whose investors are mainly based in Asia. The proceeds
will be used to fund the capital expenditure, working capital
and other operational requirements.
China Oriental Group expects to report lower net profit for
FY Dec12 as compared to the previous year, mainly
attributable to significant decrease in the average selling
prices of its products and the substantial loss incurred by a
subsidiary.
Huan Hsin is expected to report a substantial increase in the
net loss for FY Dec12. The sustained economic weaknesses in
the market, especially in Europe and the US, and the
intensified competition in the industry have resulted in the
continued operating losses of some of the subsidiaries of the
Group.
HSR Global is expected to report a net loss for FY12 mainly
due to start-up losses from new business units, softer
property market, increased operating costs and one-off
retrenchment costs.
Hengxin Technology expects to record a materially lower net
profit for 4Q12 compared to 4Q11, primarily attributed to
the continuing weak market demand for its main product, RF
Coaxial Cables and increase in operating expenses.
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PostPosted: Wed Feb 06, 2013 9:46 am    Post subject: Reply with quote

Today’s Focus
 SIA Engineering - Trading close to historic high valuations;
further re-rating unlikely. Downgrade to HOLD
The rebound off STI’s 3260 immediate support looks set after
corporate earnings and a buyout of Dell lifted US markets.
Thus far into the US results season, about 74% out of the 291
S&P 500 companies that have released results have exceeded
profit projections and 66% have beaten sales estimates, this
according to Bloomberg.
In Asia, Nikkei and All-Ords have actually recovered above
Monday’s closing level thus far. At best, STI could see a re-test
of 3300 or even exceed it little at best but heading into the
CNY long weekend, Monday’s high at 3320 will continue to
cap weekly upside.
3QFY13 results for SIA Engineering slightly below; 9MFY13
earnings growth of about 1% is not exciting. Management
expects that business should remain stable in 4Q-FY13 but
macro uncertainties will continue to impact the aviation
industry. Nevertheless, earnings for SIE should remain resilient
and benefit from the expansion in traffic in the high growth
Asia-pacific region. Its secure and attractive dividend
expectations have fuelled strong share price performance. SIE
is trading close to historic high valuations; further re-rating is
unlikely at this point. Downgrade to HOLD; TP revised up to
S$4.80 (Prev S$ 4.40) to account for stronger sentiment and
market yield compression.
Yangzijiang has acquired another 20% stake in Xinfu yard for
US$18m or 0.6% of its market cap, bringing its ownership to
80%. We estimate the additional stake to lift FY13-14F
earnings by 2-3% assuming mid single digit net margin. We
will adjust our forecasts after company's results due on Feb 22
(before market). This is a positive move as Xinfu Yard, located
at Taixing City of Jiangsu province, is ideal for building higher
value-add, large vessels and management has plans for
building very-large crude carrier (VLCC) or large containership
and other larger vessel types in this yard.
1H13 results for Silverlake Axis came in ahead of our
expectations due to higher margins. Recurring revenue grew
33% YoY and accounted for 50% of group revenue in
1HFY13. Our analyst has raised FY13F/14F EPS by 3% each.
US Indices Last Close Pts Chg % Chg
Dow Jones  13,979.3 99.2 0.7
S&P  1,511.3 15.6 1.0
NASDAQ  3,171.6 40.4 1.3
Regional Indices
ST Index  3,272.7 (24.7) (0.7)
ST Small Cap  567.1 (3.Cool (0.7)
Hang Seng  23,148.5 (536.5) (2.3)
HSCEI  11,813.4 (343.2) (2.Cool
HSCCI  4,630.5 (63.Cool (1.4)
KLCI  1,633.4 (1.2) (0.1)
SET  1,505.7 (0.6) (0.0)
JCI  4,479.4 (11.1) (0.2)
PCOMP  6,470.5 34.5 0.5
KOSPI  1,938.2 (15.0) (0.Cool
TWSE  7,886.9 (36.2) (0.5)
Nikkei  11,046.9 (213.4) (1.9)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 631
Total Daily Vol (m shrs) 4,196
12m ST Index High 3,297
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
5 Feb
Target Price
($)
Noble Group Buy 1.205 1.50
Neptune Orient Lines Buy 1.260 1.45
Keppel Corp Buy 11.490 13.00
Capitamall Asia Take profit 2.200 2.30
Stock Picks – Small /Mid Cap
Rec’n Price ($)
5 Feb
Target Price
($)
Jaya Holdings Buy 0.715 0.85
Tiger Airways Buy 0.745 0.95
Ezra Holdings Buy 1.185 1.58
Tat Hong Holdings Buy 1.565 1.80
China Merchants Buy 0.920 1.20
Midas Holdings Take profit 0.535 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
We expect Silverlake Axis to continue to register double-digit
growth. Maintain BUY with higher TP of S$0.58 implying
14% upside potential with ~5% yield.
Sin Heng registered total revenue of $41.4m for 2Q FY13
(+28.9% y-o-y) and $84.4m for 1H FY13 (+32.2% y-o-y). The
increase in total revenue was due to increase in both rental
and trading revenue. Revenue from Equipment Rental
business increased by 49.7% y-o-y to $13.5m for 2Q FY13,
mainly due to expanded fleet size in the Group and the
improvement in rental rates. Revenue from Trading business
increased by 20.7% y-o-y to $27.9m, mainly due to higher
volume of cranes traded as a result of strong demand in the
regional markets. Net profit came in at $3.0m (+19.1% y-o-y)
for 2Q FY13 and $6.3m (+50.8%) for 1H FY13.
Hafary Holdings is placing up to 20m new shares at S$0.294
per share. The Placement Price represents a discount of
approximately 9.9% to the last weighted average price. The
estimated net proceeds of about S$5.8m will be used for
redevelopment of property and for general working capital
purposes.
Sinotel Technologies is expected to record a net loss for
FY12, mainly attributable to thin profit margins arising from
the increase in the subcontractor costs and the costs incurred
in facilitating the initial certification of the completion for the
projects.
United Food Holdings is expected to report a loss for 4Q12
mainly due to increase in soybean raw materials costs and
provision for impairment costs.
Ziwo Holdings is expected to record a significant drop in its
revenue and report an operating loss for FY12 due to (i)
slowdown in sales activities; (ii) lower gross profit; (iii)
provision for doubtful debts; and (iv) writing off of research
and development expenditure.
Growth in China's services sector hit a four-month high in
January. The HSBC services purchasing managers' index (PMI)
rose to 54 last month, up from December's 51.7. The services
sector made up 46% of China's gross domestic product in
2012. Yesterday's PMI, the last of five from China in any
month, is in line with other surveys released last week that
showed a stabilising Chinese economy poised for a modest
recovery.
In property news, a plum, 99-year leasehold private housing
site opposite the Queenstown MRT Station drew just three
bidders, below market expectations of between five and 10
contestants for the plot. The top bid was, however, within
expectations at $562.8m, or $883 psf ppr. This came from a
consortium backed by Hong Leong Holdings and City
Developments. Predictions for the top bid had ranged from
$700 psf ppr to $1,100 psf ppr.
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PostPosted: Thu Feb 07, 2013 9:55 am    Post subject: Reply with quote

Today’s Focus
 Construction related plays to benefit from Government’s
initiative to invest and build housing and public transport
infrastructure well ahead of demand
 ASL Marine - Firmly on track for a strong earnings
recovery; maintain BUY, TP S$0.90
In a major policy shift in planning and development strategy,
the Singapore Government will now invest and build housing
and public transport infrastructure well ahead of demand.
Complaints about overcrowding, congestion and the long wait
for HDB flats prompted the switch, this according to National
Development Minister Khaw Boon Wan.
We had recently highlighted that an anticipated acceleration in
infrastructure spending, the need to ‘build more & build faster’
will underpin construction related stocks. We stick to this view.
Our construction related picks are Tat Hong, Tiong Seng, Sin
Heng and Pan-United. Other construction related plays are UE
E&C, Engro Corp and Lian Beng. One of Tiong Seng’s niche
areas is its pre-casting services and their automated pre-fab
hub, which is positioned to benefit from public housing
building.
2Q13 earnings for ASL Marine in line, +40% y-o-y; gross
margins continue to impress. The slow YTD order wins is not a
concern; we expect back-end loaded wins as yard capacity
frees up. While 1H FY13 forms 40% of our full year forecast,
we keep our numbers intact as we expect a stronger 2H13.
Maintain BUY, TP S$0.90. ASL remains firmly on track to post
a strong 52% earnings recovery in FY13F, supported by its
S$528m shipbuilding orderbook which provides visibility up to
end FY14. Technically, the stock has re-based at $0.73
(support) over the past 3 weeks and looks ready to resume its
steady rising trend for a re-test of the post-GPC high at
$0.795. Based on Fibonacci projection, a rise above this level
should lift the stock to $0.95 in coming month(s).
DPU of 2.09 Scts for Far East Hospitality Trust is 4.5% above
forecasts; NAV uplift to S$0.97. Portfolio renewal is in
progress, with further refurbishment plans to result in uplift in
average daily rates. BUY maintained, TP S$1.13 (Prev S$ 1.09).
We continue to see further upside upon the completion of its
planned purchase of Grand Rendezvous Singapore, which we
have not factored into our numbers. The stock offers a
prospective yield of about 6%.
US Indices Last Close Pts Chg % Chg
Dow Jones  13,986.5 7.2 0.1
S&P  1,512.1 0.8 0.1
NASDAQ  3,168.5 (3.1) (0.1)
Regional Indices
ST Index  3,276.5 3.9 0.1
ST Small Cap  571.4 4.3 0.8
Hang Seng  23,256.9 108.4 0.5
HSCEI  11,849.3 35.9 0.3
HSCCI  4,642.9 12.4 0.3
KLCI  1,614.1 (19.2) (1.2)
SET  1,500.4 (5.4) (0.4)
JCI  4,499.0 19.5 0.4
PCOMP  6,431.4 (39.1) (0.6)
KOSPI  1,941.6 5.4 0.3
TWSE  7,906.7 19.7 0.2
Nikkei  11,463.8 416.8 3.8
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$bn) 627
Total Daily Vol (m shrs) 5,003
12m ST Index High 3,297
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
7 Feb
Target Price
($)
Noble Group Buy 1.200 1.50
Neptune Orient Lines Buy 1.260 1.45
Keppel Corp Buy 11.590 13.00
Capitamall Asia Take profit 2.170 2.30
Stock Picks – Small /Mid Cap
Rec’n Price ($)
7 Feb
Target Price
($)
Jaya Holdings Buy 0.715 0.85
Tiger Airways Buy 0.745 0.95
Ezra Holdings Buy 1.180 1.58
Tat Hong Holdings Buy 1.565 1.80
China Merchants Buy 0.925 1.20
Midas Holdings Take profit 0.540 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Goodpack posted 2QFY13 earnings of US$11.1m (+4% y-oy),
in line with our expectations. We expect a stronger
2HFY13, tapping into recovery in rubber trade volumes. The
Automotive sector will support growth in the medium term.
Maintain HOLD with TP S$1.95.
Cache Logistics Trust has signed an option to acquire a rampup
warehouse for S$55.2m at 15 Gul Way. Initial yield of
8.7% is higher than Cache’s implied yields of c6.5%, which
means that the acquisition will be accretive to earnings. With
this acquisition, Cache will benefit from a larger and more
diversified portfolio of warehouses in Singapore. Cache also
announced that they have obtained the long anticipated
Baa3 rating from Moody’s. Given a visible acquisition pipeline
from its sponsor, the credit rating will provide the trust with
added financial capacity and flexibility to head above the
current 35% limit. Maintain BUY, TP S$1.40. Cache’s
portfolio remains stable, with minimal renewals over next 2
years.
Trek 2000 is presently conducting a risk management review
of its Intellectual Property (IP) assets in view of the rapid
technological changes. Based on an initial assessment, this
exercise is likely to result in a downward revaluation in the
Company's IP assets, which may impact the Company's
financial results, including the likelihood of reporting a loss
for FY12.
Boustead Singapore has been awarded a S$70m contract to
design and build an integrated ramp-up logistics and office
facility to be located at Tampines LogisPark in Singapore. The
latest contract has raised the Group’s order book backlog to
S$422m.
UE E&C has been awarded the tender for S$35.2m
Nominated Sub-Contract for Electrical Installation Works to
the Proposed Residential/Commercial Development for the
Waterway Point and Watertown Project at Punggol
Central/Punggol Walk.
Pteris Global is proposing to acquire Shenzhen CIMC-TianDa
Airport Support for S$112m. CIMC-TianDa Airport Support is
a company incorporated in Shenzhen, PRC and is principally
involved in the design, development, manufacture,
installation and maintenance of passenger boarding bridges,
ground support equipment and baggage handling systems.
Midas announced that its joint venture company, Nanjing SR
Puzhen Rail Transport, has won a RMB710m metro contract.
This contract is expected to contribute positively to the
Group’s financial performance for the 2014 and 2015
financial years.
Viz Branz is withdrawing the proposed 1 for 1 bonus issue
that was announced in May last year.
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PostPosted: Fri Feb 08, 2013 9:49 am    Post subject: Reply with quote

Today’s Focus
• Petra Food - Downgrade to HOLD after strong share price
run, prefer accumulation at lower price levels. TP
unchanged at S$3.97
• StarHub - Mix of growth and yield; maintain BUY with
higher TP of S$4.30
The management of Petra Food is guiding for 4Q12 loss
arising from continued market weakness and exceptional
charges in its Cocoa Ingredients (CI) division. This will not
affect the proposed disposal of CI business to Barry Callebaut
for US$950m. We have trimmed FY12F earnings by c.39% to
factor in these exceptional items, but have kept FY13F/14F
intact. While we remain positive on prospects for its Branded
Consumer division, Petra’s share price has rallied by c.20%
since our upgrade in Dec12. Downgrade to HOLD, and would
prefer accumulation at lower price levels. TP unchanged at
S$3.97.
StarHub’s 4Q12 earnings were 22% ahead of consensus
estimates due to lower than expected handset subsidies.
FY13F/14F earnings were raised by 8%/6% on lower subsidies
and growth in digital voice home services revenue. Maintain
BUY with higher TP of S$4.30 (Prev S$ 4.00). COO Mr. Tan
Tong Hai will be the new CEO by end Feb 2013. Mr. Tan had
successfully turned around Singapore Computer Systems and
Pacific Internet in his previous roles.
3QFY13 net profit of S$142.5m for SIA was in line with
market expectations but below ours. This is a relatively weak
performance for SIA’s traditional peak period as weak yields
persist in its core passenger Business. Outlook remains
challenging as demand for premium travel is likely to stay
tepid. Maintain HOLD and S$11.20 TP (1x P/BV).
3Q13 results for Biosensors 16% below expectations as
Terumo sales disappoints again. We are more optimistic on
Biosensors impending acquisition than 3Q13 results.
Binsensors announced two weeks ago that it raised
S$300m from 4.875% semi-annual fixed rate notes due
2017. Maintain BUY with higher TP of S$1.71 (Prev S$
1.41). There is immediate resistance at S$1.35 to S$1.40.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,944.1 (42.5) (0.3)
S&P �� 1,509.4 (2.7) (0.2)
NASDAQ �� 3,165.1 (3.3) (0.1)
Regional Indices
ST Index �� 3,261.8 (14.Cool (0.5)
ST Small Cap �� 568.2 (3.2) (0.6)
Hang Seng �� 23,177.0 (79.9) (0.3)
HSCEI �� 11,682.0 (167.3) (1.4)
HSCCI �� 4,608.9 (33.9) (0.7)
KLCI �� 1,619.6 5.4 0.3
SET �� 1,499.8 (0.5) (0.0)
JCI �� 4,503.1 4.2 0.1
PCOMP �� 6,460.0 28.6 0.4
KOSPI �� 1,931.8 (4.4) (0.2)
TWSE �� 7,906.7 19.7 0.2
Nikkei �� 11,357.1 (106.7) (0.9)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 629
Total Daily Vol (m shrs) 3,865
12m ST Index High 3,297
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
7 Feb
Target Price
($)
Noble Group Buy 1.185 1.50
Neptune Orient Lines Buy 1.250 1.45
Keppel Corp Buy 11.500 13.00
Capitamall Asia Take profit 2.080 2.30
Stock Picks – Small /Mid Cap
Rec’n Price ($)
7 Feb
Target Price
($)
Jaya Holdings Buy 0.705 0.85
Tiger Airways Buy 0.740 0.95
Ezra Holdings Buy 1.165 1.58
Tat Hong Holdings Buy 1.560 1.80
China Merchants Buy 0.905 1.20
Midas Holdings Take profit 0.545 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
2Q13 results for Jaya is below expectations, drag by
impairment charge; otherwise, it was a good quarter. Jaya
has also declared interim DPS of 0.5 Scts. The resumption
of dividend is earlier than expected. FY13F earnings cut by
19% on impairment charge and expectation of a weaker
3Q; FY14F is intact. Stay invested for the longer term
recovery; maintain BUY, TP S$0.85.
FY12 results for CapitaMall Asia slightly ahead of our
expectations on across-the-board operational
improvement. We expect accelerated earnings growth
momentum as operational assets ramp up. Maintain Buy,
TP S$2.30.
2Q13 results for Amtek broadly in line with ours but
below consensus. Interim DPS of 1.3Scts was declared,
largely in line. Maintain FULLY VALUED and S$0.46 TP.
We see downside to consensus earnings.
Ascott Residence Trust recently completed a private
placement exercise, which boosted its acquisition kitty by an
additional S$150m. We believe that proceeds will be utilised
towards value accretive and yield enhancing acquisitions. We
now factor in S$300m worth of acquisitions (@ 6.0% yield) in
our forecasts, assuming a target post acquisition gearing of
c39%. We estimate that every additional S$50m in
acquisitions will raise gearing by 1 ppt, and DPU estimates
and our TP by c.1%-1.5%. Maintain BUY, TP raised to
S$1.53 (Prev S$ 1.49) after factoring in acquisitions.
SembCorp Marine has secured an LOI for an EPC contract
of the Process, Drilling, and Quarters Platform Topsides
from Det norske oljeselskap ASA, worth about S$900m.
Construction is expected to commence in December
2013, with completion in March 2016. This order is
SMM’s maiden win for FY13, for which we have assumed
order wins of S$5bn for the full year.
No decision has been made on whether Virgin Australia's
proposed acquisition of a 60% stake in Tiger Australia
could proceed. A takeover of Tiger Australia by Virgin
Australia could "mute" competition in the Australian
domestic market and create a duopoly, according to the
Australian Competition and Consumer Commission
(ACCC). Both Tiger Australia and Virgin have responded
to the ACCC's statements, saying that they strongly
believe the deal will help improve and promote
competition, resulting in more low cost flights and
continuing to benefiting consumers.
ASTI Holdings is expected to report a net loss for FY12,
mainly due to impairment losses, decrease in gross profit
margin and losses from its newly acquired subsidiary.
China Sports is expected to report weaker 4Q12 results as
compared to 4Q11.
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PostPosted: Wed Feb 13, 2013 9:36 am    Post subject: Reply with quote

Today’s Focus
• ComfortDelgro - Preferred land transport play with strong
balance sheet. Maintain BUY, TP: S$2.05
US market was flat last night as investors digested another
round of earnings reports and looked ahead to President
Obama's State of the Union address in the evening. The
president is expected to focus on the economy, jobs and
the budget, while also speaking about gun control and
immigration. Despite the flat performance, Dow is now less
than 200pts from its all time high in Oct 07. For the STI, we
see immediate resistance at 3320.
4Q12 results for ComfortDelgro were within expectations,
ending FY12 a record year. Final DPS of 3.5 Scts was
declared, equating to yield of 3.4% for FY12. Capex
requirements are projected to taper off in FY14F, and we
remain hopeful that dividend payout could increase.
Balance sheet remains strong to pursue inorganic growth.
ComfortDelgro is trading at lower valuations compared
with SMRT despite geographical exposure. It also offers
stable growth. Maintain BUY, TP: S$2.05.
Sound Global has won the bid for the Water Supply Facility
Project in Nanshan Sub-District, Quangang District,
Quanzhou City, Fujian Province, PRC. The total investment
is approximately RMB95.02m.
Mermaid Maritime has secured a contract extension with
an existing client, an international upstream oil and gas
company, for accommodation barge support services in
Indonesia. The duration of this contract extension is around
5 months and has a potential value of USD 4.7m.
Kitchen Culture is expected to record a net loss for FY12
mainly attributable to losses arising from its newly started
joint venture entity in Hong Kong and losses from its
wholly-owned subsidiary in Malaysia due to a decrease in
retail revenue as a result of the general slowdown and
uncertainties in the global economy, coupled with higher
selling and distribution expenses.
Hanwell Holdings is expected to report a loss for FY12
mainly due to allowance for stock obsolescence and
doubtful debts, and impairment losses.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,018.7 47.5 0.3
S&P �� 1,519.4 2.4 0.2
NASDAQ �� 3,186.5 (5.5) (0.2)
Regional Indices
ST Index �� 3,270.3 8.5 0.3
ST Small Cap �� 570.7 2.5 0.4
Hang Seng �� 23,215.2 38.2 0.2
HSCEI �� 11,649.8 (32.2) (0.3)
HSCCI �� 4,615.0 6.0 0.1
KLCI �� 1,623.8 4.2 0.3
SET �� 1,489.0 (0.2) (0.0)
JCI �� 4,548.2 45.0 1.0
PCOMP �� 6,459.9 1.9 0.0
KOSPI �� 1,954.2 8.4 0.4
TWSE �� 7,906.7 19.7 0.2
Nikkei �� 11,369.1 216.0 1.9
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 628
Total Daily Vol (m shrs) 3,848
12m ST Index High 3,297
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
8 Feb
Target Price
($)
Noble Group Buy 1.190 1.50
Neptune Orient Lines Buy 1.250 1.45
Keppel Corp Buy 11.530 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
8 Feb
Target Price
($)
Jaya Holdings Buy 0.695 0.85
Tiger Airways Buy 0.735 0.95
Ezra Holdings Buy 1.180 1.58
Tat Hong Holdings Buy 1.565 1.80
China Merchants Buy 0.895 1.20
Midas Holdings Take profit 0.550 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Sinostar PEC Holdings is expected to report a significant
loss for FY12. The estimated loss is mainly due to an
increase in the cost of raw materials and the uncorrelated
decrease in the sale price of its products.
Weiye Holdings is expected to report a considerably lower
net profit for FY12 mainly due to the decrease in the
Group’s revenue compared to the prior financial year as a
result of the weak market demand for the Group’s
property business arising from the series of market
cooling measures implemented by the PRC government.
Resale volumes for private residential homes jumped
16.7% m-o-m to hit 920 transactions in January, as
buyers rushed to complete transactions before the new
property cooling measures kicked in. The number was
almost three times the 309 resale transactions seen in
January last year. Driven by bargain hunters, suburban
home sales in the outside central region (OCR) saw the
greatest increase in resale volume, rising 30% to 501
units; transactions of homes in the city fringe (rest of
central region or RCR) increased by 17% to 229.
Conversely, resale volumes for homes in the core central
region (CCR) declined 9% to 190 units in January.
Three industrial sites drew bids on the top end of
expectations, reflecting continued strong demand, even
as the speculative element has been sieved out. The first
site, a 3.96-hectare plot with a 30-year tenure and
maximum gross plot ratio (GPR) of 1.4, drew a top bid of
$61m, or $102.18 psf ppr from Soon Hock Group. When
the site was launched in December last year, the market
was expecting a top bid of $50-$95 psf ppr. The second
site, a 0.3-ha parcel in Tuas South Street 8 (Plot 10), drew
a total of 13 bids, with top bid of $2.4m ($73.45 psf ppr).
The last site, a 0.35-ha plot at Ubi Avenue 4 with a 30-
year lease and GPR of 2.5 drew 10 bids, with top bid of
$16.2m ($172.00 psf ppr).
China’s imports and exports surged last month while
inflation dipped. Exports grew 25% in January after rising
14.1% the previous month. Imports jumped 28.8%
against 6% in December. The trade surplus rose 7.7% yo-
y to US$29.2bn for the month.
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PostPosted: Thu Feb 14, 2013 10:02 am    Post subject: Reply with quote

Today’s Focus
• SingTel – 3Q13 results below expectations; FY13F
earnings growth could enter into negative territory
US equity indices ended mixed yesterday, reacting little to
Barrack Obama’s State of the Union address. For
Singapore, currently trades at just a tat above 14.13x
(average) FY13F PE. In the absence of a firm upward
revision in forward earnings, we continue to see the
likelihood for the STI to switch to a much more gradual net
increase going forward (compared to the 355pt rally in the
past 3 months). Interest should turn more selective and not
broad based. Singapore infrastructure building theme
should continue to be of interest. Besides the current
reporting season, the Singapore 2013 budget will be
announced in about 2 weeks time.
SingTel’s underlying profit of S$874m (-2% y-o-y, -1% qo-
q) released this morning was 3% below our estimate of
S$900m, due to weaker Telkomsel & Globe. Bharti was
weak along the expected lines. Singapore and Australia are
inline although both markets face long term challenges,
including loss of market share in corporate data and startup
losses in Singapore, aggressive Telstra and expensive 4G
spectrum auction in Australia. FY13F earnings growth
could enter into negative territory now with 4.7% yield as
the only attraction. Will follow-up with more updates.
Malaysia’s Jan13 palm oil stock dipped on seasonally lower
output and strong exports. We expect seasonally lower
yields to reduce Feb13 palm oil output to 1.297m MT.
Palm oil inventory is expected to remain above 2m MT for
the rest of the year. Accumulate Bumitama Agri (BUY, TP:
S$1.25) and First Resources (HOLD, TP: S$2.1Cool on
weakness.
Cordlife reported an 18.4% y-o-y increase in revenue to
S$17.0m in HY2013. The increase in revenue was mainly
due to an increase in the number of client deliveries, from
approximately 3,800 in HY2012 to 4,500 in HY2013. The
increase in client deliveries was due to increased awareness
as a result of an increase in marketing and promotional
activities undertaken by the Group. Gross profit margin
remained stable at approximately 70%. Net profit for
HY2013 surged >100% to S$8.4m, boosted by gain on
disposal of associate.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,982.9 (35.Cool (0.3)
S&P �� 1,520.3 0.9 0.1
NASDAQ �� 3,196.9 10.4 0.3
Regional Indices
ST Index �� 3,301.0 30.7 0.9
ST Small Cap �� 575.3 4.6 0.8
Hang Seng �� 23,215.2 38.2 0.2
HSCEI �� 11,649.8 (32.2) (0.3)
HSCCI �� 4,615.0 6.0 0.1
KLCI �� 1,631.2 7.4 0.5
SET �� 1,514.1 25.2 1.7
JCI �� 4,571.6 23.3 0.5
PCOMP �� 6,528.0 68.1 1.1
KOSPI �� 1,976.1 30.3 1.6
TWSE �� 7,906.7 19.7 0.2
Nikkei �� 11,251.4 (117.7) (1.0)
STI Index Performance
Singapore
Total Market cap (US$bn) 628
Total Daily Vol (m shrs) 8,542
12m ST Index High 3,301
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
13 Feb
Target Price
($)
Noble Group Buy 1.205 1.50
Neptune Orient Lines Buy 1.270 1.45
Keppel Corp Buy 11.610 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
13 Feb
Target Price
($)
Jaya Holdings Buy 0.690 0.85
Tiger Airways Buy 0.735 0.95
Ezra Holdings Buy 1.170 1.58
Tat Hong Holdings Buy 1.595 1.80
China Merchants Buy 0.920 1.20
Midas Holdings Take profit 0.555 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Civmec reported a 34.7% y-o-y rise in 2Q FY2013
revenue to S$100.1m, due to higher activities in the Oil &
Gas and Mining and Other segments. On a six monthly
basis, revenue increased by 102.8% y-o-y to S$239.4m.
Gross profit margin was lower, decreasing from 19.5% to
18.9% in 2Q FY2013 due to the different nature of the
jobs undertaken, which have higher average value and
longer terms but with lower gross profit margins.
Correspondingly, gross margins decreased from 22.1%
during the first six months of FY2012 to 15.6% during
the first six months of FY2013. Net profit rose by 40.6%
y-o-y to S$9.6m in 2Q. On a six-monthly basis, net profit
amounted to S$18.3m, representing an increase of
52.3% y-o-y.
Stratech Systems proposes to issue S$506,000 in
aggregate principal amount of redeemable 10.0%
convertible bonds. The Bonds, maturing 12 months after
the date of issue, will not be listed on the SGX. The
conversion price will be at S$0.023 per conversion share.
Memtech International expects to report a loss for FY
Dec12 mainly to: (i) The significantly lower demand for
mobile phone keypads; and (ii) The impairment charge on
fixed assets pertaining to the touch screen operation.
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PostPosted: Fri Feb 15, 2013 9:36 am    Post subject: Reply with quote

Today’s Focus
• Tat Hong - 3Q13 results in line, outlook remains robust.
Maintain BUY with TP unchanged at S$1.80
3Q13 results for Tat Hong in line, lower than expected
operating costs made up for lower crane rental revenue.
The lower crane rental revenue is not a trend. We believe it
was likely that shorter term contracts with higher rates
were completed and booked in 2Q13, leaving longer term
contracts with lower rates running in 3Q13. Otherwise, we
believe crane demand spot rates remain robust going into
4Q13 and we therefore expect pick up in utilisation going
forward. We maintain the view that demand for
construction activity in the region continues to remain
buoyant, which supports our 38% growth in FY14F
earnings. Maintain BUY with TP unchanged at S$1.80.
OCBC reported 4Q12 net profit of S$663m, +12% y-o-y,
better than expected, thanks mainly to strength in its lifeassurance
and wealth-management businesses. For FY12,
net profit rose to S$3.99 bn. 4Q12 net interest income
eased 0.4% to S$921m but non-interest income climbed
by 32% to S$757m, helped by a quadrupling of profit
from life assurance to S$210m, and an 18% y-o-y rise in
fee income to S$304m, thanks to wealth-management
income and loan-related fees. Will provide more updates
post briefing today.
Underlying profit for SingTel was 3% below our estimates
due to lower contribution from Telkomsel and Globe.
Bharti was weak along the expected lines. We are
concerned about high price tag of 4G spectrum in
Australia. Startup losses in the digital media space and
potential market share loss in the corporate data segment
are key challenges in Singapore. Maintain HOLD with
revised TP of S$3.40 (Prev S$ 3.25) to take into account
higher market price of Bharti. SingTel’s potential entry into
Myanmar could be the catalyst, although it is likely to be
EPS dilutive initially due to huge network investments.
Results for Perennial China Retail Trust in line. Looking
ahead, operations ramping up and new development
assets are expected to extend earnings and RNAV growth
visibility. Maintain BUY, TP $0.84. We continue to like
PCRT for its attractive valuations, at 6% yield and 0.9xP/bk
NAV.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,973.4 (9.5) (0.1)
S&P �� 1,521.4 1.1 0.1
NASDAQ �� 3,198.7 1.8 0.1
Regional Indices
ST Index �� 3,290.5 (10.6) (0.3)
ST Small Cap �� 575.0 (0.2) (0.0)
Hang Seng �� 23,413.3 198.1 0.9
HSCEI �� 11,821.4 171.7 1.5
HSCCI �� 4,638.2 23.2 0.5
KLCI �� 1,630.9 (0.3) (0.0)
SET �� 1,526.7 12.6 0.8
JCI �� 4,588.7 17.1 0.4
PCOMP �� 6,513.4 (14.6) (0.2)
KOSPI �� 1,979.6 3.5 0.2
TWSE �� 7,906.7 19.7 0.2
Nikkei �� 11,307.3 55.9 0.5
STI Index Performance
Singapore
Total Market cap (US$bn) 633
Total Daily Vol (m shrs) 10,94
12m ST Index High 3,301
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
14 Feb
Target Price
($)
Noble Group Buy 1.205 1.50
Neptune Orient Lines Buy 1.265 1.45
Keppel Corp Buy 11.650 13.00
Capitamall Asia Take profit 2.130 2.30
Stock Picks – Small /Mid Cap
Rec’n Price ($)
14 Feb
Target Price
($)
Jaya Holdings Buy 0.690 0.85
Tiger Airways Buy 0.730 0.95
Ezra Holdings Buy 1.160 1.58
Tat Hong Holdings Buy 1.570 1.80
China Merchants Buy 0.900 1.20
Midas Holdings Take profit 0.550 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
AusGroup booked a revenue increase of approximately
12% to AU$306.8m for 1HFY2013 on the back of
increased activity levels within the Company’s Major
Projects and Fabrication divisions resulting in 1HFY2013
earnings increasing by 9.8% to AU$9.1m for the period.
Order book as at 14 February 2014 totalled AU$308m.
Despite the softening of commodity markets, the longer
term outlook for the Australian resources sector in
Western Australian, Northern Territory and Queensland -
in oil and gas, LNG, coal seam methane and iron ore mine
development - continues to be positive. The Group is
confident of seeing sustained demand for its services,
particularly in the LNG sector, over the next few years due
to the range of services that the Group can offer these
markets as a multidisciplinary contractor.
STX OSV secured an 800 million kroner (US$145m)
contract to build an offshore vessel for Norwegian firm
Farstad Shipping ASA. Under the deal, STX OSV will build
a 143-meter offshore subsea construction vessel and
deliver it to Farstad in the first quarter of 2015. STX OSV
has also secured another new contract for the design and
construction of one Offshore Subsea Construction Vessel
(OSCV) for DOF Subsea. Delivery is scheduled in 1Q 2015.
Keppel Land's China unit has partnered its property fund
management arm to acquire a retail mall in Shanghai, in
line with its strategy to grow its commercial portfolio in
high-growth cities. Through the joint venture with Alpha,
Keppel Land China bought a 42.5 per cent stake in a
special-purpose vehicle called Equity Rainbow II for
US$126.5m (S$157m). Funds managed by Alpha
purchased the remaining 57.5% stake for US$171.1m.
The property to be acquired is Lifehub@Jinqiao, a mixeduse
office and retail development in the affluent Jinqiao
neighbourhood in Shanghai's Pudong district. Lifehub,
which is currently more than 99% leased after opening in
2009, comprises 98,630 sqm of retail space and 16,102
sqm of offices.
US markets stayed mixed as a buy-out of food company
Heinz by Warren Buffet’s Berkshire Hathaway
overshadowed data that showed the Eurozone 4Q GDP
sank 2.4% (q-o-q, saar), which was worse than the 1.6%
figure expected and also the worst decline in 5 quarters.
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PostPosted: Mon Feb 18, 2013 10:02 am    Post subject: Reply with quote

Today’s Focus
• Plantation Companies - First Resources raised to BUY; YTD
selldown overdone. Bumitama Agri cut to HOLD
With STI currently trading at 14.1x (average) FY13F PE and the
current reporting season yet able to produce a meaningful
upward revision in forward earnings forecast, we see increased
likelihood that the STI has met near-term resistance at 3313. A
consolidation in coming weeks is possible that can result in a
test of the 65-day EMA at c.3200 before STI resumes its climb.
Despite the likelihood of a short-term consolidation, STI’s longterm
rising trend remains intact that can lift it to 3600 by yearend.
Planters may underperform regional indices this year; with
CPO prices expected to remain subdued. Our analyst has cut
CY13F-14F CPO prices by 10-11%. We no longer see
significant rebound in CPO prices this year, given huge
inventory carryover from last year. Soybean oil price premium
hence may not narrow as fast as we previously expected.
4QCY12 earnings are expected to drop 1-34%; except for
Bumitama Agri and Wilmar. Switch to First Resources (raised to
BUY from hold, TP: S$2.16) for exposure. We believe YTD
selldown has been overdone; and expect near term arbitrage
opportunity. Bumitama Agri is cut to HOLD, target price
reduced to S$1.20 from S$1.25. Though Bumitama is still the
best of the bunch, share price has performed well. Wait for
better entry point.
Singapore's non-oil domestic exports rose in January, but at a
slower pace than expected, as non-electronic exports managed
a slim recovery while electronic shipments continued their
slide. NODX rose 0.5% y-o-y in January, below market forecast
of 2.6% growth, and after falling 16.3% in December.
Compared with the previous month, exports fell 1.8% in
seasonally adjusted terms, vs market projection of 8.5%
month-on-month expansion, and after contracting 4.2% m-om
in December. Electronic exports continued to decline, but at
a slower pace than in the previous two months. In January,
electronic shipments fell 5.6% y-o-y, after plunging 19.1% in
December. Non-electronic shipments grew 3.8%, compared
with a 14.8% fall last month, buoyed by a 28.2% rise in
petrochemicals. Pharmaceutical exports fell 22.9%, after
sliding 11.5% in the previous month.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,981.8 8.4 0.1
S&P �� 1,519.8 (1.6) (0.1)
NASDAQ �� 3,192.0 (6.6) (0.2)
Regional Indices
ST Index �� 3,283.1 (7.4) (0.2)
ST Small Cap �� 578.4 3.3 0.6
Hang Seng �� 23,444.6 31.3 0.1
HSCEI �� 11,845.2 23.8 0.2
HSCCI �� 4,681.2 43.1 0.9
KLCI �� 1,627.9 (3.0) (0.2)
SET �� 1,521.5 (5.2) (0.3)
JCI �� 4,609.8 21.1 0.5
PCOMP �� 6,521.6 8.2 0.1
KOSPI �� 1,981.2 1.6 0.1
TWSE �� 7,906.7 19.7 0.2
Nikkei �� 11,173.8 (133.5) (1.2)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 633
Total Daily Vol (m shrs) 7,208
12m ST Index High 3,301
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
15 Feb
Target Price
($)
Noble Group Buy 1.190 1.50
Neptune Orient Lines Buy 1.260 1.45
Keppel Corp Buy 11.720 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
15 Feb
Target Price
($)
Jaya Holdings Buy 0.700 0.85
Tiger Airways Buy 0.735 0.95
Ezra Holdings Buy 1.175 1.58
Tat Hong Holdings Buy 1.545 1.80
China Merchants Buy 0.905 1.20
Midas Holdings Take profit 0.545 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Shipments to the European Union, its biggest export
destination, fell 18.4% y-o-y in January, compared with a
7.3% y-o-y fall in the previous month. Exports to the U.S. fell
14.1% y-o-y after falling 27.7% in December. Exports to
China, however, grew 18.0% after decreasing 1.2% in the
previous month.
January total primary private home sales was up 0.4% m-om,
however, excl ECs, take up surged 43% m-o-m to 2013
units, the highest transactions in 4 months and 6% higher
than the average monthly average seen last year. The strong
demand was recorded largely in the first half of the month
(prior to govt cooling measures) and extensive price rebates
from developers after the cooling measures. We expect a
quieter February, and maintain projection for a 5% drop in
prices this year. Top picks are CapitaMalls Asia and
Capitaland. We prefer developers with the ability to unlock
asset value.
The government will announce the FY13 budget on 25 Feb
(next Monday). This budget will focus more on longer-term
challenges than short-term risks to the economy. Specifically,
to sustain longer-term growth given an aging population and
the moderation in labour growth, productivity improvement
and fostering inclusive growth will continue to take centrestage
in this budget. Concrete medium-term measures to
improve public infrastructure will also be introduced to ease
some of the current bottlenecks. We expect many measures
to help companies offset the transition costs from the
ongoing restructuring and to boost productivity. For
households, an outright cash handout or a generous special
transfer package will be visibly lacking in this budget.
ST Engineering reported FY12 net profit of S$576m (+9% yo-
y) in line, and final dividend of 13.8Scts (FY12: 12.5Scts).
We see upside to end-FY12 orderbook of S$12.1bn from
recent Singapore navy contract. MRO revenues recovering;
potential for upside surprise from pick up in US operations
Valuations have not peaked; maintain BUY with higher TP of
S$4.40 (Prev S$ 3.80).
Indofood is subscribing for 98m new shares, representing
14.95% stake in China Minzhong at S$0.915 per share. The
business synergies between the two listed food companies
open the door to potential regional collaborations in future.
Net proceeds of approximately S$85m will be used for
building new industrial farming capacities and working
capital purposes.
SIA’s systemwide passenger carriage grew 3.4% against a
1.7% increase in capacity. As a result, passenger load factor
(PLF) improved by 1.3 percentage points to 78.3%. The
number of passengers carried increased by 2.5% to 1.5
million. Sytemwide PLF improved across all regions with the
exception of South West Pacific where growth in demand
was outstripped by the increase in capacity. Passenger yields
are likely to continue to come under pressure due to
promotional fare activities. Overall cargo traffic grew 3.0% yo-
y, while capacity decreased by 0.8%, resulting in a 2.2
percentage-point increase in overall cargo load factor.
December's retail sales for Singapore fell 1.5% y-o-y, below
consensus forecast of a 0.2% growth. It was dragged down
by weaker sales of motor vehicles, which, if removed from
the equation, leaves retail sales dipping 0.4% y-o-y. On a
month-on-month basis, December retail sales slipped 0.9%,
also below the consensus of a 0.6% growth. If vehicle sales
are excluded, retail sales declined 0.8% m-o-m. Motor
vehicle sales in December fell 1.1% m-o-m. Compared to
December 2011, motor sales fell 6.1%. Retail sales of
telecommunications apparatus and computers fell the most
year-on-year - 12.1%. Sales of recreational goods, petrol
service stations, apparel/footwear and optical goods/books
fell by between 1.5% and 2.4%.
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PostPosted: Tue Feb 19, 2013 9:46 am    Post subject: Reply with quote

Today’s Focus
• Tiger Airways - January operating statistics validate our
view on an upcoming turnaround. Maintain BUY with
S$0.95 TP.
Tiger Airways reported a good start to CY-2013, with its
January operating statistics continuing the momentum from
recent months, and validating our view on an upcoming
turnaround. Overall, passenger carriage grew by 34% y-o-y to
1,013m p-km with a 9ppt improvement in load factor to 84%.
Tiger Singapore registered a 23% y-o-y growth in passenger
carriage in January 2013, to 722m p-km, with a 10ppt
improvement in load factor to 84%. The January data point
can help lift confidence in the stock because the company had
earlier flagged a tough CY1Q in anticipation of the seasonal
slowdown. We believe Singapore operations are now well on
track to remain solidly profitable at the operating level in 1QFY13.
Tiger Australia meanwhile registered a 108% y-o-y
increase in passenger carriage to 281m p-km, with a very high
load factor at 87%, compared to 84% a year ago. Even more
impressive is the m-o-m growth of 9% in traffic in January,
given that December is traditionally the peak traffic month,
and there was some disruption in air traffic in late January
from Cyclone Oswald.
Based on the operating statistics, we believe both cubs remain
on a solid footing for earnings improvements in coming
quarters and Tiger Airways remains on course to return to full
profitability in this calendar year. Clearance from the
Australian competition watchdog for the Virgin-Tiger Australia
deal to proceed could be a key positive catalyst in the near
term. Maintain BUY with S$0.95 TP. Technically, the news
should pin support at $0.73.
Ezion has secured a new jackup charter contract worth
US$79.9m for a firm initial three-year term. It also has
additional two-year extendable option. The contract value
translates to a day rate of approx US$73k/day; with total
project capex of US$70m and 30/70 equity-debt funding ratio,
we estimate annualised earnings contributions of US$7m/year,
translating to a project ROE of 33%. This is Ezion’s 12th
jackup project and its second contract win for FY13; total YTD
contract wins currently stands at US$197m. Looking ahead,
management continues to see a robust 2013 project pipeline,
equal, if not stronger, than 2012’s. We keep our numbers
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,981.8 8.4 0.1
S&P �� 1,519.8 (1.6) (0.1)
NASDAQ �� 3,192.0 (6.6) (0.2)
Regional Indices
ST Index �� 3,288.1 5.1 0.2
ST Small Cap �� 579.5 1.1 0.2
Hang Seng �� 23,381.9 (62.6) (0.3)
HSCEI �� 11,735.2 (110.0) (0.9)
HSCCI �� 4,667.9 (13.3) (0.3)
KLCI �� 1,620.9 (7.0) (0.4)
SET �� 1,523.3 1.8 0.1
JCI �� 4,612.0 2.3 0.0
PCOMP �� 6,565.2 43.6 0.7
KOSPI �� 1,981.9 0.7 0.0
TWSE �� 7,943.5 36.9 0.5
Nikkei �� 11,407.9 234.0 2.1
STI Index Performance
Singapore
Total Market cap (US$bn) 633
Total Daily Vol (m shrs) 4,753
12m ST Index High 3,301
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
18 Feb
Target Price
($)
Noble Group Buy 1.190 1.50
Neptune Orient Lines Buy 1.260 1.45
Keppel Corp Buy 11.72 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
18 Feb
Target Price
($)
Jaya Holdings Buy 0.700 0.85
Tiger Airways Buy 0.735 0.95
Ezra Holdings Buy 1.175 1.58
Tat Hong Holdings Buy 1.545 1.80
China Merchants Buy 0.905 1.20
Midas Holdings Take profit 0.545 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
intact for now pending the release of its FY12 results this
Thursday morning. BUY call is maintained on the back of its
strong projected earnings growth, solid execution and robust
pipeline.
Construction group Lian Beng has bagged a S$117m
condominium development project. The construction of Skies
Miltonia will start in March this year and is expected to be
completed in 33 months. The development, located at the
junction of Yishun Ave 1 and Miltonia Close, will have eight
13-storey residential blocks with penthouses and one threestorey
residential block, totalling 420 units. Lian Beng's order
book stands at S$664m to date.
Silverlake Axis has secured a contract from the Union Bank of
Colombo to implement Silverlake Axis Integrated Banking
System (SIBS) Core Banking Solution. Union Bank is the
group’s second banking customer in Sri Lanka, after People’s
Bank. The contract is expected to contribute positively to the
results of Silverlake Axis in the current and following financial
year.
According to a news report, CapitaLand is planning to team
up with Iskandar Waterfront Holdings Sdn Bhd (IWH) to
develop a project in the Danga Bay area whose estimated
gross development value is RM4 bn (S$1.6 bn) to RM5 bn.
Oakwell Engineering expects to report a net loss for FY12
due mainly to the Shipbuilding segment, as a result of delays
in the delivery of its on-going projects.
The Monetary Authority of Singapore and international banks
have discussed shelving the U.S. dollar Singapore interbank
offered rate, or Sibor, according to newswire. That rate is one
of several industry-set rates that the central bank is reviewing
due to questions about whether it is susceptible to
manipulation, following the problems with the London
interbank offered rate. The U.S. dollar Sibor is used to price
some loans, but it has a narrower reach than the Singapore
dollar-based Sibor, which is used to price a broader universe
of mortgages and commercial loans in Singapore.
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PostPosted: Wed Feb 20, 2013 11:15 am    Post subject: Reply with quote

Today’s Focus
• CapitaLand - Venturing into Malaysia; medium to long
term positive. Maintain BUY with TP of S$4.09.
US equity indices edged above the narrow sideways band that
stretched over the past 2 weeks on M&A news and after
Germany’s February investor confidence rose more than
expected, fuelling optimism that the country’s economy is on
the rebound. Asia equities are currently on the rise this
morning and the same should go for the Singapore market.
Valuation though, should limit the pace in which STI can rise
as the index currently trades at 14.13x (Ave) 12-mth forward
PE. Tracking along this forward PE line, STI should head to
c.3360 by end-March, which is more than a month away,
based on current earnings forecast.
CapitaLand has entered into an agreement with Iskandar
Waterfront Sdn Bhd and Temasek to acquire and develop land
at the A2 Island in Danga Bay, located in one of the 5 flagship
zones in Johor’s Iskandar Malaysia. Capitaland will take a 51%
stake in the project, Iskandar Waterfront 40% and Temasek
the remaining 9%. This is Capitaland’s first direct large scale
township investment and development in Malaysia. This
signals its confidence in Iskandar Malaysia as a compelling
investment opportunity into a new upcoming development
region, and would generate benefits in the medium term.
Maintain BUY with TP of S$4.09.
More collaboration works between Singapore and Malaysia
are in the making. A new high-speed rail link between Kuala
Lumpur and Singapore is in the works, with passengers
needing just 90 minutes to get from one city to the other once
the system is up and running by 2020.
Suntec REIT is issuing S$280m in aggregate principal amount
of Convertible Bonds (CBs). The convertible bonds will pay a
coupon of 1.4% (semi-annually) and conversion price at
S$2.154. The maturity date is on or about 18 March 2018.
Bondholders can choose to convert to new Suntec REIT units
from 28th Apr'13 onwards. In aggregate, the CBs represent a
potential additional of c130m new units of Suntec REIT shares,
representing a 5.8% of the current share base. Bondholders
may also require the issuer (Suntec REIT) to redeem all/some of
the units together with any accrued interest on 18th March
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,035.7 53.9 0.4
S&P �� 1,530.9 11.2 0.7
NASDAQ �� 3,213.6 21.6 0.7
Regional Indices
ST Index �� 3,295.8 7.6 0.2
ST Small Cap �� 581.3 1.8 0.3
Hang Seng �� 23,143.9 (238.0) (1.0)
HSCEI �� 11,525.7 (209.5) (1.Cool
HSCCI �� 4,586.9 (81.1) (1.7)
KLCI �� 1,615.1 (5.9) (0.4)
SET �� 1,532.1 8.8 0.6
JCI �� 4,602.1 (10.0) (0.2)
PCOMP �� 6,620.7 55.5 0.8
KOSPI �� 1,985.8 3.9 0.2
TWSE �� 7,960.9 17.4 0.2
Nikkei �� 11,372.3 (35.5) (0.3)
STI Index Performance
Singapore
Total Market cap (US$bn) 634
Total Daily Vol (m shrs) 5,219
12m ST Index High 3,301
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
19 Feb
Target Price
($)
Noble Group Buy 1.185 1.50
Neptune Orient Lines Buy 1.250 1.45
Keppel Corp Buy 11.65 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
19 Feb
Target Price
($)
Tiger Airways Buy 0.750 0.95
Ezra Holdings Buy 1.160 1.58
Tat Hong Holdings Buy 1.550 1.80
China Merchants Buy 0.900 1.20
Midas Holdings Take profit 0.565 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
2016 or may be redeemed at the option of Suntec REIT from
that date onwards. Use of the proceeds from this issue is
expected to refinancing debt and will extend its debt maturity
profile as a result. We reckon most likely the proceeds will be
utilized towards refinancing existing CBs due in Dec'13,
which has a coupon of 3.25% and a conversion price of
S$1.678, which is already in the money. The refinancing of
this expiring CB is likely to result in annual savings of c S$5m
(or 2.3% of distributable income). Maintain HOLD call and
TP of S$1.70.
Koh Brothers, a construction, property development and
specialist engineering solutions provider, reported FY12 net
profit of S$19.7m (-4% y-o-y), on the back of S$299.5m in
revenue. The lower net profit was mainly due to higher
distribution and marketing expenses. Gross profit margin for
FY12 rose 3.7 percentage points to 16.7%, from 13.0% for
FY11. Gross profit for FY12 rose 13% to S$50.1m, as the
Group’s continual efforts to drive productivity contributed to
higher margins at its Construction and Building Materials
division.
Yamada Green Resources is placing out 82.2m new shares,
representing approximately 16.49% of the enlarged share
capital, at an issue price of S$0.119 per share, a discount of
about 10% to the last volume weighted average price. The
Subscriber is a special purpose vehicle wholly owned by Mr
Sam Goi Seng Hui, the Executive Chairman of Tee Yih Jia
Group. The net proceeds of about S$9.4m will be used to
fund the future acquisition and expansion of the company, as
well as general working capital.
More companies are issuing profit warning as the close of the
reporting season draws nearer. China Environmental
Resources Group expects to record significant losses for the
six months ended 31 Dec 12 as compared to the profit
recorded for the corresponding period in 2011, mainly
attributed to the loss from changes in fair value of biological
assets of which slight decrease in volume mainly affected by
the shortage of underground water in the Xinjiang Region,
the PRC.
R H Energy expects to report a net loss for FY12 due mainly
to lower revenue from the absence of large equipment
integration projects completed and delivered, higher staff
related expenses and increased business development
expenses in exploring new markets and sourcing new
products.
Changtian Plastic & Chemical is expected to report a loss for
4Q12 mainly due to an impairment charge.
Zhongmin Baihui Retail Group expects to report a lower net
profit in FY12 as compared to FY11. This was mainly
attributable to losses incurred at its Nanzhan Store as it had
only opened for operations in Sep 12.
Changjiang Fertilizer Holdings expects to report significantly
lower revenue and a loss in 4Q12 results due to lower
demand for its products.
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PostPosted: Thu Feb 21, 2013 9:58 am    Post subject: Reply with quote

Today’s Focus
• OKP Holdings - Order book and revenue outlook positive
but labour costs remain challenging. Maintain Hold, TP
S$0.49.
US stocks fell on profit taking on concerns about an earlierthan-
expected withdrawal of government stimulus after the
FED minutes showed policy makers were divided about the
strategy behind the current bond purchase program until there
s a ‘substantial’ improvement in the US labour market. Several
policy makers said the central bank should be ready to vary the
pace of their $85 billion monthly bond purchases. This,
coupled with news of the Chinese government re-tightening
its property stance, should result in a pullback for the STI for
the current session.
Chinese government has tightened its property policy stance
again and earlier than expected. Measures include 1st and 2nd
tier cities setting price control target and local governments
being responsible for their targets; and implementing
household purchase restriction policy strictly and extending
these policies when necessary. While these policies are not
new, the policy tone has turned tight again after a year of
loosening stance. Chinese property stocks such as Yanlord and
Ying Li could be impacted by the news.
An upward revision is on the cards for the 4Q12 GDP figures
for Singapore due tomorrow morning. The economy is
expected to expand 2.5% QoQ saar (1.3% YoY) in the
quarter. This is an upward revision from the advance estimate
of 1.8% QoQ saar (1.1% YoY). It also marks a turnaround in
the growth trajectory from the 6% decline in the previous
quarter. Overall, this will bring full year GDP growth to 1.3%.
This is the slowest full year growth since 2009 as well as the
weakest across East Asia in 2012. The main drag came from
the manufacturing sector although the other sectors
performed poorly as well.
4Q12 and FY12 earnings for OKP Holdings slightly below as
operating costs were higher than expected due to tight labour
supply. Order book and revenue outlook remains positive,
however tight labour supply will continue to challenge
margins. FY12 DPS of 1.5 Scts was declared, below our 2.0
Scts expectations, represents 2.8% yield. Maintain Hold, TP
unchanged at S$0.49.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,927.5 (108.1) (0.Cool
S&P �� 1,512.0 (19.0) (1.2)
NASDAQ �� 3,164.4 (49.2) (1.5)
Regional Indices
ST Index �� 3,308.9 13.1 0.4
ST Small Cap �� 582.6 1.3 0.2
Hang Seng �� 23,307.4 163.5 0.7
HSCEI �� 11,683.0 157.3 1.4
HSCCI �� 4,596.6 9.7 0.2
KLCI �� 1,613.3 (1.7) (0.1)
SET �� 1,546.6 14.6 1.0
JCI �� 4,634.5 32.4 0.7
PCOMP �� 6,648.6 27.8 0.4
KOSPI �� 2,024.6 38.8 2.0
TWSE �� 8,029.1 68.2 0.9
Nikkei �� 11,468.3 95.9 0.8
STI Index Performance
Singapore
Total Market cap (US$bn) 637
Total Daily Vol (m shrs) 7,354
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
20 Feb
Target Price
($)
Noble Group Buy 1.180 1.50
Neptune Orient Lines Buy 1.235 1.45
Keppel Corp Buy 11.710 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
20 Feb
Target Price
($)
Tiger Airways Buy 0.745 0.95
Ezra Holdings Buy 1.160 1.58
Tat Hong Holdings Buy 1.535 1.80
China Merchants Buy 0.900 1.20
Midas Holdings Take profit 0.560 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Capitaland reported 4Q12 revenue of $1.1b, +4.9% yoy,
while net profit of $263m was down 44.9% yoy. For the full
year, it recorded revenue of $3.3b while net profit came in at
$930m, -12.9% yoy. This is slightly ahead of consensus
estimates. The decline was largely due to smaller revaluation
and portfolio gains. Stripping out these factors, the group
saw operating net profit of $369m, up 4.9% yoy. The
improvement was due to higher contributions from
development activities in Singapore, China and Australia as
well as better shopping mall business at CMA. Will provide
more updates after the analyst briefing. We currently have a
Buy call on the stock. TP of $4.09 is under review.
4Q12 revenue for Ezion came in at US$52m (+92% y-o-y,
+35% q-o-q), with net profit of US$20m (+86% y-o-y, +26%
q-o-q). This brought FY12 topline to US$159m (+48% y-o-y)
and headline net profit to US$79m (+36% y-o-y). Stripping
out exceptionals (disposal gain for one liftboat sold and
leased back during the year), core FY12 net profit was
US$65m (+38% y-o-y), in line with expectations. More
updates post analyst briefing this morning. Maintain BUY, TP
of S$2.12 under review.
Maxi-Cash Financial Services Corporation is proposing a
bonus issue of up to 71.04m new shares on the basis of one
(1) Bonus Share for every five (5) existing shares held.
Koh Brothers has been awarded a S$99.8m contract from the
PUB, Singapore’s national water agency. The contract, with a
contract period of 36 months, has commenced on February
18, 2013. This project is the second phase in a three-phase
expansion of the Bukit Timah First Diversion Canal.
The Lippo group and a private equity fund have invested
$37.54m in GSH Corp through a stock placement as the
trading company enters the Chinese real estate development
market. GSH said it will use $3m of the net proceeds of
$37.5m for working capital, and the rest will be used for
prospective merger and acquisition opportunities.
The Year of the Snake could bring with it more initial public
offerings (IPOs) into a buoyant equity market, investment
bankers say. The Singapore market has had three listings so
far this year, raising some $91.6m, according to SGX data. In
comparison, no IPO had been launched by this time last year
as prospects of a China slowdown and a crash in the
economies of Europe and US had left issuers and
underwriters wringing their hands. All three - construction
firm Logistics Holdings, Rubber processor Halcyon Agri and
Overseas Education Limited are all currently trading above
their IPO price. For the whole of last year, SGX had 21 listings
raising US$4.1bn in total, Dealogic data showed.
Singapore Changi Airport handled 4.33m passenger
movements in January, an increase of 1.9% y-o-y. Air traffic
movements rose 2.2% y-o-y to 28,200 flights. The Chinese
New Year holidays in January last year meant that there was
a higher traffic base which affected the magnitude of growth
last month. Passenger traffic at Changi hit a record high of
51.2m passenger movements last year, up 10% from the
previous year.
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PostPosted: Fri Feb 22, 2013 11:22 am    Post subject: Reply with quote

Today’s Focus
• Genting Singapore - Earnings on a rebound; upgrade to
BUY, TP raised to S$1.73
• SembCorp Marine - Risk to margin recovery, FY13/14F
earnings cut by 10%/9%; downgrade to HOLD with
lower TP of S$5.00
Singapore's economy expanded in the fourth quarter at a
faster pace than earlier estimates had shown. GDP grew 3.3%
q-o-q, vs the 1.8% q-o-q growth estimated in January and
compared to a 4.6% q-o-q contraction in 3Q. On a y-o-y
basis, fourth-quarter GDP grew 1.5%, versus the earlier
estimate of 1.1%. The government maintained its forecast for
2013 of GDP growth of between 1.0% and 3.0%.
FY12 results for Genting Singapore within expectations,
earnings recovered q-o-q with stronger rolling chip and steady
mass growth. We look forward to seasonally stronger earnings
in1Q13 from CNY and recovery in EBITDA margin in 2Q13 as
the recently completed Western Zone ramps up (remaining
Dolphin Lagoon to open at a later stage). We see potential
acquisitions over the next 12 months. Funding is not an issue
given its strong balance sheet (net cash S$1.8bn) and
operating cashflows (S$1-1.5bn p.a.). Upgrade to BUY, raise
SOP-based TP to S$1.73 (Prev S$ 1.60) as we tweak FY13-14F
earnings by 8-12%.
FY12 earnings for Sembcorp Marine disappoint on weak EBIT
margin; 8.0 Scts final/special DPS proposed, down from 20.0
Scts in FY11. While EBIT margins could have troughed in
4Q12, we see risks to margin recovery from 1) execution risks
from new designs, 2) lower margins at the start of product
delivery cycle, 3) lower than expected ramp up of higher
margin shiprepair jobs at the new Tuas yard. As such, we have
trimmed FY13/14F EBIT margin assumptions to 12.3%/12.6%.
Together with adjustments to our orderbook recognition
schedule and lower repair revenue, these result in a 10%/9%
cut to our FY13/14F earnings. We see possible risk to earnings
from margins, while we expect dividend upside to be capped
on likely greater capex commitments. Downgrade to HOLD
with lower TP of S$5.00 (Prev S$ 5.20). Our FY13 order wins
assumption of S$5.0bn is intact. We remain bullish on the
outlook for rig demand. Expect an initial reaction to $4.50 and
a minor rebound from there capped at $4.62. If $4.50 fails to
hold subsequently, expect downside to $4.36 before finding
firmer support.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 13,880.6 (46.9) (0.3)
S&P �� 1,502.4 (9.5) (0.6)
NASDAQ �� 3,131.5 (32.9) (1.0)
Regional Indices
ST Index �� 3,287.6 (21.3) (0.6)
ST Small Cap �� 575.8 (6.9) (1.2)
Hang Seng �� 22,906.7 (400.7) (1.7)
HSCEI �� 11,426.2 (256.Cool (2.2)
HSCCI �� 4,536.0 (60.6) (1.3)
KLCI �� 1,614.1 0.7 0.0
SET �� 1,528.7 (17.9) (1.2)
JCI �� 4,632.4 (2.0) (0.0)
PCOMP �� 6,667.4 18.8 0.3
KOSPI �� 2,015.2 (9.4) (0.5)
TWSE �� 7,957.5 (71.6) (0.9)
Nikkei �� 11,309.1 (159.2) (1.4)
STI Index Performance
Singapore
Total Market cap (US$bn) 638
Total Daily Vol (m shrs) 6,098
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
21 Feb
Target Price
($)
Noble Group Buy 1.165 1.50
Neptune Orient Lines Buy 1.220 1.45
Keppel Corp Buy 11.660 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
21 Feb
Target Price
($)
Tiger Airways Buy 0.735 0.95
Ezra Holdings Buy 1.150 1.58
Tat Hong Holdings Buy 1.500 1.80
China Merchants Buy 0.915 1.20
Midas Holdings Take profit 0.550 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Ezion report good 4Q12 results, FY12 net earnings +38%
y-o-y, driven by topline growth and healthy EBIT margins
of 36%. YTD contract wins adds US$23m on full-year
basis; FY14F EPS raised by 6%. Valuations are despite
sterling performance. Maintain BUY, TP raised to S$2.40
(Prev S$ 2.12).
FY12 results for Cosco Corp in line; final DPS of 2Scents
was declared. Cosco managed to shorten its delivery lead
time for dry bulk vessels to 10 months and reduce
offshore project losses, which led to margin improvement
in FY12. However, excess capacity in both the shipping
and shipbuilding sectors, as well as stiff competition in
offshore space pose great challenges to Cosco. Maintain
FULLY VALUED and TP S$0.80. The inflexion points are
turnaround of the shipping sector, better than expected
margins and market share gains in the offshore space.
Sheng Siong Group’s FY12 earnings in line, revenue and
earnings were within 2-3% of our projection.
Dividend of 1.75 Scents was declared; total payout of
2.75 S cents for FY12 (4.5% yield). We are expecting
13% and 9% increase in retail area for FY13F and FY14F
respectively. Maintain Hold, re-rate stock to higher TP of
S$0.68 (Prev S$ 0.51) but upside is limited on lofty
valuations.
Earnings for Hyflux in line; higher tax expenses offset
growth in revenue and improvement in margins in 4Q12.
Final dividend of 2.5Scts was declared (FY11: 2.0Scts).
Hyflux needs to deliver on contract wins and grow its
S$1bn EPC orderbook further to inspire more confidence.
Maintain HOLD on limited upside to TP of S$1.43 (Prev
S$1.39).
Hi-P recorded net profit of S$15.6m in 4Q12, which
brought FY12 net profit to S$17.9m (down 60% y-o-y),
but higher than our estimate of S$10m. This came on the
back of better than expected revenue and margins in
4Q12. Balance sheet is still healthy, but affected by
expansion mode. In terms of outlook, the Group expects
to record a loss in 1Q13, but overall expects to post
higher revenue and profits in FY13 compared to FY12.
This is largely in line with our expectations. Current Fully
Valued call and TP of S$0.70 under review.
Wilmar’s 4Q12 core net profit came in at US$401m
(+52% y-o-y; +3% q-o-q), slightly below our expectations
of US$445m. The main difference came from lower than
expected Palm & Lauric Merchandising and Processing
pretax of US$195m vs. US$269m pretax expectation and
lower than expected Sugar pretax of US$107m vs.
expectation of US$139m. Our current Hold call and TP of
S$3.81 under review.
Tiger Airways is contemplating shutting down its lossmaking
Australian operations if it does not get regulatory
approval to sell its controlling stake to Virgin Australia
(VA). Business Times understands from well-placed
sources that the budget carrier is studying such a
contingency, following recent ambivalence towards the
deal from the Australian competition regulator.
Keppel REIT proposes to undertake a placement of 40m
new units at an issue price of S$1.33 per New Unit, to
raise gross proceeds of S$53.2m. The issue price of
S$1.33 per New Unit represents a discount of 0.64% to
the adjusted volume weighted average price.
From the beginning of this year, property funds like Reits
buying industrial buildings from sellers on JTC-leased sites
will have to fork out a land premium upfront to JTC for
the remaining part of the lease term. They can no longer
continue paying JTC a monthly land rental, if that is what
the seller was doing.
Concerns that the FED may slow the pace of stimulus
suppressed US stocks for a second session. Economic data
also weighed down with the Philadelphia general
economic index declining to -12.5, the lowest reading
since June 2012. The latest weekly jobless claims rose 20k
to 362k while existing home sales increased 0.4%.
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PostPosted: Mon Feb 25, 2013 9:51 am    Post subject: Reply with quote

Today’s Focus
 NOL - Worst is over; current freight rates rebounded from
4Q12 lows, further rate hikes planned in March-April.
Maintain BUY with S$1.45 TP
The government will announce the FY13 budget later today.
This budget will focus more on longer-term challenges than
short term risks to the economy. Specifically, to sustain longerterm
growth given an aging population and the moderation in
labour growth, productivity improvement and fostering
inclusive growth will continue to take centre-stage in this
budget. Concrete medium term measures to improve public
infrastructure will also be introduced to ease some of the
current bottlenecks. We expect many measures to help
companies offset the transition costs from the ongoing
restructuring and to boost productivity. For households, an
outright cash handout or a generous special transfer package
will be visibly lacking in this budget. The focus this time will be
on preparing the baby boomers for retirement, catering to an
aging population, as well as skills upgrading to mitigate
against the side effects of the restructuring.
Losses in 4Q12 for NOL were higher than expected, but
current freight rates have rebounded from 4Q12 lows. We
think that the worst is over. After the slide in rates for much of
2H12, liners were able to push through spot rate increases on
the mainlanes in late-2012/ early 2013, which means that
liners started FY13 on a much better footing than in FY12.
Spot Asia-Europe and Asia-US rates are currently about 30%
and 20% higher compared to early December 2012. Liners are
advocating further rate hikes in March-April. FY13F earnings
are likely to benefit from lower cost base and better industry
discipline. Maintain BUY with S$1.45 TP (1.2x FY13 P/BV).
4Q12 core earnings for Wilmar came in at US$401m – slightly
below forecast. Stronger-than-expected Oilseeds & Grains and
Plantations pretax contributions were offset by weaker-thanexpected
Palm & Lauric and Sugar. Final DPS of S$0.03 was
declared, payable on 14 May13. HOLD call maintained. TP
adjusted slightly higher to S$3.88 (Prev S$3.81).
Yangzijiang posted a 10% y-o-y decline in net profit to
Rmb3.6bn in FY12 (its first y-o-y decline in history), in line with
expectations. A final DPS of 5 Scents was declared. Earnings
US Indices Last Close Pts Chg % Chg
Dow Jones  14,000.6 119.9 0.9
S&P  1,515.6 13.2 0.9
NASDAQ  3,161.8 30.3 1.0
Regional Indices
ST Index  3,288.1 0.5 0.0
ST Small Cap  576.2 0.5 0.1
Hang Seng  22,782.4 (124.2) (0.5)
HSCEI  11,317.1 (109.1) (1.0)
HSCCI  4,532.3 (3.7) (0.1)
KLCI  1,622.1 8.0 0.5
SET  1,540.1 11.4 0.7
JCI  4,651.1 18.7 0.4
PCOMP  6,665.1 (2.3) (0.0)
KOSPI  2,018.9 (5.Cool (0.3)
TWSE  7,947.7 (9.7) (0.1)
Nikkei  11,385.9 76.8 0.7
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 632
Total Daily Vol (m shrs) 4,605
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
22 Feb
Target Price
($)
Noble Group Buy 1.190 1.50
Neptune Orient Lines Buy 1.225 1.45
Keppel Corp Buy 11.590 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
22 Feb
Target Price
($)
Tiger Airways Buy 0.740 0.95
Ezra Holdings Buy 1.155 1.58
Tat Hong Holdings Buy 1.505 1.80
China Merchants Buy 0.920 1.20
Midas Holdings Take profit 0.520 0.50
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
recovery beyond FY14 will hinge on the pace of recovery
in the shipping market, rebound in newbuild orders and
margins. Maintain HOLD for decent 3-5% yield and
inexpensive valuation; TP revised to S$1.10 (Prev S$ 1.20).
EMS Energy is expected to report a loss for its FY12
results as a result of reduction in turnover and gross
profit. This was mainly attributable to fewer new
signification projects secured in FY2012 coupled with
delays in several project schedules, and also provision for
doubtful debts and goodwill written-off.
Sinwa is expected to record a loss in FY2012, mainly due
to losses from the engineering and charter businesses
which has been affected by the slowdown in the marine
sector, and also impairment and currency losses.
Property consultants expect development charge (DC)
rates - payable for enhancing the use of some sites or
building bigger projects on them - to head upwards come
March 1 for all major use groups. They cite an
appreciation in land values over the past six months. In
some cases, the hikes could be in double digits. The
average DC rate for industrial use, which saw the biggest
hike (among major use groups) of 14.3% in the last
revision six months ago, could potentially rise 8-12% this
round, according to Jones Lang LaSalle. Colliers
International projects an increase of 5-10%, while Knight
Frank is predicting the appreciation will be 3-5%.
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