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DBSVickers Reports March 2013
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Posts: 1350

PostPosted: Fri Mar 01, 2013 9:48 am    Post subject: DBSVickers Reports March 2013 Reply with quote

Today’s Focus
 City Development - Upgrade to HOLD on valuation, TP
raised to S$12.23
 Banyan Tree - Brighter outlook for hotels and property
sales. Upgrade to BUY, TP S$0.83
 Yanlord Land - Downgrade to FULLY VALUED with
unchanged TP of S$1.24 due to expensive valuation and
policy headwinds
Results for City Development were in line with our projections.
The group sold a total of 2,395 homes in 2012 valued at
S$2.78bn vs 1818 units in 2011 (S$1.76bn). This would
continue to underpin earnings visibility going forward. For
2013, it plans to offer another 900 units in 1H13. Upgrade to
Hold on valuation, TP raised to S$12.23 (Prev S$ 11.8Cool. We
like the group’s quick asset turn strategy which has enabled
them to lock in strong residential presales and boost forward
earnings visibility.
4Q12 results for Banyan Tree Holdings saw an improvement.
Outlook for hotels and property sales has improved. Upgrade
to BUY, TP S$0.83 (Prev S$ 0.79). With improved indicators
(operating outlook in Thailand and returning property sales),
we are increasingly confident of BTH’s ability to deliver
stronger profits in FY13F.
FY12 results for Yanlord Land in line with our estimates and
consensus forecasts. Yanlord is accelerating construction but
this may not drive pre-sales growth until 4Q13/2014.
Downgrade to Fully Valued with unchanged TP of S$1.24 due
to expensive valuation and policy headwinds.
Ying Li’s 2012 core profit of Rmb81m (down 8% y-o-y) below
expectations, largely due to slower-than expected revenue
recognition. 2013 earnings outlook is bright due to full year
contribution of rental revenue from IFC and revenue
recognition from Int’l Plaza. New reputable CEO will help set
up an efficient operating system and source lower cost offshore
loans. Maintain BUY with higher TP of S$0.55 (Prev S$
0.51) (40% discount to RNAV).
US Indices Last Close Pts Chg % Chg
Dow Jones  14,054.5 (20.9) (0.1)
S&P  1,514.7 (1.3) (0.1)
NASDAQ  3,160.2 (2.1) (0.1)
Regional Indices
ST Index  3,270.0 8.8 0.3
ST Small Cap  574.1 2.3 0.4
Hang Seng  23,020.3 443.3 2.0
HSCEI  11,437.2 292.8 2.6
HSCCI  4,591.6 102.7 2.3
KLCI  1,637.6 13.5 0.8
SET  1,541.6 23.5 1.6
JCI  4,795.8 79.4 1.7
PCOMP  6,721.5 105.2 1.6
KOSPI  2,026.5 22.5 1.1
TWSE  7,898.0 17.1 0.2
Nikkei  11,559.4 305.4 2.7
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$bn) 619
Total Daily Vol (m shrs) 7,793
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
28 Feb
Target Price
($)
Noble Group Buy 1.185 1.45
Neptune Orient Lines Buy 1.180 1.45
Keppel Corp Buy 11.640 13.00
CapitaLand Buy 3.910 4.42
Stock Picks – Small /Mid Cap
Rec’n Price ($)
28 Feb
Target Price
($)
Tiger Airways Buy 0.725 0.95
Ezra Holdings Buy 1.130 1.58
Tat Hong Holdings Buy 1.520 1.80
China Merchants Buy 0.930 1.12
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
Venture’s FY12 results below expectations but margin
rebounded in Q4. DPS adjusted to S$0.50 from S$0.55 but
6% yield is still decent. We expect better 2013 but more
strength in H2. New programmes and more profitable mix
are expected to drive growth in H2. TP raised to S$9.17 (Prev
S$ 7.62) after pegging to 15.6x PE (hist. mean). Maintain
Hold.
FY12 results for Tiong Seng in line; dividend of 1 Scts was
declared (yield 4%). Construction orderbook remain
robust. While management expects labour costs owing to
the levies and tightening man-year-entitlements (MYE) to
pressure margins in the coming 2 years, impact is likely to
be fairly marginal (at cS$1m hike in cost) and lower than
peers given the group’s focus in automation and
technology (through the automated pre-cast factory and
formworks) in its construction activities. In addition, the
group also acquired a site in Iskandar region to build
another pre-cast factory. Its property division is expected
to contribute meaningfully from FY13 onwards. Maintain
BUY, TP S$0.33 (Prev S$ 0.25).
Noble Group’s 4Q core profit above expectations, aided
by tax credit. Growth in Energy and MMO segments was
partially offset by lower grain & oilseeds crush margins.
FY13/14F core earnings were trimmed by 4% each on
lower agriculture profitability. Maintain BUY; TP S$1.45
(Prev S$ 1.50).
4Q/FY12 earnings, FY12 DPS of 7.1Scts for Super Group
were in line with expectations. Attractive 30% growth in
FY13F is supported by expanding product range and
higher ingredients utilisation. Maintain BUY, TP raised to
S$4.68 (Prev S$ 3.51) on peer group re-rating.
Golden Agri’s 4Q12 core earnings came in at US$36m (-
60% q-o-q, -60% y-o-y), less than half of what we had
expected (US$76.3m), and below consensus, The poor
results were dragged by drop in CPO prices, higher CPO
inventory and weak China business. We are neutral to the
results, as we believe it has largely been priced in.
Nam Cheong has entered into US$130m worth of
contracts with Bumi Armada. The orders are for four
MPSVs including option to build four additional units. The
contracts represent one of the largest collective wins in
Nam Cheong’s corporate history, and are expected to
contribute positively to FY2013 – FY2015 earnings. Nam
Cheong’s order book is now RM1.3 bn.
Yoma Strategic Holdings is acquiring a 70% stake in
German Car Industries Company (GCI) for US$700,000.
GCI is an established premier service centre for European
vehicles in Yangon that was established in 1996. We are
positive on this acquisition because it is a good spring
board for Yoma's entry into the car servicing/distributing
industry in Myanmar, especially the luxury segment. GCI is
profitable with an average PBT margin of 25%. This
acquisition would enable Yoma to gain a foothold in the
niche market of servicing European brands and would
complement its involvement in Japanese autos. Yoma
intends to seek one or two more distributorships in time,
Financially, we believe contributions could start in FY14.
Separately, the group is exploring the possibilities of
acquiring another 12-acres (522k sq ft) site at the fringe
of Yangon City Centre from SPA group under the first
right of refusal deed (FRRD). This proposed acquisition site
is located next to FMI City which is currently more than
95% sold.
Development charge rates for most property segments
continued to climb. The rates, effective from 1 Mar 2013
saw the largest average increases of 26% for land slated
for hotel use while those in the commercial segments was
revised up by 24%. Within the residential segment, DC
rates remained relatively unchanged with a 4% upward
revision for landed properties and 0% for non-landed use.
The average for industrial use was raised by 0.6%.
Amongst the sub-segments, the largest increases in the
commercial space of up to 39% was seen in Yishun,
Sembawang, Woodlands, Choa Chu Kang and Jurong
West. In the hotel segment, the largest 46% jump in DC
rates was seen in the Jurong Lake District area. Within the
residential segment, landed residential DC went up by 7-
15% in areas in the east such as Tanjong katong, Telok
Kurau, East Coast, Bayshore and Bedok South. The hikes
are unlikely to have any significant impact on the property
market, and property stocks, as the latest DC rate
changes will only affect projects that involve a change of
use or density.
Singapore’s bank lending picked up in January, as loans
to businesses and consumers grew 18.3% y-o-y,
marginally faster than December's 16.7% growth.
Domestic banking unit (DBU) loans rose 1.8% to $499.5
bn at the end of January, a touch slower than December's
1.9% m-o-m growth. Loans to businesses rose 2.3% over
the month to $290.8 bn, slowing slightly from the 2.6%
growth in December. But compared to a year ago, total
business loans expanded 20.7%, faster than December's
18% growth. Consumer loans grew a stronger 1.1% in
January to hit $208.7 billion, after growing 0.9% m-o-m
in December. On a y-o-y, consumer loans growth
accelerated to 15.2%, from December's 15% growth.
Housing and bridging loans, the largest consumer loans
segment, grew a slightly stronger 1.4%, compared with
December's 1.1% m-o-m growth.
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PostPosted: Mon Mar 04, 2013 9:43 am    Post subject: Reply with quote

Today’s Focus
 STI - Pullback to 3207 in weeks before resuming climb to
3455 by end-June
The just concluded results season led to only modest change
to STI’s 14.13x (Ave) forward PE levels. Assuming STI continues
to stick around the Ave 12-mth forward PE line, it should head
for 3450 by end-June and 3600 by year-end. That’s an average
pace of 45pts/mth, much more gradual than the c.145pts/mth
momentum that lifted it from 2945 in mid-Nov last year to
3320 by 4th Feb. While STI’s major rising trend stays intact, we
think a short-term consolidation has likely started that can
resulted in a further dip to 3207 in coming weeks before the
rising trend continues.
Hotel room rates in Singapore climbed to a record high,
coming in at an estimated $261 for 2012 as a whole and
Singapore’s average rate among the priciest in the region.
Those who stayed in luxury hotels here paid an average room
rate of $428 last year. The hospitality industry closed the doors
on 2012 with an estimated $2.8 billion in room revenue, up
5.9% from 2011. After slumping to $190 in 2009, the average
room rate (ARR) has been growing steadily in recent years,
increasing from $218 in 2010 and surpassing pre-crisis levels
to hit $247 in 2011. ARR jumped further to $261 last year and
although the average occupancy rate (AOR) was flat, it still
registered a respectable 86%. This puts 2012 revenue per
available room (RevPAR) - an indicator of performance - in the
region of $226, up from $214 in 2011.
Far East Hospitality Trust has announced that they have
obtained BBB- investment grade rating by Fitch. With this
rating, the trust will be empowered with greater financial
capability to increase its aggregate leverage limit to a
maximum of 60% or a potential debt headroom of S$600m,
allowing the trust to be opportunistic in executing acquisitions
without its previous constraints of a c35% gearing limit
(current gearing 29%). In the near term, we look forward
conclusion of its negotiations (non-binding MOU) with Straits
Trading Limited on the acquisition of Rendezvous Singapore
and its accompanying Gallery Wing, of which we have yet to
factor in this acquisition given the lack of financial details.
While we estimate that the trust has the financial capability
US Indices Last Close Pts Chg % Chg
Dow Jones  14,089.7 35.2 0.3
S&P  1,518.2 3.5 0.2
NASDAQ  3,169.7 9.6 0.3
Regional Indices
ST Index  3,269.5 (0.4) (0.0)
ST Small Cap  566.1 (8.0) (1.4)
Hang Seng  22,880.2 (140.0) (0.6)
HSCEI  11,344.2 (92.9) (0.Cool
HSCCI  4,588.3 (3.3) (0.1)
KLCI  1,637.4 (0.2) (0.0)
SET  1,539.6 (2.0) (0.1)
JCI  4,811.6 15.8 0.3
PCOMP  6,642.3 (79.2) (1.2)
KOSPI  2,026.5 22.5 1.1
TWSE  7,964.6 66.7 0.8
Nikkei  11,606.4 47.0 0.4
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 620
Total Daily Vol (m shrs) 7,072
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
1 Mar
Target Price
($)
Noble Group Buy 1.175 1.45
Neptune Orient Lines Buy 1.190 1.45
Keppel Corp Buy 11.700 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
1 Mar
Target Price
($)
Tiger Airways Buy 0.720 0.95
Ezra Holdings Buy 1.115 1.58
Tat Hong Holdings Buy 1.515 1.80
China Merchants Buy 0.920 1.12
Source: Bloomberg, DBS Vickers
Singapore
Wired Daily
Page 2
to fully debt-fund this acquisition, we believe that the
manager could look to a fund this proposed acquisition
through a mix of debt/equity given that FEHT is trading at
c1.15x P/BV with low implied cost of capital of c5.0%.
Silverlake Axis has secured a new software and services
contract from Hong Leong Bank, Malaysia to implement
an Enterprise Payment Platform (EPP) Solution. The
contract is expected to contribute positively to the Group
in the current and next financial year.
SIIC Environment Holdings has been awarded an
engineering, procurement and construction contract to a
desalination system project in Guangdong Province, PRC.
The total value of the contract is approximately RMB 80m
and is expected to be completed in middle of 2014.
Advanced Systems Automation is placing 100m new
shares at an issue price of S$0.0189 per share, a discount
of approximately 10.0% to the last weighted average
price. The net proceeds of about S$1.9m will be used for
general working capital purposes.
EMS Energy is placing 60m new shares at S$0.042 per
share, a discount of approximately 3% to last weighted
average price, to raise gross proceeds of about S$2.5m.
The proceeds will be used for the funding of the Group’s
order book and for other general working capital
purposes.
China's non-manufacturing purchasing managers' index
(PMI) stood at 54.5, down from January's 56.2 and the
slowest pace of expansion since Sep 12. Although a fivemonth
low, the PMI reading indicates that the services
sector is still experiencing growth. The PMI new orders
sub-index fell to 51.9 in February from 53.8 in the
previous month. The sub-index for construction in
February fell to 58 from 61.6 in January. But the sectors
of air and rail transport, environmental protection,
logistics, and retail maintained robust growth, with their
sub-indices hovering over 60 in February.
Activity in the manufacturing sector also slowed in
February. Two sets of purchasing mangers' index released
came in below analysts' expectations. The official PMI
published by the National Bureau of Statistics registered
50.1 points, the lowest since September. Meanwhile, the
PMI compiled by HSBC and Markit stood at 50.4 points, a
four-month low, in line with a preliminary reading
published last week.
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PostPosted: Tue Mar 05, 2013 9:59 am    Post subject: Reply with quote

Today’s Focus
• Sound Global – Management changes a positive
development
The downdraft from China in reaction to details of the
property measures and weaker Feb PMI data ignited worries
that the country’s recovery is stalling, which spilled over the
rest of Asia, triggering selling across the board. STI fell 30pts
to 3239. Small caps were affected worse. STI’s decline was
within our technical view for it to consolidate towards 3207
resuming its major rising trend.
We maintain our view that STI’s decline yesterday is part-parcel
of a much needed short-term pullback to consolidate the gains
in recent months. Otherwise, the major rising trend stays is
intact that has the potential to head towards 3450 by end-
June. The McClellan Oscillator, an indicator for short-term
market breadth, fell to -53 yesterday, which is the lowest
reading in recent months and nearing the extreme oversold of
-70. A minor rebound is seen today. Post rebound, any further
subsequent downside should be limited at 3207, in line with
our earlier view.
We think the China property measures are sector specific and
do not signal an imminent broad monetary tightening. The
Chinese government has done the right thing by taking swift
action to check asset inflation. Meanwhile, the weak Feb PMI
numbers has got plenty to do with the Chinese New Year
holiday effect. CNY fell on February this year while it was in
Jan last year. Activities will usually slow during the festive
period due to the lesser number of working days in the month
plus workers going on vacation leave. The numbers should
swing back to norm come March. The same goes for the weak
Singapore February PMI data released yesterday that slipped
into contraction. Despite the Feb CNY distortion, we observe
that the Singapore electronics segment reading even rose to
52.1 from 49.9.
We think Sound Global shares have fallen to good support
yesterday. The stock tumbled 17% yesterday in reaction to
news of a couple of changes in top management. Among the
changes, Mr Wang Kai will cease to be the CEO of the firm
but will take over CFO role with effect from 4 March following
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,127.8 38.2 0.3
S&P �� 1,525.2 7.0 0.5
NASDAQ �� 3,182.0 12.3 0.4
Regional Indices
ST Index �� 3,240.0 (29.6) (0.9)
ST Small Cap �� 554.9 (11.2) (2.0)
Hang Seng �� 22,537.8 (342.4) (1.5)
HSCEI �� 11,104.7 (239.6) (2.1)
HSCCI �� 4,455.6 (132.7) (2.9)
KLCI �� 1,636.0 (1.5) (0.1)
SET �� 1,540.7 1.1 0.1
JCI �� 4,761.5 (50.2) (1.0)
PCOMP �� 6,637.6 (4.7) (0.1)
KOSPI �� 2,013.2 (13.3) (0.7)
TWSE �� 7,867.3 (97.3) (1.2)
Nikkei �� 11,652.3 45.9 0.4
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$bn) 619
Total Daily Vol (m shrs) 4,989
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
4 Mar
Target Price
($)
Noble Group Buy 1.150 1.45
Neptune Orient Lines Buy 1.165 1.45
Keppel Corp Buy 11.500 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
4 Mar
Target Price
($)
Ezra Holdings Buy 1.080 1.58
Tat Hong Holdings Buy 1.480 1.80
China Merchants Buy 0.910 1.12
United Envirotech Take profit 0.640 0.65*
Source: Bloomberg, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
departure of the previous CFO. The newly appointed CEO,
Mr Zhang Jingzhi, is Sound’s old guard with 11 years of
experience and with solid credentials. We do not expect any
impact on business as Chairman and founder Mr Wen Yi-Bo
remains a key pillar within the group. The decline to $0.53
yesterday coincides with a technical projection low point at
$0.52. The sell-down has opened up an accumulate
opportunity.
Singapore’s purchasing managers' index (PMI) for February
fell to 49.4 from 50.2 in January, despite an improvement in
the key electronics sector. This was due to declines in new
orders, production output and imports. The data was also
partly distorted by the fact that Chinese New Year fell in
January last year and February this year. The electronics
reading rose from 49.9 in January to 52.1 in February, to
signal expansion for the first time in five months. Our
economist had expected the electronics cluster to turn
around due to the improving demand. But the uptick comes
earlier than predicted. Whether this improvement will be
sustainable remains to be seen. Singapore’s electronics
cluster has been a laggard to the global electronics cycle.
High cost, structural hollowing-out, the strong Sing dollar
and the inability to be part of the regional supply chain for
smartphones have affected the performance for this industry.
Beyond the recent set of PMI numbers, we are sticking to our
view that a more pronounced improvement will only be seen
after the second quarter.
Indofood has doubled its shareholding interests in China
Minzhong from 14.95% to 29.33%. The additional 14.38%
stake came from the acquisition of 94.25m shares from
Tetrad Ventures for about $105.6mn, or $1.12 a share.
Tetrad, an investment company of the Government of
Singapore Investment Corporation, sold its equity stake on
Feb 28.
BBR Holdings wins new contracts worth S$61.6m. These
include a contract for the construction of the prestigious
Dulwich College in Singapore and a number of structural
work and specialist engineering contracts in Singapore and
Malaysia. With these recent wins, order book now stands at
S$1.02 billion with projects lasting to 2015.
Logistics Holdings has been awarded the building works
at Bukit Merah Contract 19C & 19D and contingency
works amounting to S$59.5m by the Housing &
Development Board. With the award of the Project, the
Group’s current order book amounted to approximately
S$278m.
CSC Holdings has secured foundation contracts
aggregating in excess of $100m in the past 4 months.
Among the notable awards are foundation contracts for
the Klang Valley Mass Rapid Transit (KVMRT) projects in
Malaysia. As at 1 March 2013, CSC’s order book stands
at approximately $240m with the bulk of its projects
expected to be completed over the next few quarters.
YHM Group proposes to raise capital by way of a
placement of S$30m 5.00% convertible perpetual capital
securities. Each Capital Security will, at the option of the
holder of the Capital Securities be convertible into fully
paid ordinary shares at a conversion price of S$0.025 per
new Share. The conversion price represents a discount of
40.5% to the last volume weighted average price of
S$0.042. The proceeds will be mainly used to finance
investments in the new business of offshore and on-shore
oil & gas and marine related businesses.
Sino Grandness Food Industry Group is placing up to
28.5m new shares at an issue price of S$0.82 per
Placement Share, a discount of approximately 9.66% to
the last weighted average price. Net proceeds of about
S$22.7m will be used for capital expenditure and sales
and marketing expenses for domestic canned food
products, and also as working capital for the Group.
Rescued by a giant Chinese fruit juice producer, New
Lakeside Holdings, an apple juice concentrate maker with
a troubled past, resumes trading on Catalist today. It has
swung back to the black in its latest financial results, had
its debt restructured with a capital injection, and is now
known as Zhongxin Fruit and Juice Limited. Key to the
restructuring was Shanghai-listed SDIC Zhonglu Fruit
Juice, which now owns a 53.11% stake in the company.
SDIC Zhonglu accounts for 15% of China's total fruit
juice exports and up to 10% of the global fruit juice
market.
In property news, Guthrie has picked up 2HR at 2
Havelock Road in a deal that value the asset at
$282.88mn, or $1,626psf, based on its current net
lettable area (NLA) of 173,912 sq ft. The seven-storey
commercial building is on a site with a remaining lease of
about 69 years. It is the last of AEW's major property
assets in Singapore.
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PostPosted: Wed Mar 06, 2013 9:29 am    Post subject: Reply with quote

Today’s Focus
• Hi-P International – Upgrade to HOLD on valuation;
earnings yet to stabilise
The Dow rose into all-time high territory led by cyclical stocks
on optimism about continued central bank stimulus and a
better-than-expected ISM non-manufacturing number (actual
56, consensus 55). At the same time, China maintained its
7.5% growth target for the year, which also triggered a relief
rally yesterday. This is the heavy data week for US that
culminate with February job numbers. Consensus expects nonfarm
payroll figure of 160k with the unemployment rate
staying at 7.9%.
DBSV Research is upgrading Hi-P International to HOLD on
valuation. FY12 earnings hit a new low. Management expects
both revenue and profit to improve in FY13 but they have
guided for a loss in 1Q13 as seasonally lower volumes and
lower Apple orders are unlikely to cover a higher cost base.
We expect breakeven in 1H13 and a steep ramp up in 2H13.
Overall, FY13 earnings are expected to rise, but outlook is still
weak. We have cut FY13F earnings by 32% to factor in lower
margin assumptions. Growth drivers are Blackberry launches,
better sales mix and further cost restructuring. We believe Hi-
P’s share price reflects most of the downside risk after
correcting 20% since our downgrade last Oct. But, it is too
early to turn positive as earnings have yet to stabilise. We have
lifted TP to S$0.71 (Prev S$ 0.70) as we roll over to 1x FY13
P/BV.
Structural steel specialist TTJ Holdings has clinched $20m
worth of new contracts in Singapore. This lifted its order book
to $182m, the bulk of which it expects to substantially
complete in FY2013 and FY2014. The latest contracts will see
the group supply structural steelworks and civil defence shelter
doors for the Tampines East Station on the Downtown Line 3
and other projects.
STATS ChipPAC is issuing its concurrent offering of US$255m
senior notes in a private placement at par. This offering is
concurrent to an offer of new notes in exchange for the
group's outstanding US$600m principal amount of 7.5%
senior notes due in 2015. Like the exchange offer, the
concurrent offer notes are due in 2018, with interest of 4.5%
per annum payable semi-annually. The notes are redeemable
at the company's option from March 20, 2016.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,253.8 126.0 0.9
S&P �� 1,539.8 14.6 1.0
NASDAQ �� 3,224.1 42.1 1.3
Regional Indices
ST Index �� 3,248.3 8.3 0.3
ST Small Cap �� 560.2 5.2 0.9
Hang Seng �� 22,560.5 22.7 0.1
HSCEI �� 11,169.5 64.9 0.6
HSCCI �� 4,453.6 (2.0) (0.0)
KLCI �� 1,642.1 6.1 0.4
SET �� 1,549.3 8.6 0.6
JCI �� 4,751.7 (9.Cool (0.2)
PCOMP �� 6,711.7 74.2 1.1
KOSPI �� 2,016.6 3.5 0.2
TWSE �� 7,932.7 65.4 0.8
Nikkei �� 11,683.5 31.2 0.3
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 608
Total Daily Vol (m shrs) 3,841
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
5 Mar
Target Price
($)
Noble Group Buy 1.155 1.45
Neptune Orient Lines Buy 1.165 1.45
Keppel Corp Buy 11.54 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
5 Mar
Target Price
($)
Ezra Holdings Buy 1.100 1.58
Tat Hong Holdings Buy 1.485 1.80
China Merchants Buy 0.915 1.12
Source: Bloomberg, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
The possibility of CapitaLand divesting its investment in
Australand Property Group has attracted several parties, who
have expressed an interest in either the whole or parts of the
Australian subsidiary's business. Australand said that it is
making certain information available to selected parties to
determine whether any proposal can be developed. But both
Australand and CapitaLand emphasised that the expression
of interest by the parties did not mean that any definitive
proposal was forthcoming. CapitaLand's strategic review of
its investment in 59.3%-owned Australand is part of a
broader move unveiled by the property giant earlier this year
to streamline the group's business and focus on China and
Singapore.
China's securities regulator is set to relax rules to allow more
foreign investors to put their offshore renminbi holdings into
the A-share market. Market observers expect that a fresh
wave of RMB funds, including RMB200 billion (S$40 billion)
worth of unused quotas in Hong Kong, will flow into the
domestic liquidity pool and help sustain the A-share market's
turnaround.
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PostPosted: Thu Mar 07, 2013 9:34 am    Post subject: Reply with quote

Today’s Focus
• Singapore REITs - Strong appetite for growth; preferred
picks FCOT, Cache.
STI should take a breather following the gains made in the
previous session, in line with the mixed overnight performance
on Wall Street. The underlying tone should stay firm heading
of Friday’s employment number after the February ADP
employment change data released last night came in strongerthan-
expected, 198k against 170k consensus. The previous
month’s figure was also revised higher to 215k from 192k.
Consensus expectation for tomorrow’s non-farm payrolls is
163k.
We expected 2013 to be the “Year of Acquisitions” for the SREITs
but the pace has surprised us. YTD, S$852m worth of
deals have been concluded, partly funded by close to S$452m
of equity fund raisings. Buoyed by supportive equity markets
and strong balance sheets, we sense that S-REITs’ appetite for
acquisitions remains strong and believe that developersponsored
REITs can opportunistically tap their pipelines for
growth. Rising bond yields have limited impact on SREITs as
growth is being priced in. Our preferred picks are Fraser
Commercial Trust (FCOT, BUY TP $1.45) and Cache Logistics
Trust (Cache, BUY, TP S$1.40). Far East Hospitality Trust (FEHT,
BUY, TP S$1.13) is trading close to our target price but an
upgrade is likely if the trust delivers higher than expected
returns.
Global Logistic Properties has signed approximately 15,000
sqm (162,000 sq ft) of new leases with a third party logistics
provider in Changzhou, Eastern China. With the new lease,
the occupancy rate for GLP Park CND, GLP’s first development
in Changzhou, has reached 97% within three months of its
completion.
SBI Offshore is placing 34m new shares at an issue price of
S$0.108 per share. The Placement Price represents a discount
of approximately 10% to the last weighted average price. The
net proceeds of about S$3.6m will be used for market
expansion and business development plans when
opportunities arise.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,296.2 42.5 0.3
S&P �� 1,541.5 1.7 0.1
NASDAQ �� 3,222.4 (1.Cool (0.1)
Regional Indices
ST Index �� 3,291.8 43.5 1.3
ST Small Cap �� 561.3 1.2 0.2
Hang Seng �� 22,777.8 217.3 1.0
HSCEI �� 11,359.0 189.5 1.7
HSCCI �� 4,498.4 44.7 1.0
KLCI �� 1,651.8 9.8 0.6
SET �� 1,559.4 10.0 0.6
JCI �� 4,824.7 73.0 1.5
PCOMP �� 6,835.2 123.5 1.8
KOSPI �� 2,020.7 4.1 0.2
TWSE �� 7,950.3 17.6 0.2
Nikkei �� 11,932.3 248.8 2.1
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 610
Total Daily Vol (m shrs) 6,414
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
6 Mar
Target Price
($)
Noble Group Buy 1.17 1.45
Neptune Orient Lines Buy 1.175 1.45
Keppel Corp Buy 11.73 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
6 Mar
Target Price
($)
Ezra Holdings Buy 1.100 1.58
Tat Hong Holdings Buy 1.505 1.80
China Merchants Buy 0.905 1.12
United Envirotech Take profit 0.680 0.65*
Source: Bloomberg, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
Mencast Holdings is re-evaluating the basis for the proposed
(1) Bonus Share for every one (1) Share held as one of the
listing rule (Rule 838 of the SGX-ST Listing Manual) requires
the company to ensure that its daily weighted average price,
adjusted for a bonus issue, is not less than S$0.50.
Three companies have been added to the watch-list of the
Singapore Exchange (SGX) for failing to meet the minimum
criteria for continued listing. They are precision steel strips
manufacturer Yong Xin International Holdings, specialty
chemicals producer Matex International, and China Oilfield
Tech, a solutions provider of integrated tertiary oil recovery
equipment and products. They have posted pre-tax losses for
three straight years and the 120-day average market value of
their stock failed to stay above $40m.
GSH Corp has unveiled plans to raise another $246.8m in net
proceeds through a rights issue. This, just two weeks after
the Lippo group's Golden Super Holdings and a privateequity
fund, SkyVen Growth Opportunities Fund, invested
$37.54m in GSH via a stock placement, most of which will go
towards prospective merger and acquisition (M&A)
opportunities. The renounceable and non-underwritten issue
of up to 4.94 bn rights shares priced at 5 cents apiece will be
on the basis of one rights share for every one existing share
held. The issue price is a 42.5% discount to the stock's
theoretical ex-rights price of 8.7 cents per share, based on its
closing price of 12.4 cents on Tuesday.
In property news, the freehold Kovan Lodge has been put up
for collective sale through tender. The asking price is a tad
below $30m, or around $790 psf of potential gross floor
area. No development charge is payable. Under the 2008
Master Plan, the 27,090 sq ft site is zoned for residential use.
The current asking price for Kovan Lodge is lower than the
$31.5mn that its owners had sought in an earlier launch last
year.
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PostPosted: Fri Mar 08, 2013 10:55 am    Post subject: Reply with quote

Today’s Focus
• Singapore Banks - Weak earnings trend ahead; prefer
OCBC (BUY, TP: S$11.50) over UOB (HOLD, TP: S$20.10)
• Hutchison Port Holdings Trust – Expanding market share
in HK; maintain BUY with higher TP of US$0.89
Singapore Banks are likely to post single digit earnings growth
this year. Non-interest income would be the key driver for
banks to deliver ‘above-expectations’ results as net interest
margin (NIM) is still likely to slip further and provisions to level
up. Therefore we are only forecasting 3% earnings growth in
2013. Despite softer earnings growth, Singapore banks’
balance sheets are strong. We see minimal risk to asset quality
while capital will remain strong. However, there is upside to
our forecast if the provision charge-off rate decline and loans
growth improved. We are forecasting 8% loan growth for
2013, still largely driven by business loans. In terms of stock
pick, we prefer OCBC (BUY, TP: S$11.50 (Prev. S$10.70)) over
UOB (HOLD, TP: S$20.10 (Prev S$ 19.70)).
Hutchison Port Holdings Trust is acquiring 100% stake in Asia
Container Terminal Holdings (ACT) for US$505m, to be fully
funded by debt. Net gearing will inch up from 0.34x to 0.42x
with this transaction, still well within reasonable limits. ACT
owns 2 berths in Kwai Tsing Port, Hong Kong and handled 1m
TEUs in 2012. This acquisition will raise HPHT’s market share in
HK to 57%, and provide revenue and cost synergies. FY13/14F
DPU raised by 3%/5%, assuming 4% cost of debt. Maintain
BUY with higher TP of US$0.89 (Prev US$ 0.85).
We are upgrading HongKong Land to BUY, target price revised
up to US$8.12 (Prev US$ 7.93). HKL reported stronger-thanexpected
contributions from residential sales in FY12. The
group is also stepping up its regional residential investments.
HKL should benefit from our expected bottoming out
of the Central office market. Continued new ventures in
different Asian cities and real estate sectors should not only
add growth impetus to the company but also diversify its
earnings profile. Overall, HKL is evolving as a regional property
play which should justify a higher valuation over the long term.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,329.5 33.3 0.2
S&P �� 1,544.3 2.8 0.2
NASDAQ �� 3,232.1 9.7 0.3
Regional Indices
ST Index �� 3,298.5 6.7 0.2
ST Small Cap �� 559.8 (1.5) (0.3)
Hang Seng �� 22,771.4 (6.4) (0.0)
HSCEI �� 11,311.5 (47.6) (0.4)
HSCCI �� 4,499.7 1.3 0.0
KLCI �� 1,650.9 (0.9) (0.1)
SET �� 1,561.0 1.6 0.1
JCI �� 4,848.3 23.6 0.5
PCOMP �� 6,725.1 (110.1) (1.6)
KOSPI �� 2,004.4 (16.3) (0.Cool
TWSE �� 7,960.5 10.2 0.1
Nikkei �� 11,968.1 35.8 0.3
STI Index Performance
Singapore
Total Market cap (US$bn) 616
Total Daily Vol (m shrs) 4,622
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
7 Mar
Target Price
($)
Noble Group Buy 1.175 1.45
Neptune Orient Lines Buy 1.185 1.45
Keppel Corp Buy 11.78 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
7 Mar
Target Price
($)
Ezra Holdings Buy 1.090 1.58
Tat Hong Holdings Buy 1.490 1.80
China Merchants Buy 0.900 1.12
United Envirotech Take profit 0.675 0.65*
Source: Bloomberg, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
ThaiBev will be added to the STI on March 18 and IHH
Healthcare, which has been on the STI for just six months,
will be removed. If F&N is taken private before the next
review, it will be replaced by the counter on the reserve list
with the highest market value. The reserve stocks are
Hutchison Port Holdings Trust, Keppel Land, Ascendas Real
Estate Investment Trust, UOL Group and CapitaCommercial
Trust. The next review will be on June 6. The Mid Cap index,
a basket of the 31st to 80th largest companies by market
value, will see Far East Hospitality Trust, Fortune Real Estate
Investment Trust and United Engineers replacing CAO, Hong
Leong Asia and Pacific Andes Resources Development.
Sitra Holdings is placing 75m new shares at an issue price of
S$0.0428 per share to raise S$3.2m. The issue price is about
10% discount to the last weighted average price. The
proceeds will be used for repayment of bank borrowings,
trade and other payables, and for working capital purposes.
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PostPosted: Mon Mar 11, 2013 9:55 am    Post subject: Reply with quote

Today’s Focus
• Singapore Strategy - Expect gradual ascend for STI; yearend
target 3600 based on FY14F earnings
We believe the Singapore market has shifted into a more
gradual ascend compared to the fast paced climb that lifted
the STI by 13% in mid Nov to reach 3320 in early February.
Liquidity has pushed STI’s forward PE up to its average of
14.1x, and has the potential to lift the index closer to 3600 by
year-end based on FY14F earnings. While temporary
choppiness is expected in the near term, we maintain our view
that equities will rise further in 2013, with momentum picking
up in 2H. We expect earnings to trough and further re-rating
will require earnings upgrades.
In terms of stock picks, we prefer to go for earnings resilience
or yield plays for the Big Caps. We like Global Logistics
(earnings stability and acquisition growth), ComfortDelgro
(stability and yield play), Hutchison Port (stability and yield),
and Keppel Corp (earnings visibility and yield). Key sectors
within the Small-Mid Caps sector which outperformed big
caps were capital goods (within the industrial sector) – oil and
gas equipment and construction equipment sectors, while
small cap REITS outperformed its large cap counterparts with
16% earnings rise, mainly from acquisitions boosting its low
base. We expect the recovery momentum in the offshore
services vessel sector to gain traction, as contract backlog has
been building up momentum in 1Q13. Top picks are Ezion and
Kreuz, niche players in a global market. Construction
equipment and supply players will benefit from robust demand
for infrastructure projects in this region but will be less
affected by curbs on foreign labour – our picks are Tat Hong,
Pan United, Tiong Woon and Sin Heng. We picked REITs that
offer superior growth prospects - Fraser Commercial Trust
(CAGR of 19%), Mapletree Commercial Trust (CAGR of 6%)
or REITS with a strong acquisition pipeline– Cache Logistics
and Far East Hospitality.
DBSV Research issues an Equity Explorer report on Tiong Woon
with fair value of S$0.45, offering potential upside of 29%
from current price. Tiong Woon is a one-stop, integrated
services provider of cranes and heavy lifting equipment. It is
leveraging on the buoyant offshore market and the increased
infrastructure spending in Singapore as our population grows.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,397.1 67.6 0.5
S&P �� 1,551.2 6.9 0.4
NASDAQ �� 3,244.4 12.3 0.4
Regional Indices
ST Index �� 3,289.5 (9.0) (0.3)
ST Small Cap �� 559.4 (0.4) (0.1)
Hang Seng �� 23,092.0 320.5 1.4
HSCEI �� 11,484.4 172.9 1.5
HSCCI �� 4,558.9 59.2 1.3
KLCI �� 1,654.0 3.0 0.2
SET �� 1,566.9 5.9 0.4
JCI �� 4,874.5 26.2 0.5
PCOMP �� 6,833.8 108.6 1.6
KOSPI �� 2,006.0 1.6 0.1
TWSE �� 8,015.1 54.6 0.7
Nikkei �� 12,283.6 315.5 2.6
STI Index Performance
Singapore
Total Market cap (US$bn) 616
Total Daily Vol (m shrs) 3,885
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg
Stock Picks – Large Cap
Rec’n Price ($)
8 Mar
Target Price
($)
Noble Group Buy 1.180 1.45
Neptune Orient Lines Buy 1.175 1.45
Keppel Corp Buy 11.850 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
8 Mar
Target Price
($)
Ezra Holdings Buy 1.085 1.58
Tat Hong Holdings Buy 1.455 1.80
China Merchants Buy 0.905 1.12
United Envirotech Take profit 0.675 0.65*
Source: Bloomberg, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
About 10% to 20% of Tiong Woon’s FY12 revenue comes
from the construction sector in Singapore. Tiong Woon is
expected to turnaround this year on the back of improving
industry backdrop. The last two quarterly results have also
shown significant improvement. We believe a 9x FY14F PE is
fair, vs target multiples of 12x for Tat Hong and 11x for Sin
Heng.
Singapore Press Holdings is planning an initial public offering
of its properties in Singapore. The planned listing will take
the form of a real estate investment trust. SPH did not detail
which properties will be included in the REIT or the size of the
planned IPO. The company owns retail malls including the
Paragon Shopping Mall in the Orchard shopping district.
Otto Marine has entered into a shipbuilding contract with a
renowned Indonesian operator to build two units of 5150 HP
Anchor Handling Tug Supply (AHTS) Vessels for an agreed
price of US$27.8m.
Asiatic Group is placing 50m new shares at an issue price of
S$0.065 each. The issue price represents a discount of
approximately 7.14% to the last weighted average price. The
net proceeds of about S$3.2m will be used to fund current
energy projects and for working capital purposes.
Speculative demand for industrial properties has eased,
following the seventh round of cooling measures, arresting
the problem of spiraling prices. Demand for strata factory
units slipped from 133 in the 28-day time-frame before the
introduction of the seventh cooling measure to 118 in the
period after. The monthly average demand for strata factories
also fell, to 173 transactions in the period from Jan 12, after
hitting a high of 321.8 transactions per month on average in
the second half of 2012 to Jan 11, 2013.
China’s trade data surprised on the upside in February, with
exports rising more than 20% last month, a positive sign for
China and its trading partners. Exports jumped 21.8% y-o-y
to US$139.4 billion in February, while imports fell 15.2% to
US$124.1 billion. As a result China posted an unexpected
trade surplus of US$15.3 billion.
Inflation in China rose to 3.2% y-o-y in February, up from
2.0% in January, to a 10-month high. Month on month the
consumer price index rose 1.1%, its highest increase in 13
months, with food prices a significant driver of the rise.
China's producer price index fell 1.6% y-o-y in February. The
fall was deeper than the 1.5% decline forecast by the
market. Month-on-month, producer price index rose 0.2%, a
sign that pricing in China's industrial sector is beginning to
stabilise as the recovery in China gathers pace.
China unveiled a government restructuring plan, cutting
cabinet-level entities by two and dissolving its powerful
Railways Ministry, as the country's new leaders look to boost
efficiency and combat corruption. The reforms mark the
biggest reduction in ministries since 1998 when then-premier
Zhu Rongji oversaw the overhaul of the State Council, and
coincides with growing public concern over transparency and
overlapping bureaucracies.
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PostPosted: Tue Mar 12, 2013 9:34 am    Post subject: Reply with quote

Today’s Focus
• SPH – Unlocking value for shareholders; special dividends
key catalyst. Upgrade to BUY, TP raised to S$4.79
We raised SPH to BUY as we believe asset price realisation will
be a trigger for the share price with the establishment of a real
estate investment trust (REIT). Through the successful listing of
the proposed REIT, we estimate SPH could see a cash inflow of
S$1.5bn-1.8bn assuming a retention of 40%-50% eventual
interest; shareholders should stand to reap special dividends.
Details are not available pertaining to the intended REIT, but
we believe Paragon and Clementi Mall could be the assets in
the initial portfolio. Target price raised to S$4.79 (Prev S$
4.01); further catalyst could come from the eventual launch of
the REIT, and if successful, potential for special dividend
payout.
Malaysia’s Feb13 palm oil output fell 19% m-o-m on seasonal
weakness to 1.296m MT (in line). But stronger-than-expected
exports (1.398m MT vs. 1.171m MT forecast) helped to cut
inventory to 2.443m MT (vs. 2.653m MT forecast). As output
rebounds in the coming months, expect stock levels to taper
off on higher domestic intake Most SGX-listed planters are
fairly valued, except for First Resources (20% upside to TP).
Overseas Union Enterprise is buying the US Bank Tower and
some related properties in Los Angeles for $367.5m. Overseas
Union will acquire the 72-floor office building, the adjacent
Maguire Gardens park and a carpark. US Bank Tower, located
in downtown Los Angeles, has an area of about 1.4 million
square feet and is currently about 56.3% occupied.
World Precision Machinery has secured two separate contracts
from an automobile parts maker and a home appliances
manufacturer with a total value of RMB13.65m. The contract
wins boost confidence of growth pick-up in the automotive
industry and white goods sector.
Q & M Dental Group is acquiring 70% stake in AR Dental
Supplies for RM8.4m. ARD is principally engaged in the
supply of dental material and equipment. It has operations
and sales offices in Selangor, Johor, Penang, Sabah,
Sarawak and Terengganu.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,447.3 50.2 0.3
S&P �� 1,556.2 5.0 0.3
NASDAQ �� 3,252.9 8.5 0.3
Regional Indices
ST Index �� 3,293.0 3.4 0.1
ST Small Cap �� 555.4 (4.0) (0.7)
Hang Seng �� 23,090.8 (1.1) (0.0)
HSCEI �� 11,435.8 (48.5) (0.4)
HSCCI �� 4,515.5 (43.3) (1.0)
KLCI �� 1,658.0 4.0 0.2
SET �� 1,577.7 10.7 0.7
JCI �� 4,854.3 (20.2) (0.4)
PCOMP �� 6,814.0 (19.Cool (0.3)
KOSPI �� 2,003.4 (2.7) (0.1)
TWSE �� 8,038.7 23.6 0.3
Nikkei �� 12,349.1 65.4 0.5
STI Index Performance
Singapore
Total Market cap (US$bn) 616
Total Daily Vol (m shrs) 4,793
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
11 Mar
Target Price
($)
Noble Group Buy 1.180 1.45
Neptune Orient Lines Buy 1.165 1.45
Keppel Corp Buy 11.890 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
11 Mar
Target Price
($)
Ezra Holdings Buy 1.085 1.58
Tat Hong Holdings Buy 1.465 1.80
China Merchants Buy 0.895 1.12
United Envirotech Take profit 0.665 0.65*
Source: Bloomberg Finance L.P, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
SingXpress, which will be renamed SingHaiyi Group, has
proposed a rights issue and share placement to raise up
to $226.5m in net proceeds to finance its venture into the
US property market. SingXpress has planned a
renounceable non-underwritten rights issue of up to
12.92 bn new shares to raise about $193.86m. The rights
issue will be made on the basis of one rights share for
each existing share in the company at an issue price of
1.5 cents per rights share. SingXpress also announced the
placement of 2.2 billion new shares to Acquire Wealth for
$33m at an issue price of 1.5 cents for each placement
share. Acquire Wealth, a British Virgin Islands-based
investment vehicle, is 70% controlled by China national
and Singapore permanent resident, Tang Yigang. The
remaining 30% is owned by New Palace Developments,
whose ultimate shareholders are Neil Bush and his wife.
After the share placement is completed, SingXpress will
appoint Mr Bush, who is the brother of former US
president George W Bush, as chairman of the company.
The Singapore Tourism Board (STB) is expecting tourism
receipts of S$23.5b - S$24.5b in 2013, while visitor
arrivals is expected to be in the range of 14.8m - 15.5m.
This target represents a growth of c2.5%-6.5% for
tourism receipts and 2.7-7.6% Y-o-Y growth for visitor
arrivals. Year 2012 saw Singapore recording S$23b in
tourism receipts and achieving a 14.4m visitor arrivals, in
line with previous forecasts. A higher 14.8m-15.5m visitor
target will also mean that our local hotels will continue to
see brisk business and each is expected to have a fair
share of the enlarged pie, despite increased competition
from an expected to increase of c4,200 rooms ( or 8% of
total rooms in Singapore) over 2012-2013. We have
forecasted occupancy to remain fairly stable at c85%,
RevPAR to grow by 3% in 2013. Apart from pure visitor
arrival growth expectations, the STB will initiate strategies
to increase the average spend per visitor (or improve
"yield per visitor") to achieve our 2015 target of 17m
visitors and S$30b in tourism receipts.
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PostPosted: Wed Mar 13, 2013 10:52 am    Post subject: Reply with quote

Today’s Focus
• Keppel Corp - No change in forecast despite LOI
termination, support at $11.50
• Midas – Raising TP to $0.60 in anticipation of more
order wins from metro & export segments in coming
months
Keppel Corp (Buy, TP $13) announces that the LOIs to
construct 2 semi-submersibles worth USD1.2bil for Naftogaz
of Ukraine has been terminated. Our analyst sees this as an
isolated case, which is more a result of customer specific issue.
These LOIs are not included in Keppel’s order book of
SGD12.8bil and new order wins of SGD10bil in FY12. Thus,
there is no change in forecast although a knee-jerk reaction to
the news is possible. Keppel remains our preferred pick among
the Singapore rig builders for its lower earnings risk, solid
execution track record, the global yard network and remains a
key beneficiary to ride the tightening rig market. Support level
is 11.70 and if broken firmer at about 11.50.
Midas has won 5 contracts (four awarded by JV Nanjing
Puzhen) to supply aluminium profiles and fabrication parts to
various metro projects in the PRC for delivery in 2013 and
2014. We estimate that Midas can win between Rmb300m-
400m worth of contracts per annum in each of the 4
segments – high speed, metro, rail export and non-rail. There
is also increasing expectations from both the market and
railway equipment players that high-speed rail equipment
orders will be handed out within a few months, post China’s
leadership transition. Our analyst raises Midas TP to $0.6 (1.2x
FY13 P/B) from $0.5 in anticipation of order wins from the
metro and export segments in the coming months while high
speed train orders will be another catalyst.
ARA Asset Management (Hold, TP $1.94), which currently
manages $22.1bil, wants to double AUM over 5 years (or
average $4.4bil/year) through acquisitions and enhancing
existing properties, this according to CEO John Lim. ARA plans
to expand into new markets like Japan, Australia and India, as
well as Southeast Asian countries including Indonesia, Vietnam
and Thailand. It may also expand its logistics assets, this
according to Bloomberg. Our analyst currently assumes AUM
growth of $2bil for 2013.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,450.1 2.8 0.0
S&P �� 1,552.5 (3.7) (0.2)
NASDAQ �� 3,242.3 (10.6) (0.3)
Regional Indices
ST Index �� 3,303.0 10.1 0.3
ST Small Cap �� 558.5 3.1 0.6
Hang Seng �� 22,890.6 (200.2) (0.9)
HSCEI �� 11,292.1 (143.7) (1.3)
HSCCI �� 4,469.4 (46.1) (1.0)
KLCI �� 1,656.5 (1.4) (0.1)
SET �� 1,576.7 (1.0) (0.1)
JCI �� 4,854.3 (20.2) (0.4)
PCOMP �� 6,786.4 (27.5) (0.4)
KOSPI �� 1,993.3 (10.0) (0.5)
TWSE �� 7,994.7 (44.0) (0.5)
Nikkei �� 12,314.8 (34.2) (0.3)
STI Index Performance
Singapore
Total Market cap (US$bn) 614
Total Daily Vol (m shrs) 4,371
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
12 Mar
Target Price
($)
Noble Group Buy 1.18 1.45
Neptune Orient Lines Buy 1.17 1.45
Keppel Corp Buy 11.86 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
12 Mar
Target Price
($)
Ezra Holdings Buy 1.08 1.58
Tat Hong Holdings Buy 1.51 1.80
China Merchants Buy 0.90 1.12
United Envirotech Take profit 0.67 0.65*
Source: Bloomberg Finance L.P, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
US stocks fell modestly yesterday, heading closer to ‘triple
witching’ Friday in a week that is fairly quiet on the
economic data front. Apple shares fell after IDC reported
that Google’s software will power more tablets than
Apple Inc.’s operating system for the first time this year as
smaller and cheaper alternatives to the iPad gain favour
with consumers.
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PostPosted: Thu Mar 14, 2013 10:16 am    Post subject: Reply with quote

Today’s Focus
• Ezion - Raised FY13/14F net profit by 15%/6%; maintain
BUY for its high earnings visibility and undemanding
valuations
Our analyst has raised FY13/14F headline net profit for Ezion
by 15%/6% for 1) the latest liftboat charter, 2) the marine
supply base, and 3) disposal of its OMSA JV stake and the
subsequent reduction in charter rates to OMSA. The new
liftboat charter and marine supply base adds to Ezion’s
recurring earnings stream. However, the higher earnings are
partially offset by the dilution effect from placement; FY13/14
EPS adjusted by -5%/+1%. Maintain BUY on Ezion for its high
earnings visibility and undemanding valuations of 13x/8x
FY13/14 PE, against a solid FY12-14 EPS CAGR of 65%. Target
price adjusted to S$2.38 (prev S$2.40).
We have upgraded Singapore Land to BUY with TP raised to
S$9.53 (Prev S$ 6.99). We believe Singland has significant
hidden value through its 53.06% stake in unlisted Marina
Centre Holdings, in addition to its large portfolio of 2.1msf of
directly owned centrally located and suburban office space.
The group has also increased its landbank and now has
788,364sf residential GFA in Singapore, to be developed over
the next few years. We anticipate these growth engines to
continue to be ramped up in the coming years.
IHH’s JV has successfully won the bid for the acquisition of a
site at Wong Chuk Hang, Hong Kong, to be developed for
private hospital use. The capital investment of RM2bn (incl
land cost of RM675m) will be funded by internal generated
funds, and bank borrowings. The hospital will have 500 beds
and is expected to commence operations by Jan 2017. This
latest development reaffirms the longer growth prospects for
the Group.
United Envirotech has signed an agreement with the Jiangsu
government to invest RMB200m (S$46m) in TOT/BOT projects
in textile industrial wastewater treatment, recycling and water
supply. The agreement is for a 30 year concession right to
operate a textile and mixed industrial wastewater treatment
plant with capacities of 40,000 m3/day for Phase 1 and
80,000 m3/day for phase 2. As United Envirotech has achieved
almost 80% of our new TOT (transfer-operate-transfer)
projections, any substantial acquisitions from hereon would
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,455.3 5.2 0.0
S&P �� 1,554.5 2.0 0.1
NASDAQ �� 3,245.1 2.8 0.1
Regional Indices
ST Index �� 3,288.5 (14.5) (0.4)
ST Small Cap �� 556.3 (2.2) (0.4)
Hang Seng �� 22,556.7 (333.9) (1.5)
HSCEI �� 11,037.4 (254.7) (2.3)
HSCCI �� 4,362.9 (106.5) (2.4)
KLCI �� 1,646.2 (10.3) (0.6)
SET �� 1,578.7 2.0 0.1
JCI �� 4,835.4 (18.9) (0.4)
PCOMP �� 6,776.6 (9.9) (0.1)
KOSPI �� 1,999.7 6.4 0.3
TWSE �� 7,995.5 0.8 0.0
Nikkei �� 12,239.7 (75.1) (0.6)
STI Index Performance
Singapore
Total Market cap (US$bn) 616
Total Daily Vol (m shrs) 5,654
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
13 Mar
Target Price
($)
Noble Group Buy 1.170 1.45
Neptune Orient Lines Buy 1.150 1.45
Keppel Corp Buy 11.73 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
13 Mar
Target Price
($)
Ezra Holdings Buy 1.070 1.58
Tat Hong Holdings Buy 1.480 1.80
China Merchants Buy 0.880 1.12
United Envirotech Take profit 0.675 0.65*
Source: Bloomberg Finance L.P, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
pose upside to our forecast. No change to estimates and
fundamental TP of 74cts. Technically, any near-term
bounces should be capped at $0.70-0.72 immediate
resistance.
Koyo International has recently been awarded two
mechanical and electrical (M&E) engineering contracts
with an aggregate contract value of approximately
S$23.7m. Its current order book stood at approximately
S$30.5m.
In the most recent COE bidding, COE premiums fell across
the board, with the most significant drop in the Category
B (>1600 cc) and the Category E (open) segments. The
sharp decline in COE premiums came on the back of the
recently re-introduced financing curbs on vehicle loans.
The drop in COE premiums will have an impact on
inflation readings in the coming months. The hikes in
taxes that were introduced recently will drive private
transportation cost higher whereas the fall in COE
premiums will bring it down. Our economist’s assessment
is that there could be downside surprise on the CPI
inflation in the coming months as the effects of the loan
curbs will likely override that of the tax hikes. This could
pose risk to our inflation forecast of 4.0% for the year.
In property news, 43 commercial strata units in Singapore
Shopping Centre are up in the market for a collective sale.
The shop and office spaces, measuring 22,980 square
feet in all, were put up via an expression of interest that
closes on April 16. The vendor is looking for offers in the
region of $38m or $1,650 psf. The 43 units in the sevenstorey
development, which has 34 years left on its 99-year
lease, constitute 22.6% of the building's total strata area
and will give the buyer 19.8% of its total share value.
US stocks ended marginally higher, helped by better-thanexpected
February retails sales (actual 1.1%, consensus
0.5%). Our economist thinks the initial jobless claims due
out today should show the same improvement while
Friday’s February CPI (consensus 1.9% y-o-y) should
indicate the FED has plenty of room to continue QE3.
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PostPosted: Fri Mar 15, 2013 9:48 am    Post subject: Reply with quote

Today’s Focus
• UOB Group of Companies - Looking across the board.
BUY SingLand, UOL; upgraded UIC to HOLD, maintain
HOLD on UOB
Lower-than-expected weekly initial jobless claims (actual 332k,
consensus 350k) lifted US equities higher yesterday. This,
coupled with an anticipated tame February CPI (consensus
1.9% y-o-y) should underpin equities heading into the
weekend.
Following our re-assessment of the value of Singapore Land
which led to a consequent upgrade of RNAV and target prices,
our valuation for UIC and UOL have also been raised by up to
10% on upstreaming the positive knock-on impact. UOL owns
79.96% of Singland while UOL in turn holds 43.4% of UIC.
Whilst UOB should also enjoy positive accretion from its
holdings of these companies, directly and indirectly, the impact
is a relatively small 3%, given the significant size of its core
banking business. We have a BUY call on SingLand (TP: S$
9.53) and UOL (TP: S$7.77 (Prev S$ 7.03)); upgraded UIC to
HOLD with a TP of $3.00 (Prev S$ 2.21) and maintain HOLD on
UOB (TP: S$20.10).
We believe there are more potential catalysts in the works. The
key catalyst, in our view, to a realization of the underlying
value of this chain of companies, is if Singland is privatized,
which in turn could mean a removal of the ascribed discount
to Singland’s TP and valuing its assets as directly held
properties at UIC level. In this instance, on a best scenario
basis, this translates to a 35% upside to UIC’s valuation, which
in turn would mean a further 9% boost to UOL’s TP.
Singland’s TP, premised on an average 30% discount to asset
backing of $13.61, implies a further 9% upside from here.
However, we believe this would likely be more a medium to
long term development.
Ezra has secured a contract worth US$165m from Det norske -
a key exploration and drilling operator on the Norwegian
Continental Shelf. The contract represents Ezra's first major
rigid pipe-lay project win in the North Sea region and extends
its capabilities in that region. Ezra also secured a contract from
Statoil for the transport and installation of subsea templates
for the Norwegian Sea’s deepest offshore project – the Aasta
Hansteen field development. The contract value for the latter
project is unspecified. This is the 3rd project win from Statoil.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,539.1 83.9 0.6
S&P �� 1,563.2 8.7 0.6
NASDAQ �� 3,258.9 13.8 0.4
Regional Indices
ST Index �� 3,279.5 (9.0) (0.3)
ST Small Cap �� 559.9 3.6 0.6
Hang Seng �� 22,619.2 62.5 0.3
HSCEI �� 11,102.0 64.5 0.6
HSCCI �� 4,380.5 17.6 0.4
KLCI �� 1,640.7 (5.5) (0.3)
SET �� 1,586.8 8.1 0.5
JCI �� 4,786.4 (49.1) (1.0)
PCOMP �� 6,694.7 (81.9) (1.2)
KOSPI �� 2,002.1 2.4 0.1
TWSE �� 7,951.8 (43.Cool (0.5)
Nikkei �� 12,381.2 141.5 1.2
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 613
Total Daily Vol (m shrs) 6,246
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
14 Mar
Target Price
($)
Noble Group Buy 1.175 1.45
Neptune Orient Lines Buy 1.150 1.45
Keppel Corp Buy 11.660 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
14 Mar
Target Price
($)
Ezra Holdings Buy 1.070 1.58
Tat Hong Holdings Buy 1.495 1.80
China Merchants Buy 0.875 1.12
United Envirotech Take profit 0.675 0.65*
Source: Bloomberg Finance L.P, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
With this contract, we estimate Ezra has secured more than
US$600m of subsea work YTD in FY13 (Aug YE) vs. our fullyear
assumption of US$1bn, and current backlog in the
subsea services division should stand at over US$1bn. Subsea
order win momentum has continued to build well in recent
months and the addition of two more subsea vessels in
March and August will further position Ezra to ride on the
surging subsea activity levels. Maintain BUY on Ezra, TP
S$1.58.
STX OSV Holdings will remain listed on the mainboard of
the Singapore Exchange after Fincantieri Oil & Gas failed
to accumulate more than 55.63% of its shares when the
offer period closed on March 13. Fincantieri, the Italian
state-owned shipbuilder, mounted a bid for STX Group's
50.75% interest in STX OSV last December at $1.22 a
share, or $730.6m.
ISDN Holdings is placing 36m new shares at an issue price
of S$0.24 per share. The placement price represents a
discount of approximately 9.98% to last weighted
average price. The estimated net proceeds of S$8.4m will
be used to supplement the working capital requirements,
in particular that of the business segments that the Group
has embarked on in recent years such as the hydroponics
and mining related businesses.
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PostPosted: Mon Mar 18, 2013 10:10 am    Post subject: Reply with quote

Today’s Focus
• Singapore’s NODX fell 30.6% y-o-y in February due to
sharp decline in both electronics and non-electronics
shipments
Asian markets are starting the week on a down beat note in
reaction to Cyprus imposing a deposit levy in a bid by their
govt to raise the €5.8bil funds demanded by Euro-area finance
ministers. On Saturday, the EU unveiled a €10bil plan to rescue
Cyprus' banking sector and avoid a default. But as part of the
bailout, the EU wants a one-time 9.9% tax on deposits of
more than €100,000 starting Tuesday. As a result, Cyprus
people are rushing to withdraw their money from the banks.
Although Cyprus contributes just less than 0.5% of EZ
economy, the deposit levy is a first among troubled Euro-zone
nations that rekindles EZ worries. STI is likely to react in the
current session in tandem. Otherwise, over the mid-longer
term, we continue to see it heading to 3600.
Index adjustment and portfolio rebalancing were possible
causes of the last minute sell-down in numerous stocks last
Friday. Property stocks CityDev, Capitaland, Guoccoland and
HK Land were among those affected. If so, these stocks should
rebound this week because such events are one-off, even as
policy risk concerns continue to weigh on the sector. Nearterm
bounce for Capitaland should lift it towards $3.57 while
that for CityDev is seen at $11.20.
Singapore's key non-oil exports fell 30.6% y-o-y in February,
after rising 0.4% in January, and lower than market consensus
of 17.7% contraction, due to a sharp decline in both
electronics and non-electronics shipments to all its major
destinations. Compared with the previous month, exports
unexpectedly fell 2.4% in seasonally adjusted terms, after
contracting 1.8% m-o-m in January. The market had projected
a 4.5% rise in February. Electronics exports declined 27.4% yo-
y, after falling 5.6% in January, while non-electronics
shipments fell 32.0%, compared with a 3.7% rise in the
previous month. Pharmaceutical exports fell 56.5%, after
falling 22.9% in the previous month. Shipments to the
European Union, its biggest export destination, fell 52.2% y-oy
in February, compared with a 18.4% fall in the previous
month. Exports to the US fell 52.1% y-o-y after falling 14.1%
in January. Exports to China fell 10.6% after the previous
month's 17.8% increase.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,514.1 (25.0) (0.2)
S&P �� 1,560.7 (2.5) (0.2)
NASDAQ �� 3,249.1 (9.9) (0.3)
Regional Indices
ST Index �� 3,286.1 6.6 0.2
ST Small Cap �� 563.8 3.9 0.7
Hang Seng �� 22,533.1 (86.1) (0.4)
HSCEI �� 11,020.9 (81.1) (0.7)
HSCCI �� 4,338.5 (42.0) (1.0)
KLCI �� 1,627.6 (13.1) (0.Cool
SET �� 1,598.1 11.3 0.7
JCI �� 4,819.3 33.0 0.7
PCOMP �� 6,654.6 (40.1) (0.6)
KOSPI �� 1,986.5 (15.6) (0.Cool
TWSE �� 7,927.5 (24.3) (0.3)
Nikkei �� 12,561.0 179.8 1.5
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 615
Total Daily Vol (m shrs) 7,532
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
15 Mar
Target Price
($)
Noble Group Buy 1.190 1.45
Neptune Orient Lines Buy 1.170 1.45
Keppel Corp Buy 11.800 13.00
Stock Picks – Small /Mid Cap
Rec’n Price ($)
15 Mar
Target Price
($)
Ezra Holdings Buy 1.130 1.58
Tat Hong Holdings Buy 1.505 1.80
China Merchants Buy 0.890 1.12
United Envirotech Take profit 0.710 0.65*
Source: Bloomberg Finance L.P, DBS Vickers
* technical target
Singapore
Wired Daily
Page 2
Sembcorp Marine has secured orders for two jack-up rigs
worth US$417m. The orders are from Mexico's Oro
Negro, which has ordered two similar rigs previously. The
new rigs are scheduled for delivery at the end of the
fourth quarter of 2014 and end of the first quarter 2015.
SIA said it flew a total of 1.42m passengers last month, a
5.1% increase from 1.35m passengers a year ago. A
5.1% hike in passenger carriage and 2.4% improvement
in capacity resulted in passenger load factor (PLF)
improving 2.1 percentage points to 78.2%, from 76.1%
in February last year. SIA said it benefited from the
Chinese New Year holidays, which took place in mid-
February, and PLF improved across all routes except for
South West Pacific, which declined 1.4 percentage points
to 82.1% as growth in passenger carriage was outpaced
by capacity increases. PLF for the Americas posted the
most significant growth, up 4.3 percentage points to
77.6% from 73.3% a year ago. On a year-on-year basis,
PLF for West Africa and Africa saw the slightest
improvement, up 0.7 percentage point to 71.3% from
70.6%. On the SIA cargo front, load factor was 62.7%,
up 0.8 percentage points from 61.9% a year ago.
Boustead Singapore has entered into a joint venture
agreement that will lead to the undertaking of a $75m
solar power project in Japan. The joint venture vehicle,
Kinnon Green, owns the rights to a 20 megawatt solar
photo voltaic power generation portfolio in Kyushu,
Japan. The investment will be financed by a mixture of
equity and long-term bank loans.
SingTel is conducting a strategic review of the Optus
Satellite business to optimise value for shareholders.
SingTel will make an appropriate announcement in the
event of any material development arising from the
review.
After a strong showing in January, the private residential
market took a beating last month, as both homebuyers
and developers took pause amid a double whammy of
new cooling measures and a traditional lull period during
Chinese New Year. New private-home sales in February,
excluding Executive Condominiums (ECs), fell to 708
units, down 65% from the 2,016 units sold in January.
This was the lowest volume since December 2011.
Developers also held back launches, offering just 261
units - the fewest since January 2009. This was 86%
lower than the 1,802 units in January 2013. Mass-market
residences continued to drive sales, with 341 units sold
located in the Outside Central Region (OCR). Another 198
units were from the Core Central Region (CCR), with the
remaining 169 units from the Rest of Central Region
(RCR).
Retail sales fell 2% y-o-y in January, vs market expectation
of a 0.1% contraction, due mainly to sharply lower retail
sales from food and beverage outlets and department
stores. This was a result of the Chinese New Year holidays
occurring in January 2012, compared to February this
year. Retail sales of supermarkets, apparel and footwear,
recreational goods, telecommunications products and
computers, watches and jewellery and provision and
sundry shops registered yearly declines of between 3.2%
and 8.7%. In contrast, retailers of motor vehicles
recorded a 10.5% increase in sales, while furniture and
household equipment retailers reported a 6.8% sales
growth.
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PostPosted: Tue Mar 19, 2013 10:11 am    Post subject: Reply with quote

Today’s Focus
• Goodpack - Recent price weakness is a buying
opportunity; upgrade to BUY with TP unchanged at
S$1.95
Asia markets are on the rebound this morning. Investors
recognizing that despite the deposit levy that rattles
confidence among the peripheral Eurozone banks, Cyprus
contributes only a small percentage to the EZ economy. The
move on deposit levy is likely one-off and will unlikely be
replicated by other troubled EZ countries. Across to the US, the
FOMC meeting tomorrow is likely to see the FED keeping
policies unchanged.
Goodpack should see stronger growth from 4QFY13 (FYE
June) with new contracts from the Russian market and
Lanxess’ new plant in Singapore. Momentum should continue
into FY14 with the pickup in rubber trade volume on the back
of pent up demand in the replacement tyre market, which
constitutes c.53% of total rubber demand, following 20
months of weakness. In addition, cost savings from the
global tender exercise will help to improve net margins by an
estimated 1ppt. We expect these to fuel FY14/15F net profit
growth of 25%/16%. The recent price weakness is a buying
opportunity. Upgrade to BUY; TP unchanged at S$1.95.
Yoma announced three investments totalling US$14.55m to
expand its hospitality business from Yangon to Bagan to
capitalise on the current tourism boom in Myanmar. These
include acquisition of 75% stake in SLTG, the only hot air
balloon operator in Bagan that operates “Ballons over Bagan”
(BoB) in Bagan in the last 14 years for US$10.7m; acquisition
of 75% interests in 21.16 acres of land in Bagan for US$3.5m
to construct and operate a hotel business and acquisition of
75% stake in luxury tour operator Eastern Safaris for
US$0.1m. These acquisitions are positive to profits on
completion, but it is now too early to ascertain change to
RNAV-based TP of S$0.80. Technically, the near-term
resistance is strong at $0.82 or just slightly above.
Rickmers Maritime is undertaking a non-underwritten
renounceable rights issue to raise gross proceeds of up to
approximately S$101.7m. The Rights Issue will be offered on a
1-for-1 basis at an issue price of S$0.240 per unit. This
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,452.1 (62.1) (0.4)
S&P �� 1,552.1 (8.6) (0.6)
NASDAQ �� 3,237.6 (11.5) (0.4)
Regional Indices
ST Index �� 3,256.5 (29.6) (0.9)
ST Small Cap �� 560.8 (3.0) (0.5)
Hang Seng �� 22,083.4 (449.Cool (2.0)
HSCEI �� 10,794.7 (226.2) (2.1)
HSCCI �� 4,289.9 (48.6) (1.1)
KLCI �� 1,621.4 (6.3) (0.4)
SET �� 1,591.7 (6.5) (0.4)
JCI �� 4,802.8 (16.5) (0.3)
PCOMP �� 6,536.2 (118.4) (1.Cool
KOSPI �� 1,968.2 (18.3) (0.9)
TWSE �� 7,811.3 (116.2) (1.5)
Nikkei �� 12,220.6 (340.3) (2.7)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 614
Total Daily Vol (m shrs) 3,052
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
18 Mar
Target Price
($)
Noble Group Buy 1.185 1.45
Neptune Orient Lines Buy 1.160 1.45
Keppel Corp Buy 11.620 13.00
SPH Buy 4.490 4.79
Stock Picks – Small /Mid Cap
Rec’n Price ($)
18 Mar
Target Price
($)
Ezra Holdings Buy 1.100 1.58
Tat Hong Holdings Buy 1.500 1.80
China Merchants Buy 0.885 1.12
Kreuz Holdings Buy 0.435 0.58
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
represents a discount of 33.3% to the last closing price. The
proceeds will be used for repayment of bank loans to
improve financial flexibility and strengthen balance sheet.
Yongnam plans to diversify into investing in infrastructural
developments. The structural steelworks provider said it
intends to consider joint ventures with partners with the
relevant expertise of infrastructural developments in
Singapore and overseas. The proposed business
diversification will leverage on the group's existing
business in the provision of structural steelworks,
specialist civil engineering and mechanical engineering
services, and enable the group to develop new revenue
streams, expand its business and improve its growth
prospects.
World Precision Machinery has won a tender to design,
manufacture, deliver and commission high-end stamping
machines for Chongqing Baosteel Meiwei Wheel, the
automobile spare parts division of the world’s second
largest steel producer, Baosteel Group. The total value of
the order is RMB20.8m and the equipment
manufacturing and installation will be completed in the
third quarter of 2013.
Homegrown building construction group, Keong Hong
Holdings has won a S$101m contract to construct a 19-
storey hotel mixed development, comprising a 13-storey
hotel tower and a 6-storey podium. Keong Hong’s current
gross order book based on secured contracts stands at
approximately S$550m, with projects stretching up to
2016.
Willas-Array Electronics intends to seek a dual primary
listing of its shares on the main board of The Stock
Exchange of Hong Kong.
Catalist-listed Sysma Holdings is proposing a
renounceable non-underwritten Rights Issue of up to 95m
new shares at an issue price of S$0.17 for each Rights
Share on the basis of one Rights Share for every one
existing share held. The issue price of S$0.17 represents a
discount of approximately 39.3% to the last closing price.
The estimated net proceed is expected to be
approximately S$16m, and will be used for property
development business and general working capital
purposes.
In property news, Lam Soon Industrial Building, sitting on
a freehold residential site in Hillview Avenue, has been
relaunched for collective sale by Colliers International. The
10-storey building comprises 154 warehouses and light
industrial factories. The site measures 230,915 sq ft and
has a gross plot ratio of 1.92. The site can be redeveloped
into a 10-storey residential building comprising 403 units
of 1,100 sq ft each. Notwithstanding its current function
as an industrial site, the plot is zoned for residential use.
The Lam Soon site was launched last May, but the sale
was not completed because the owner's price
expectations were not met. It had an indicative pricing of
$330m, or $925 psf per plot ratio.
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PostPosted: Wed Mar 20, 2013 11:34 am    Post subject: Reply with quote

Today’s Focus
• Midas – Won €22.7m overseas contract; maintain BUY,
TP S$0.60
News of the better-than-expected US February housing starts
(actual 917k, consensus 915k) and building permits (actual
946k, consensus 925k) is offset by that of the Cypriot
parliament voting to reject the deposit levy. This caused the
near-term uncertainty that raises the question of who’s going
to foot the bill, although Germany’s finance minister is quick
to comment that what happens in Cyprus stays within Cyprus.
The indicators to watch are the Italian and Spanish
government bond yields, which although lifted by a minor
bounce off recent low, has not shown any big up surge.
Meanwhile, technically, the Euro-USD, having retreated from a
high of 1.37 beginning February to the current1.287 is also
approaching support at 1.27-1.28 that should halt the current
slide should it weaken a little further.
The outcome of the FOMC meeting will be decided tomorrow
with the FED expected to keep interest rates and policy
outlook unchanged.
The March HSBC Flash Manufacturing PMI for China will also
be released tomorrow (consensus 50.Cool.The data should give
investors an indication of whether the decline in the February
figure to 50.4 is due to the Lunar New Year effect and if
things should return to ‘norm’ going forward. Technically, we
maintain our view that SSEC’s pullback from 2445 that started
in mid-February is a ‘healthy’ correction to consolidate the
gains achieved in the Dec12-Feb13 rally. The index has tested
the important support at 2250 that we noted earlier. Post
correction, we expect the SSEC to resume its rising trend
towards 2700 in coming months.
Midas has won a €22.7m (approximately RMB182.8m)
contract from Ural Locomotives, a joint-venture company
between Siemens and Russia’s Sinara Group. Midas will supply
aluminium alloy extrusion profiles for use in the manufacture
of 100 electric train sets (1 train set = 5 train cars), or 500
electric train cars for commuter passenger service. Delivery for
the contract is slated to take place progressively from 2013 to
2019. This is a fairly significant win for Midas in the export
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,455.8 3.8 0.0
S&P �� 1,548.3 (3.Cool (0.2)
NASDAQ �� 3,229.1 (8.5) (0.3)
Regional Indices
ST Index �� 3,269.1 12.7 0.4
ST Small Cap �� 562.9 2.0 0.4
Hang Seng �� 22,041.9 (41.5) (0.2)
HSCEI �� 10,740.1 (54.7) (0.5)
HSCCI �� 4,300.0 10.1 0.2
KLCI �� 1,625.5 4.1 0.3
SET �� 1,568.3 (23.4) (1.5)
JCI �� 4,822.6 19.8 0.4
PCOMP �� 6,426.3 (109.9) (1.7)
KOSPI �� 1,978.6 10.4 0.5
TWSE �� 7,838.5 27.1 0.3
Nikkei �� 12,468.2 247.6 2.0
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) 609
Total Daily Vol (m shrs) 3,134
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
19 Mar
Target Price
($)
Noble Group Buy 1.180 1.45
Neptune Orient Lines Buy 1.165 1.45
Keppel Corp Buy 11.57 13.00
SPH Buy 4.510 4.79
Stock Picks – Small /Mid Cap
Rec’n Price ($)
19 Mar
Target Price
($)
Ezra Holdings Buy 1.11 1.58
Tat Hong Holdings Buy 1.525 1.80
China Merchants Buy 0.885 1.12
Kreuz Holdings Buy 0.44 0.58
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
market, which shows their capability to win contracts outside
of China. As deliveries are spread over 7 years from 2013 to
2019, the annual contribution of this contract to the top line
is relatively small at c. RMB25m but nonetheless grows the
Group's order book to c. RMB700m, compared to just
RMB400m at the end of Feb. This is the second significant
supply contract won this month, with the first being a c.
RMB110m contract to supply 5 metro train projects in China.
Maintain BUY and TP S$0.60.
Super Group announced that Mdm Te Lay Guat (sister-in-law
of the Chairman) has resigned as executive director of the
company to pursue her personal interests. This should not
have a significant impact to earnings as the Chairman and
other key founding directors in the business units continue to
remain intact. Hence we expect Super Group’s strategy and
execution to remain stable.
ST Engineering has injected its pro rata share of an
additional US$4.05m (S$5.01m) into the capital of its
50%-owned associated company, Total Engines Asset
Management (TEAM). With this new injection, it will bring
its total share capital contribution in TEAM to US$8.21m
(S$10.15m). This additional funding will support the
expansion of the engine leasing business.
China Aviation Oil has been awarded contracts to supply
aviation fuel to Air China and three international airports -
Madrid International Airport, Los Angeles International
Airport and London Heathrow Airport. The term of each
of these supply contracts is 18 months commencing from
1 April 2013. The aggregate contractual volume for the
expected term is approximately 120,000 metric tonnes.
This is another milestone in the Group’s expansion of its
aviation fuel marketing business. Aviation fuel supply
volume jumped 36 times over 2011 to 750,000 tonnes in
2012.
UE E&C has been awarded the tender for the proposed
renovation for Arts and Crafts Centre at Jalan Residency,
Bandar Seri Begawan, Negara Brunei Darussalam at the
tender price of approximately BND23.2m. The project
period is for 12 months and is to be completed in two
phases by 31 August 2013 and 31 March 2014
respectively.
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PostPosted: Thu Mar 21, 2013 9:44 am    Post subject: Reply with quote

Today’s Focus
• Sound Global - Cheapest water stock; attractive M&A
target. Maintain BUY, TP lowered to S$0.81
US markets rose following Asia’s rise yesterday and after the
FED signalled continued bond purchases. The FED said it will
continue to purchase $85bn of bonds/mth and reiterated that
it will do so “until the outlook for the labour has improved
substantially”. It added that short-term policy rates (Fed funds)
will remain near zero for “at least as long as the
unemployment rate remains above 6.5%” and inflation
expectations stay well behaved. FED Chairman Ben Bernanke
later stressed that QE3 was not an all-or-nothing program and
that the pace of bond purchases could be varied as and when
the data improves.
Key data today is China’s HSBC March flash manufacturing
PMI scheduled for release at 9:45am. Consensus expects a
reading of 50.8, a mild improvement over February’s number
of 50.4. Investors will be watching whether the March figure
can further improve from February as the prior month
coincided with the Lunar New Year holiday.
Sound Global was sold down after its weak 4Q12 results, CFO
departure and the ensuing management shuffle. The stock is
now trading at 9x FY13F PE or –1SD of its historical mean. It is
the cheapest water stock in the region, trading at >40%
discount to peers’ average of 15x PE. Our analyst has adjusted
FY13/14F earnings by -5%/+12% respectively to conservatively
phase out project recognition schedule. Maintain BUY, target
price lowered to S$0.81 (Prev S$ 0.89), but there is still 62%
potential upside. Surging interest expense and delayed
execution are key risks; Sound Global’s depressed valuations
could draw privatization interest, in our view.
Ezion has secured a charter contract worth US$48.2m over
three years to provide a service rig for an international oil
company in the Arabian Gulf region. This is Ezion’s 4th
liftboat/service rig contract YTD in FY13 and adds on to its
recurring earnings stream. This contract should boost FY14 EPS
by about 3.5%. With a fortified balance sheet – following the
recent issue of new shares and the divestment of its stake in
the OMSA JV – and a robust pipeline of potential projects, we
US Indices Last Close Pts Chg % Chg
Dow Jones �� 14,511.7 55.9 0.4
S&P �� 1,558.7 10.4 0.7
NASDAQ �� 3,254.2 25.1 0.8
Regional Indices
ST Index �� 3,248.4 (20.7) (0.6)
ST Small Cap �� 567.6 4.8 0.8
Hang Seng �� 22,256.4 214.6 1.0
HSCEI �� 10,978.8 238.7 2.2
HSCCI �� 4,387.2 87.2 2.0
KLCI �� 1,631.5 6.1 0.4
SET �� 1,543.7 (24.6) (1.6)
JCI �� 4,831.5 8.9 0.2
PCOMP �� 6,419.6 (6.6) (0.1)
KOSPI �� 1,959.4 (19.1) (1.0)
TWSE �� 7,798.0 (40.4) (0.5)
Nikkei �� 12,468.2 247.6 2.0
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 612
Total Daily Vol (m shrs) 3,542
12m ST Index High 3,309
12m ST Index Low 2,699
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
20 Mar
Target Price
($)
Noble Group Buy 1.170 1.45
Neptune Orient Lines Buy 1.175 1.45
Keppel Corp Buy 11.440 13.00
SPH Buy 4.410 4.79
Stock Picks – Small /Mid Cap
Rec’n Price ($)
20 Mar
Target Price
($)
Ezra Holdings Buy 1.120 1.58
Tat Hong Holdings Buy 1.540 1.80
China Merchants Buy 0.880 1.12
Kreuz Holdings Buy 0.455 0.58
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
believe Ezion will continue to grow its project backlog and
earnings stream. Maintain BUY with higher TP of S$2.42
(Prev S$ 2.3Cool for its high earnings visibility and undemanding
valuations.
Mermaid Maritime proposes to undertake a nonrenounceable
non-underwritten rights issue of new shares
and a private placement of such number of new shares,
which would be equivalent to the remaining unsubscribed
excess Rights Shares, to raise gross proceeds of approximately
S$176.1m. Up to 628.8m Rights Shares will be offered at an
issue price of S$0.280 for each Rights Share on the basis of
four Rights Shares for every five existing shares held. The
proceeds will be used for repayment of existing loan facilities,
initial payment and other related expenses for construction of
two new rigs and general working capital.
STATS ChipPAC said holders of its outstanding
US$241.6m of 7.5% senior notes due 2015 can now
exercise the option to redeem them on April 19, 2013.
According to the contract terms, the redemption price for
the notes will be 105.848% of the principal amount and
accrued and unpaid interest, if any. The company will
cancel the notes on redemption.
Ntegrator International is proposing a bonus issue of up
to 353.3m free bonus warrants, on the basis of one (1)
Warrant for every two (2) existing shares, each Warrant
carrying the right to subscribe for one (1) new share at an
exercise price of S$0.02 for each New Share. The Exercise
Price of S$0.02 for each New Share represents a discount
of approximately 78.0% to the last traded price.
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