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DBS Vickers Reports Sept 2013
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Posts: 1350

PostPosted: Fri Sep 20, 2013 9:06 am    Post subject: Reply with quote

Today’s Focus
�� F&N – Value uncapped; upgrade to BUY, target price
revised to S$6.50
DBSV research upgrades F&N to BUY, as shareholders’
value is unlocked through dividend-in-specie of its
property unit, Frasers Centrepoint Limited (FCL). Its JV
partner in Myanmar Brewery Limited (MBL) has issued a
notice of arbitration on FNN’s 55% stake. The outcome is
unknown at this stage, but we believe in the worst case
scenario, impact on RNAV is low, at 2.5%. Stripping out
the estimated value of F&B, we estimate that FCL is
trading at a steep 47%/27% discount to RNAV and book
value, higher than the property sector’s average of 31%
and c.5%, despite FCL’s established position. We revised
our TP to S$6.50 (Prev S$9.52), after incorporating the
recent capital distribution (S$3.28/share).
SIA has unveiled plans with India's Tata group again to set
up a joint-venture airline in that country. SIA said it had
signed a Memorandum of Understanding with Tata Sons
and applied for Foreign Investment Promotion Board (FIPB)
approval to establish a new full-service airline in India.
Total initial investment will be US$100m, with Tata Sons
owning 51% for its US$51m share and SIA the remaining
49%. SIA and Tata had first tried - and failed - to start up
their joint-venture airline in India back in 1994.
Albedo has agreed to a $774.1m reverse takeover (RTO)
with a company majority owned by Malaysian tycoon Tan
Sri Dato’ Danny Tan that will see Albedo transformed into
a major property developer in Iskandar, Malaysia’s special
economic zone in the southern state of Johor. Seven
parcels of land in Iskandar valued at RM2.7 bn will be
injected into Albedo; two more parcels under
negotiations. The company will focus on property
development and management in Malaysia after the RTO.
Albedo will pay for the acquisition by issuing 34.55 bn
new shares representing about 95% of the enlarged
issued capital of the company at around 2.24 Singapore
cents per share.
ComfortDelGro has incorporated a wholly-owned subsidiary
with an initial paid-up capital of RMB1m in China. The
principal activity of the subsidiary is operation of a driving
school.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 15,636.6 (40.4) (0.3)
S&P �� 1,722.3 (3.2) (0.2)
NASDAQ �� 3,789.4 5.7 0.2
Regional Indices
ST Index �� 3,251.8 57.9 1.8
ST Small Cap �� 580.7 7.1 1.2
Hang Seng �� 23,502.5 385.1 1.7
HSCEI �� 10,769.5 181.5 1.7
HSCCI �� 4,488.1 34.9 0.8
KLCI �� 1,792.9 21.5 1.2
SET �� 1,489.1 49.9 3.5
JCI �� 4,670.7 207.5 4.6
PCOMP �� 6,511.7 177.7 2.8
KOSPI �� 2,005.6 (7.Cool (0.4)
TWSE �� 8,209.2 (40.6) (0.5)
Nikkei �� 14,766.2 260.8 1.8
STI Index Performance
Singapore
Total Market cap (US$bn) 600
Total Daily Vol (m shrs) 5,768
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
19 Sep
Target Price
($)
ST Engineering Buy 4.270 4.80
ComfortDelgro Buy 1.960 2.19
OCBC Bank Buy 10.460 12.40
Spore Airlines Buy 10.470 11.40
Suntec REIT Buy 1.705 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
19 Sep
Target Price
($)
Ezion Holdings Buy 2.400 3.20
Goodpack Buy 1.740 2.00
CSE Global Buy 0.905 1.07
Mapletree Commercial Trust Buy 1.195 1.35
CDL Hospitality Trust Buy 1.620 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
Hiap Tong is proposing to acquire a leasehold industrial
property located at Soon Lee Road Singapore, with an
estimated land area of 26,131 square metres, for S$18m.
The proposed acquisition is for the Group’s operations and
business activities. Its current leasehold property at Pandan
Loop, expiring on 15 January 2014, has been granted a one
year tenancy (from 16 July 2013 to 15 July 2014) from
Jurong Town Corporation.
Hiap Seng Engineering has been awarded two contracts
worth approximately S$57m for the provision of piping and
equipment installation works and the provision of
mechanical, equipment erection and structural works in
Singapore. Both contracts are expected to commence in
September 2013 and scheduled for completion in the
financial year ending 31 March 2015.
In property news, rental demand for homes continued to
strengthen in Q2, driven by a surge in interest in shoebox
units. According to data from Square Foot Research, a total
of 12,352 rental contracts in the non-landed private
residential market were reported in Q2, up 11.6% y-o-y. In
the first six months of this year, a total of 22,937 rental
contracts were signed, a 10.2% rise compared with the
previous year. Rental demand for shoebox units, defined as
units ranging from 300 to 500 sq ft, rose 93% to 748
contracts in H1 2013.
US markets eased, taking a breather from the rise the prior
session triggered by the FED’s decision to postpone cutting
down QE. The 10-yr yield rebound a tat to 2.75% while the
USD Index tapped up slightly to 80.36. Existing home sales
rose 1.7% m-o-m, better than the -2.6% consensus
expectations. The September Philadelphia Fed Business
Outlook also gained a better 22.3 compared to 10.3
consensus expectations.
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PostPosted: Mon Sep 23, 2013 9:07 am    Post subject: Reply with quote

Today’s Focus
 Rex International - Independent E&P player with
potentially revolutionary exploration technology.
Initiate with BUY and S$1.27 TP
US markets fell as political bickering ahead of the need to
raise the country’s debt ceiling picked up, uncertainty about
when the FED will start cutting back QE and heading into
election weekend in Germany. The US 10-year treasury yield
rose to an intra-session high of 2.77% before ending the
week at 2.73%. In Germany, Angela Merkel has won a
landslide personal victory in Germany's general election but
her conservatives appeared just short of the votes needed to
rule on their own and may have to convince leftist rivals to
join a coalition government.
The STI should start the week softer on the back of Friday’s
decline on Wall Street. A pullback to test the immediate
support at 3200 is possible this week. Index valuation
reached 13.9x (ave) 12-mth forward PE last week. With the
uncertainty that follows the deadline to raise the US debt
ceiling and a likely lack luster 3Q results season, STI’s shortterm
rally has likely come to a stall around 3250 last week. A
consolidation band from c.3200-3250 or a pullback to 3200
followed by 3165 is seen in coming weeks/month before
rising again.
We are initiating coverage on Rex International Holding
(RIH) with a BUY call and target price of S$ 1.27. RIH is an
independent E&P player armed with potentially
revolutionary exploration technology. We estimate that
the use of Rex VD could yield success rates in excess of
50%, compared to global average of around 15% using
traditional methods, thus potentially boosting project ROIs
to >100%. RIH has the first mover advantage in “seeing”
oil gives it a head start in cherry picking attractive licences.
It is a potential multi-bagger as it buys assets cheap and
spins off successful discoveries.
Keppel Corp has sold its entire stake in Berich Enterprises
and Keppel Kazakhstan LLP for US$32.5m cash. The
principal activities of Keppel Kazakhstan are the design,
engineering and construction of barges, pontoons, pipe
racks, modules, and drilling units for the oil and gas
industry in the Republic of Kazakhstan.
US Indices Last Close Pts Chg % Chg
Dow Jones  15,451.1 (185.5) (1.2)
S&P  1,709.9 (12.4) (0.7)
NASDAQ  3,774.7 (14.7) (0.4)
Regional Indices
ST Index  3,237.5 (14.3) (0.4)
ST Small Cap  579.1 (1.6) (0.3)
Hang Seng  23,502.5 385.1 1.7
HSCEI  10,769.5 181.5 1.7
HSCCI  4,488.1 34.9 0.8
KLCI  1,801.8 8.9 0.5
SET  1,486.8 (2.3) (0.2)
JCI  4,583.8 (86.9) (1.9)
PCOMP  6,424.5 (87.3) (1.3)
KOSPI  2,005.6 (7.Cool (0.4)
TWSE  8,209.2 (40.6) (0.5)
Nikkei  14,742.4 (23.Cool (0.2)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 595
Total Daily Vol (m shrs) 5,487
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
20 Sep
Target Price
($)
ST Engineering Buy 4.210 4.80
ComfortDelgro Buy 1.960 2.19
OCBC Bank Buy 10.420 12.40
Singapore Airlines Buy 10.440 11.40
Suntec REIT Buy 1.690 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
20 Sep
Target Price
($)
Ezion Holdings Buy 2.380 3.20
Goodpack Buy 1.720 2.00
CSE Global Buy 0.905 1.07
Mapletree Commercial Trust Buy 1.200 1.35
CDL Hospitality Trust Buy 1.630 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
YHM Group has secured a contract with a value of up to
approximately US$183m over a 3-year period with an
additional 2 year extendable option to provide a
semisubmersible rig to be used by a Southeast Asian based
national oil company to support its oil and gas activities in
the Andaman Sea. The company is in the process of forming
a joint venture company to own the Semi. The Semi will be
upgraded and refurbished and is expected to be deployed in
the Andaman Sea between end 2013 and early 2014.
Telcos are reporting an increase in the number of subscribers
busting their data cap. SingTel sees a trend that 4G
customers are using more data on average than 3G users,
about 20-30% increase. Already, SingTel's last-reported
quarter ended June 30, 2013, saw 13% of post-paid
subscribers on tiered plans exceeding their monthly data
limits, up from 10% in the quarter before that. Over at
StarHub, the faster 4G network has been a boon for data
usage, and this trend is expected to continue. There has
been a similar trend at M1. In its last reported quarter, 15%
of its post-paid users on tiered data plans exceeded data
caps - up from 9% the previous quarter.
In property news, UOL Group and Singapore Land move 160
units at Thomson Three on the first day of sales bookings
this week. This was out of the 200 units they released. The
developers plan to release a further 120-150 units this
weekend. Located on Bright Hill Drive, the project comprises
435 apartments and 10 strata semi-detached houses. The
average price of the 99-year leasehold development is about
$1,350 psf. According to UOL, without TDSR (total debt
servicing ratio), it could easily have priced this project at
$1,500 psf on average, or even higher.
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PostPosted: Tue Sep 24, 2013 9:08 am    Post subject: Reply with quote

Today’s Focus
 Silverlake Axis - Offers double-digit growth and 4.5%
yield; maintain BUY with revised TP of S$0.82
 Yangzijiang - Best proxy to shipbuilding recovery;
maintain BUY on higher S$1.32 TP
We maintain BUY call on Silverlake Axis with revised TP of
S$0.82 (Prev S$0.80), implying potential returns of over
18%. Silverlake Axis offers double-digit growth and 4.5%
yield. The backlog of ~RM325m at the end of FY13
provides 12-month visibility. The group is also pursuing
seven deals at the moment; big order win from a
Malaysian bank could be a catalyst.
Yangzijiang Shipbuilding is launching the first 10k TEU
containership on schedule. The on-track construction
progress of Yangzijiang's first large containership is a
confidence booster. We have raised FY14F earnings on
better margins and order wins; FY15F earnings are
expected to benefit from property income. Its investment
segment is well managed. Yangzijiang is the best proxy to
shipbuilding recovery; maintain BUY on higher S$1.32 TP
(Prev S$ 1.02).
Tiger Airways has pulled ahead of the pack, widening the
gap between itself and its competitors, according to a
latest report on the low-cost carrier (LCC) sector by the
Centre for Aviation (CAPA). The group now accounts for
33% of LCC capacity at Changi International Airport -
more than the 26% and 23% LCC capacity share of rivals
AirAsia and Jetstar, respectively. By year-end, Tigerair,
including Tigerair Mandala and Tigerair Philippines, will
account for almost 11% of total seat capacity at Changi,
compared with just under 8% each for Jetstar and
AirAsia, the report said. Tigerair Group attributed the
growth in capacity to its own fleet expansion strategy,
which will see a total of six A320 aircraft being delivered
by year-end.
Global Logistic Properties signs agreement with Vipshop,
a leading e-commerce company, to develop 130,000 sqm
of new built-to-suit facilities in Kunshan, Eastern China.
Construction of the first phase comprising 60,000 sqm
(646,000 sq ft) commenced in August 2013.
US Indices Last Close Pts Chg % Chg
Dow Jones  15,401.4 (49.7) (0.3)
S&P  1,701.8 (8.1) (0.5)
NASDAQ  3,765.3 (9.4) (0.3)
Regional Indices
ST Index  3,214.3 (23.3) (0.7)
ST Small Cap  580.1 1.0 0.2
Hang Seng  23,371.5 (131.0) (0.6)
HSCEI  10,717.7 (51.Cool (0.5)
HSCCI  4,484.5 (3.7) (0.1)
KLCI  1,796.4 (5.5) (0.3)
SET  1,436.7 (50.1) (3.4)
JCI  4,562.9 (21.0) (0.5)
PCOMP  6,477.9 53.5 0.8
KOSPI  2,009.4 3.8 0.2
TWSE  8,292.8 83.6 1.0
Nikkei  14,742.4 (23.Cool (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$bn) 595
Total Daily Vol (m shrs) 4,539
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
23 Sep
Target Price
($)
ST Engineering Buy 4.23 4.80
ComfortDelgro Buy 1.96 2.19
OCBC Bank Buy 10.40 12.40
Singapore Airlines Buy 10.38 11.40
Suntec REIT Buy 1.675 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
23 Sep
Target Price
($)
Ezion Holdings Buy 2.35 3.20
Goodpack Buy 1.725 2.00
CSE Global Buy 0.90 1.07
Mapletree Commercial Trust Buy 1.20 1.35
CDL Hospitality Trust Buy 1.645 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
LionGold Corp has signed an ore processing agreement with
Australian-listed A1 Consolidated Gold in Victoria which may
boost revenues over a three year period. Up to 150,000
tonnes per year of ore from the A1 Gold Mine would be
processed at the nearby Ballarat gold plant, wholly-owned by
LionGold subsidiary, Castlemaine Goldfields. In conjunction
with the agreement, LionGold will subscribe to 34.5m new
A1 shares at A$0.116 per share, representing about 19.9%
of A1’s enlarged share capital, for a consideration of
S$4.7m. A1 will use the total proceeds to advance the
development of its A1 Gold Mine, which is targeted to begin
trial processing at Castlemaine’s Ballarat Mine within the
next six months. In addition to nearly doubling throughput at
the Ballarat plant, the collaboration with A1 represents an
opportunity to consolidate gold operations in southeast
Australia.
Oceanus Group reported that Typhoon Usagi has hit
Guangdong, coastal Zhejiang and Fujian provinces in China
where the majority of its abalone production is sited. The
group is assessing the damages caused.
The Singapore government is tightening the foreign
manpower regime further, with a 10% hike to the minimum
salary required to hire a young foreign professional on an
employment pass (EP) - the category of work passes not
subject to quotas and levies. Also, under new rules to ensure
Singaporeans get fair consideration before foreigners are
hired, employers will have to advertise job vacancies on a
new national jobs bank for two weeks before any
applications for EPs for those professional, managerial and
executive (PME) jobs will be accepted.
Singapore’s consumer price index (CPI) in August rose 2%
from a year ago, picking up from July's increase of 1.9% and
in line with market expectations of 2%. This slight rise was a
result of stronger increases in the costs of accommodation,
food and services - though these were partly offset by a
smaller gain in private road transport costs. Climbing at a
faster pace was the MAS core inflation measure, which
excludes costs of accommodation and private road transport.
This rose to 1.8% in August from 1.6% in July, due to
higher contributions from food and services. Food prices
increased 2.4% last month, up from 2.1% in July, mainly
due to costlier hawker and restaurant meals. Services
inflation picked up to 2.7% in August from 2.5% a month
earlier, driven by a stronger rise in cable TV charges and
tertiary education fees.
The flash HSBC Purchasing Managers' Index (PMI) for China
climbed to 51.2 last month from August's 50.1, hitting a
high not seen since March as stronger domestic and foreign
demand added to recent signs of a tentative turnaround in
the economy. New export orders jumped to a 10-month
peak of 50.8, up sharply from August's 47.2. It was the first
time in 6 months that exports had shown growth in the PMI.
Meanwhile, business activity in the Eurozone also grew
faster-than-expected in September as new orders flood in.
Markit's Flash Composite Purchasing Managers' Index (PMI)
jumped to 52.1 from last month's 51.5, its highest since
June 2011 and beating expectations for 51.9. The pace of
growth in the bloc's dominant services sector beat all
forecasts in a Reuters poll. The PMI came in at 52.1, well
ahead of August's 50.7 and comfortably above median
expectations for a more modest rise to 51.0.
US markets fell with investors still uncertain about the
timetable for QE cut back and as the democrats and
republicans hardened their positions on the stance regarding
the federal budget and borrowing limits. In line with Asian
bourses starting the Tuesday session lower, STI should begin
the current session modestly down but the intra-day
direction looks to be up as the index.
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PostPosted: Wed Sep 25, 2013 9:08 am    Post subject: Reply with quote

Today’s Focus
 REITS dominated equity raising in 3Q
Equity capital raising in Singapore slowed year-on-year in
a volatile third quarter, but real estate investment trusts
helped maintain year-to-date volumes at a five-year
high.3Q ECM (equity capital market) activities were muted
primarily due to the uncertainties in the equity market.
Proceeds raised from priced stock sales, including
convertible deals, in Singapore fell 20% y-o-y to
US$4.4bn in the three months to September, preliminary
data compiled by Thomson Reuters showed. Year-to-date,
equity deals have raised US$14.9 bn in Singapore. Real
estate investment trusts (Reits) have dominated Singapore
equity capital markets so far this year. Reits led the way
during the quarter, with Overseas Union Enterprise raising
US$521m from the spinning off of the OUE Hospitality
Trust and Singapore Press Holdings drawing US$440m for
its SPH Reit. For the nine months ended September, equity
deals from the real estate sector accounted for 39%, or
US$5.8 bn, of the total. On the new listings front, 86%,
or US$2.9 bn, of total year-to-date IPO proceeds were
raised by real estate plays.
EMS Energy has secured from its major shareholder,
Koastal Industries, a contract worth US$36m to build a
Derrick Equipment Set (DES), complete with full drilling
equipment, for an offshore tender assisted drilling rig,
commonly known as tender rig, and expects to secure
two more DES of similar value over the next few months.
EMS will deliver the first DES for the tender rig, over 18
months to Koastal for a China state-owned Shipyard. The
project is the largest that EES has secured to date. With
this first DES project secured, the Group’s order book has
increased to about S$67.8m from S$18.4m as announced
in August 2013.
Geo Energy Resources has entered into a mining services
contract and a coal mining cooperation agreement with
PT Parisma Jaya Abadi (PJA). PJA holds mining business
permits for an area of 5,000 hectares located in East
Kalimantan Province.
ISDN Holdings has acquired 80% stakes in two more
Indonesian hydropower-related businesses for a total of
US$1.9m. The acquisitions, funded by the company's
reserves, are the latest in a string of purchases made by ISDN
to expand in Indonesia's hydropower production sector.
US Indices Last Close Pts Chg % Chg
Dow Jones  15,334.6 (66.Cool (0.4)
S&P  1,697.4 (4.4) (0.3)
NASDAQ  3,768.3 3.0 0.1
Regional Indices
ST Index  3,211.8 (2.5) (0.1)
ST Small Cap  580.1 0.0 0.0
Hang Seng  23,179.0 (192.5) (0.Cool
HSCEI  10,599.2 (118.6) (1.1)
HSCCI  4,434.9 (49.6) (1.1)
KLCI  1,792.5 (3.9) (0.2)
SET  1,417.8 (18.9) (1.3)
JCI  4,460.4 (102.4) (2.2)
PCOMP  6,461.4 (16.6) (0.3)
KOSPI  2,005.0 (2.1) (0.1)
TWSE  8,299.1 6.3 0.1
Nikkei  14,732.6 (9.Cool (0.1)
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 592
Total Daily Vol (m shrs) 5,185
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
24 Sep
Target Price
($)
ST Engineering Buy 4.220 4.80
ComfortDelgro Buy 1.940 2.19
OCBC Bank Buy 10.390 12.40
Singapore Airlines Buy 10.420 11.40
Suntec REIT Buy 1.680 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
24 Sep
Target Price
($)
Ezion Holdings Buy 2.370 3.20
Goodpack Buy 1.710 2.00
CSE Global Buy 0.905 1.07
Mapletree Commercial Trust Buy 1.200 1.35
CDL Hospitality Trust Buy 1.630 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
Avic International Maritime is riding on the wave of China's
shipyard boom, via the strategic acquisition last year of
Deltamarin, which is known for its strengths in innovation
and design capabilities. Two factors have led Avic's rise in
profile among Chinese shipyards: Firstly, it has been able to
take advantage of the lack of in-house structured design
capabilities among Chinese yards to offer customised designs
for individual customers. Secondly, the Avic group, the
parent company of Avic International Maritime, is a Fortune
500, state-owned enterprise in China. This not only entitles it
to strong support from Chinese financial institutions, it also
means it can tap into its network to build its business.
Ley Choon Group has won four contracts amounting to
about $30.6m, raising its order book to $233.4m. Two of
the projects came from PowerGas, the third from JTC and
the last one is a subcontracting contract for supply and
installation of power cables. The group will continue to
leverage growth opportunities afforded by the increase in
public infrastructure projects to expand its business.
CCFH Ltd is placing out 124m new shares at an issue price of
S$0.0333 per share, amounting to S$4.1m. The issue price
represents a discount of approximately 9.98% to the last
volume-weighted average price. The proceeds will be used
for the general and corporate working capital requirements
of the Group.
US stocks fell as the debate among lawmakers continued.
Democrats offered a new proposal to fund the government
through Nov15, which complicates efforts to avoid a
government shutdown in a week. The 10-year treasury yield
dipped to a 6-wk low of 2.66% as investors bet that the FED
will not cut back on QE next month.
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PostPosted: Thu Sep 26, 2013 9:05 am    Post subject: Reply with quote

Today’s Focus
 Soilbuild Business Space REIT – Initiate coverage with
BUY call and target price of S$0.87. Forward yield of
7.7%-8.6% one of the highest amongst the S-REIT
space.
For the STI, an initial dip that probed the 3200 immediate
support earlier this week resulted in a minor 30pt rebound
but that has since been given back. With US hitting its debt
ceiling by 17 Oct, the postponement of QE tapering to a later
date and a likely lack lustre 3Q results season, it is possible
for STI’s current consolidation off the 3200 level to dip lower
to 3175 but not exceeding 3140 where better support
emerges.
We are initiating coverage on Soilbuild Business Space REIT
(SB REIT) with a BUY call and target price of S$0.87. SB REIT
offers exposure into a modern portfolio of business
park/industrial properties in Singapore with a valuation of
S$935m. Compared to existing industrial S-REITs, its portfolio
is the youngest, with an average age of 3.1 years (by GFA),
backed by long land lease tenure of c.51 years. SB REIT will
derive 42-43% of its net property income from master
leases, with tenures ranging from 5-15 years, and this will
offer strong income visibility to the REIT. At a FYP13F-15F
yield of 7.7%-8.6%, SB REIT offers one of the highest yields
amongst the S-REIT space, which is attractive.
Yangzijiang Shipbuilding has launched its first ever 10,000
TEU containership from its Jiangsu New Yangzi Shipbuilding.
This is also the first ever Chinese yard to have secured orders
for the 10,000 TEU containerships. As at current date, the
Group has 11 of such vessels on the order book and also
there are options for 14 more. This reiterates the Group’s
ability to scale up the value chain with securing orders and
building higher capacity eco-friendly vessels.
OUE is considering yet another real estate investment trust
(Reit). The company is "exploring the establishment" of a
commercial Reit to be listed on the main board. OUE said
that the proposed Reit's initial portfolio is expected to include
OUE Bayfront - its 18-storey flagship office building at Collyer
Quay - along with the building's ancillary properties
comprising a tower building used for a food and beverage
outlet and a link bridge with retail shops. Other commercial
properties owned by Lippo China Resources Limited (LCR) are
also being considered for acquisition by the proposed Reit.
US Indices Last Close Pts Chg % Chg
Dow Jones  15,273.3 (61.3) (0.4)
S&P  1,692.8 (4.7) (0.3)
NASDAQ  3,761.1 (7.2) (0.2)
Regional Indices
ST Index  3,208.6 (3.2) (0.1)
ST Small Cap  582.0 1.9 0.3
Hang Seng  23,209.6 30.6 0.1
HSCEI  10,598.2 (1.0) (0.0)
HSCCI  4,436.3 1.4 0.0
KLCI  1,784.1 (8.4) (0.5)
SET  1,436.9 19.1 1.3
JCI  4,406.8 (53.6) (1.2)
PCOMP  6,420.4 (41.0) (0.6)
KOSPI  1,998.1 (9.0) (0.5)
TWSE  8,283.9 (15.2) (0.2)
Nikkei  14,620.5 (112.1) (0.Cool
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) 591
Total Daily Vol (m shrs) 9,496
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
25 Sep
Target Price
($)
ST Engineering Buy 4.250 4.80
ComfortDelgro Buy 1.945 2.19
OCBC Bank Buy 10.440 12.40
Singapore Airlines Buy 10.440 11.40
Suntec REIT Buy 1.690 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
25 Sep
Target Price
($)
Ezion Holdings Buy 2.370 3.20
Goodpack Buy 1.720 2.00
CSE Global Buy 0.900 1.07
Mapletree Commercial Trust Buy 1.200 1.35
CDL Hospitality Trust Buy 1.640 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
Rowsley announced that the proposed acquisition of RSP
Architects Planners & Engineers and the proposed land
acquisition were completed. A total of 3.26bn consideration
shares issued at an issue price of S$0.150 per share will be
listed on 27 September but will be placed under a separate
temporary stock counter (Counter Name: Rowsley A, Stock
Code: T4A) until the Books Closure Date (3 October 2013) as
they are not entitled to the warrants under the proposed
bonus issue.
Internet Technology Group is proposing a voluntary delisting
from SGX. The exit offer price for each share is S$0.127 in
cash, representing approximately a 24.5% premium over last
traded price. The rationale for the delisting include: 1) Access
to Capital Markets No Longer Required; 2) Eliminate costs; 3)
Management Flexibility and 4) Low Trading Liquidity.
OKH Global is placing up to 60m new shares at a placement
price of S$0.68 per share. The placement price represents a
discount of approximately 8.36% to the last weighted
average price. The estimated net proceeds of about S$39.5m
will be used mainly to fund potential acquisitions,
investments and business expansion plans in connection with
the Group’s business.
The global investor confidence index (ICI) fell to 101.4 points
this month, down 3.5 points from last month's revised
reading of 104.9, the latest findings by State Street Global
Exchange have revealed. The decline was mostly driven by
sentiment in North America, where the figure fell 7.6 points
to 104.5 from August's revised reading of 112.1. European
confidence rose 4.7 points to 101.7, while Asian confidence
rose 2.1 points to 95.3 for the month.
Casino entry levy purchases and the amount of levies
collected have been dropping annually, due to the casino
novelty factor wearing off and the impact of social
safeguards including exclusion orders, and more recently,
casino visit limits to curb problem gambling. The Casino
Regulatory Authority disclosed that Singaporeans and
permanent residents forked out $174m in casino entry levies
in 2012. That's down from $195m in 2011 and $216m in
2010.
In property news, Serangoon Plaza in Little India has been put
up for collective sale at an indicative price range of between
$360m and $368m. The indicative price range translates to
between $1,751 psf ppr and $1,790 psf ppr. Over in
Clementi, Cityvibe mall has been put on the market with an
asking price above $130m.
US markets fell as investors once again weighed on whether
a looming government shutdown will hamper economic
growth. The Senate will likely vote on a stopgap spending bill
only this weekend that leaves the house just 1 full working
day to act before the Federal government’s spending
authority ends on Oct 1st. The 10-yr treasury yield dipped to
2.61%.
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PostPosted: Fri Sep 27, 2013 9:04 am    Post subject: Reply with quote

Today’s Focus
 Indofood Agri - Upgrade to BUY on higher forecast
output and ASP, target price raised to S$0.93
Global palm oil stockpile is at one-year low on stronger-thanexpected
demand, despite global Slowdown. Near-term
weakness in CPO prices may not drag planters much, given
output and earnings recoveries. Our analyst has adjusted
CPO prices for CY13F/14F/15F by -4%/-10%/-11% in USD,
0%/+1%/-1% in MYR. Beware of upside risks from FY16F, as
supply growth decelerates. We expect multi-year CPO price
gain from here. For the SGX-listed CPO stocks, we upgraded
Indofood Agri to BUY on higher forecast output and ASP,
target price raised to S$0.93 (Prev S$0.81). We believe the
counter is oversold. Maintain BUY on Bumitama Resources
(TP: S$1.26) and First Resources (TP: S$2.19) and HOLD on
Wilmar (TP: S$3.53).
In SPH’s upcoming full year results (11 Oct 2013), we expect
final/special DPS of 16Scts with payout in Dec, equating to
4% yield for a c.10-week period. Going forward, we believe
earnings could improve, going by recent upward adjustments
to consensus’ 2013 GDP growth forecast for Singapore. We
also noted that AdEx growth for the period from May to
Aug’13 has been stronger y-o-y. With the listing of SPH REIT,
we project that SPH’s cash pile has risen to c.S$1.1bn. We
estimate SPH can well afford to pay out at least another 20-
30 Scts per share, on top of its usual DPS (FY14F: 22 Scts) to
shareholders. We reiterate our BUY recommendation, with
TP adjusted to S$4.53 (from S$4.75) to account for the
S$0.18 special DPS paid in Aug and 5-10% cut to our
earnings forecasts.
SATS is acquiring Singapore Cruise Centre for S$110m to
further develop its gateway services. The purchase price
implies historical PE of c.7.9x and 1.7x P/BV. This acquisition
is mildly positive given immediate but minor earnings
accretion.
SembCorp Industries (SCI) reported a successful close of
Sembcorp Salalah IPO last night. The IPO offering of 33.4m
shares (~35% of share capital) was comfortably
oversubscribed with strong demands from investors. Shares
are expected to commence trading on 10 Oct 2013. SCI is
expected to recognise a total gain of S$117m, higher than
our S$109m forecast. This divestment gain would boost
US Indices Last Close Pts Chg % Chg
Dow Jones  15,328.3 55.0 0.4
S&P  1,698.7 5.9 0.3
NASDAQ  3,787.4 26.3 0.7
Regional Indices
ST Index  3,194.3 (14.3) (0.4)
ST Small Cap  578.8 (3.2) (0.6)
Hang Seng  23,125.0 (84.6) (0.4)
HSCEI  10,541.0 (57.1) (0.5)
HSCCI  4,415.4 (20.Cool (0.5)
KLCI  1,774.2 (9.9) (0.6)
SET  1,424.8 (12.1) (0.Cool
JCI  4,405.9 (0.9) (0.0)
PCOMP  6,407.5 (13.0) (0.2)
KOSPI  2,007.3 9.3 0.5
TWSE  8,184.7 (99.2) (1.2)
Nikkei  14,799.1 178.6 1.2
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013
100-Day MA
Index
STI
Total Market cap (US$bn) 590
Total Daily Vol (m shrs) 5,771
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
26 Sep
Target Price
($)
ST Engineering Buy 4.200 4.80
ComfortDelgro Buy 1.950 2.19
OCBC Bank Buy 10.370 12.40
Singapore Airlines Buy 10.430 11.40
Suntec REIT Buy 1.680 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
26 Sep
Target Price
($)
Ezion Holdings Buy 2.370 3.20
Goodpack Buy 1.780 2.00
CSE Global Buy 0.900 1.07
Mapletree Commercial Trust Buy 1.210 1.35
CDL Hospitality Trust Buy 1.640 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
PATMI to S$864.8m. Stripping out exceptional items, core
profits would be S$772.8m from S$753.3m in FY12. No
change to our BUY recommendation and TP of S$5.60.
TriTech is proposing a share split of every one (1) existing
share into two (2) Shares and upon completion, up to
386.6m new Shares will be issued. Following completion of
the proposed share split and the issue of the additional
shares, TriTech is proposing to issue bonus warrants of up to
386.6m non-renounceable bonus warrants on the basis of
one (1) Warrant for every two (2) Shares held.
Singapore’s manufacturing output in August fell 1.4% from
July, marking a third consecutive month of decline despite
expanding 3.5% y-o-y. Last month's growth in factory output
was bolstered by a 5.3% increase in electronics production,
thanks to a 12.7% expansion in the semiconductor segment.
Electronics, which make up about a third of the entire
manufacturing sector, helped to offset a 1.9% contraction in
biomedical output as a result of a 3.4% decline in the
pharmaceuticals segment. Excluding biomedical
manufacturing, Singapore's output grew 4.8%. With this set
of weak data, the market is expecting GDP in the third
quarter to contract 3.5 to 4%, in line with our expectations.
In property news, demand in all segments of the property
market slumped in July following the introduction of the total
debt servicing ratio (TDSR) framework in late June.
Transactions of strata industrial and commercial units fell
20.9% and 31% respectively from June. But residential deals
dropped even more, by 56.6%. These were findings made by
property consultancy CBRE.
Singapore’s population expanded at its slowest pace in nine
years. Latest government figures released showed that the
total population stands at 5.4 million, a 1.6% increase from
the 5.31 million recorded last June. The resident total fertility
rate (TFR) had increased to 1.29 last year from 1.2 in 2011,
but is still far below the replacement level of 2.1 - a trend
that has remained for more than three decades.
US markets rebounded Thursday lifted by a better-thanexpected
initial jobless claims (actual 305k, consensus 325k).
But August pending home sales declined a worse than
expected -1.9% m-o-m compared to the -1% expected. The
US 10-yr treasury yield held stabilized off the 2.61% level in
recent sessions heading into next week’s data heavy week
that culminates with the September employment numbers.
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PostPosted: Mon Sep 30, 2013 9:07 am    Post subject: Reply with quote

Please note this will be the last post here. All reports will be posted at www.redbeanforumsg.blogspot.sg with effect from tomorrow.

Today’s Focus
�� M1 key beneficiary of telco price hike cycle TP raise
to $3.6 (prev $3)
�� US budget impasse keeps markets on tenterhooks as
the week begins
Stocks are likely to start the week on a negative note as
concerns mount that the US government is heading for a
partial shutdown by tomorrow as the Senate and House of
Representatives remains unable to come to an agreement on
the healthcare program when their fiscal year 2014 begins 1
Oct. With the FED stating that the timeline to start QE
tapering being contingent on upcoming data, eyes will also
be on this week’s US September employment numbers
scheduled for release this Friday. Meanwhile, Italy’s
government is on the verge of collapse after allies of former
leader Silvio Berlusconi said they’d quit the cabinet.
We believe that STI’s pullback off 3260 in mid-Sept signalled
the start of a consolidation band between c.3150-3250 in
the weeks ahead. Beyond the likely short-term range bound
behaviour, we continue peg a year-end objective at c.3330
or 13.9x (ave) FY14F PE. The year-end objective is on the
assumption that the upcoming deadline to raise the US debt
ceiling is met and there is little/no net forward earnings
downgrade for STI component stocks in the upcoming 3Q
results season.
DBSV Research is positive on Singapore banks. While
earnings are expected to be stable for the rest of the year,
we believe there is upside to NIM and earnings going into
2014. Our analyst raises Singapore banks to Overweight.
Besides improved prospects in 2014 coupled with possible
interest rate hikes, Singapore banks provide a flight-to-safety
theme in the near term, especially when compared with its
ASEAN counterparts. We have imputed NIM recovery and
stronger earnings growth for 2014. But 2013 earnings will
be subdued on flat NIM and normalised provisions.
Regionalization may see downside risk in markets such as
Indonesia and Thailand (UOB has exposure in these two
markets; OCBC only has exposure in Indonesia) in the shortterm.
Both UOB and OCBC derive close to 20% of profits
from their Malaysian operations that has till date remained
resilient. We would be cautious should there be further
significant tightening on consumer debt in Malaysia to rein in
household debt accumulation.
US Indices Last Close Pts Chg % Chg
Dow Jones �� 15,258.2 (70.1) (0.5)
S&P �� 1,691.8 (6.9) (0.4)
NASDAQ �� 3,781.6 (5.Cool (0.2)
Regional Indices
ST Index �� 3,210.2 15.9 0.5
ST Small Cap �� 578.8 (0.0) (0.0)
Hang Seng �� 23,207.0 82.0 0.4
HSCEI �� 10,494.4 (46.7) (0.4)
HSCCI �� 4,423.2 7.8 0.2
KLCI �� 1,776.2 2.0 0.1
SET �� 1,417.5 (7.3) (0.5)
JCI �� 4,423.7 17.8 0.4
PCOMP �� 6,379.8 (27.6) (0.4)
KOSPI �� 1,999.8 (12.0) (0.6)
TWSE �� 8,230.7 46.0 0.6
Nikkei �� 14,760.1 (39.1) (0.3)
Dow Jones �� 15,258.2 (70.1) (0.5)
STI Index Performance
Singapore
Total Market cap (US$bn) 592
Total Daily Vol (m shrs) 4,712
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price ($)
27 Sep
Target Price
($)
ST Engineering Buy 4.210 4.80
ComfortDelgro Buy 1.955 2.19
OCBC Bank Buy 10.450 12.40
Singapore Airlines Buy 10.430 11.40
Suntec REIT Buy 1.685 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
27 Sep
Target Price
($)
Ezion Holdings Buy 2.370 3.20
Goodpack Buy 1.765 2.00
CSE Global Buy 0.905 1.07
Mapletree Commercial Trust Buy 1.230 1.35
CDL Hospitality Trust Buy 1.625 1.80
Source: Bloomberg Finance L.P., DBS Vickers
Singapore
Wired Daily
Page 2
We believe that once these emerging ASEAN markets start
to recover from the current macro weakness, the Singapore
banks’ regionalisation journey should be back on track. We
prefer OCBC (Buy, TP: $12.4) over UOB (Hold, TP: $21.9).
SingTel doubled its excess usage charges to S$10.70 per GB
that is a positive for the sector. We expect M1 and StarHub
to follow soon. M1 is a key beneficiary of the price hike
cycle. We raise our FY14F/15F earnings 7%/14% assuming
that M1 charges S$10.70 per GB from Jan 2014 onwards.
Our TP is raised to S$3.60 based on DCF (WACC 6.5%,
terminal growth 0%). M1 is trading at 17x FY14F PER versus
19x for StarHub despite offering superior growth. M1’s
FY14F dividend yield of 5.3% is also superior to StarHub’s
4.7%. M1 is the only telco in Singapore, Malaysia &
Indonesia, which offers 5% plus yield with double-digit
earnings growth.
Nam Cheong has sold 4 Platform Supply Vessels for
approximately US$120 million to a new customer that is an
emerging offshore marine services company based in Latin
America. With that, the cumulative order book reaches
RM1.7 billion. The total sale of 20 vessels for 2013 is close
to the record high of 21 vessel sales achieved in 2012.
CM Pacific has entered into a conditional sale and purchase
agreement to sell its entire New Zealand property business
to China Merchants Properties Development for HK$356m.
The sale is targeted for completion in 4Q13, and the Group
will realise a gain of c. HK$111m on its P&L. The divestment
and consideration amount (which is about S 6.5cts per
share) is in line with our expectation and will help the Group
to focus on its core toll road business, while improving its
balance sheet slightly. Next up for the Group will be to look
for more toll road acquisitions to grow its business. Maintain
Buy and DCF-based TP of S$1.07, which assumes the
outstanding convertible bonds will be converted.
Sky Vue at Bishan Central by CapitaLand and Mitsubishi
Estate Asia received on the first day of its launch. 410 of the
505 units released for sale have been sold with one- and
two-bedroom units being the most popular among buyers.
The average price achieved for all the units sold is $1,500
psf. Prices ranged from an average $750,000 for a onebedroom
unit to an average price of $1.58 mil a threebedroom
unit.
US stocks fell as concerns grew that the budget impasse will
hurt economic growth. Over the weekend, congress
remained in deadlocked over Republicans’ insistence on
delaying the 2010 health-care law. The House has voted
231-192 to stop many of the Affordable Care Act’s central
provisions for one year and tie that to an extension of
government funding through Dec. 15.The Senate could
reject the House’s position when it comes into session today.
This development raises the prospect of the first government
shutdown since 1996, putting as many as 800,000 federal
employees out of work starting Tuesday, Oct. 1.
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PostPosted: Thu Nov 21, 2013 11:37 am    Post subject: Reply with quote

Today’s Focus
�� Singapore 3Q GDP grows better-than-expected 5.8%
�� Keppel secures USD265mil jackup order
Keppel FELS Limited has secured a contract to build a repeat
KFELS Super A Class harsh environment jackup rig from a
subsidiary of Ensco plc for around US$265mil. Scheduled for
delivery in 2Q 2016, it will be the fourth ENSCO 120 Series
jackup rig that Ensco has ordered from Keppel FELS since
2011. As part of the contract, Ensco has an option to order
another similar rig.
Rex International Holding, Lime Petroleum Norway, has
received the green light to acquire 10% stakes in two
offshore licences in Norway from North Energy ASA. Lime
had received the approval from Norway's Ministry of
Petroleum and Energy for stakes in PL 707 and PL 708. The
10% interest in the 2 licences will become effective on Nov
29.
Yoma Strategic Holdings is releasing 433 new apartment
units at its Star City residential development. The
development is situated on a 135-acre site in Thanlyin
Township in Yangon. The residential units are available to the
public for purchase on 23 November. A large number of
potential buyers are already on the waiting list for these very
affordable newly-released apartments and a quick take-up
rate is expected since this is the last opportunity to purchase
units in Zone B, this according to MD of Yoma Strategic’s real
estate division.
Singapore 3Q GDP rose 5.8% y-o-y, better than consensus
expectation for 5.3% and 2Q’s 5.1% figures. The
government raises GDP growth forecast to 3.5-4% (previous
2.5-3.5%) for 2013 and 2-4% for 2014. 3Q growth was
underpinned by strength in the manufacturing, construction
and services sector.
US markets fell after the FED minutes showed officials said
they might reduce their US$85bil in monthly bond purchases
“in coming months” as the economy improves. Consensus
expects the FED to start tapering from March 2014 earliest.
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