Monday, September 23, 2013

PSR Coverage – SG Top Picks (Phillip)

PSR Coverage – SG Top Picks
We have removed Singapore Exchange and Pan United from our top pick list and replaced it with DBS Group and SingTel. With increasingly positive economic data from the major economies (US, China, Japan and Eurozone), we think that big caps will stand to benefit most in the near term, thus our change in focus.


#1: DBS Group (New!)
We like DBS (Accumulate, TP: S$17.50) for the following reasons. 1) Benefit from rising interest rates. The eventual increase in short term interest rates will lead to higher interest income. DBS’s high proportion of cheap CASA deposits will contribute to higher NIMs. 2) Higher exposure to Greater China relative to local Singapore peers. This allows DBS to benefit from any economic improvement in China, in particular a rise in import/export activities. DBS is able to offer transaction banking services, including trade financing. 3) Price to book trading at a discount relative to peers. We expect rerating potential for DBS as it continues to gain traction in its various focus areas. These include its SME business, Wealth Management, and Transaction banking services. 4) Various revenue streams registering strong results. The potential stabilizing of NIMs and strong double-digit loans growth leads to higher net interest income. Fees and Commission, driven by WM and trade-related fees, grew double-digit y-y in 1H13

#2: SingTel (New!)
We like SingTel (Accumulate, TP: S$3.99) for the following reasons. 1) Attractive dividend yield of 4%-5%, with potential for dividend growth. With a committed dividend payout range of 60%-75% of net profit, higher net profits will lead to higher dividends. 2) Healthy EBITDA growth in SG and AU excluding currency effects. In Singapore, continued data monetizing is expected to drive higher mobile ARPU. SingTel continues to dominate in both the mobile and fibre broadband segment, with continued high net adds and low churn rates. In Australia, Optus’ focus on maximizing profits from existing customers instead of growth of customer base has also improved EBITDA despite stiff competition from its AU peers. 3) Strong growth potential, both from overseas associates including AIS and Telkomsel, and from investments in Group Digital Life when they crystallize. Besides increasing revenue, potential successful Digital Life initiatives may also increase loyalty among customers of both SingTel and its overseas associates.

#3: Keppel Corporation
We like Keppel Corp (Accumulate, TP: S$12.25) for the following reasons. 1) Robust O&M outlook, well-supported by high dayrates and utilizations for both jack-up and semi-sub rigs. Crude oil prices continue to stay at healthy levels above US$80/barrel, which should support E&P spending by oil companies. 2) Strong order book wins, with S$4.4bn new orders YTD vs PSR FY13F of S$5.9bn. Management continues to be positive, citing rising energy demand from emerging countries, and depletion in existing oil fields. 3) Stronger track record relative to its Chinese peers has also contributed to its healthy order books. This is despite aggressive pricing and appealing payment terms offered by its Chinese peers. 4) Y-y higher O&M margins from repeat orders of its proprietary KFELS B Class jack-up rigs, and record delivery of 20 jack-up rigs in FY13F (11 already delivered in 1H13). In addition, we note that average prices for its proprietary KFELS B class jack-up design increased by more than 10% over the past two years. We forecast margins of >14% for FY13-15E vs FY12 margin of 13.5%, as the majority of 2014-15 earnings should materialize from contracts secured at higher pricing in 2012-13. 5) Attractive dividend yield of ~4-5% to reward its investors.


Source/Extract/Excerpts/来源/转贴/摘录: Phillip-Research,
Publish date: 20/09/13

No comments:

Post a Comment

Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock