Saturday, February 1, 2014

Pacific Radiance: Radiating Promising Earnings Growth With Aggressive Fleet Expansion

17 JANUARY 2014
Pacific Radiance: Radiating Promising Earnings Growth With Aggressive Fleet Expansion
By Nicholas Tan

Fresh from its initial public offering (IPO) listing on the mainboard of the Singapore Exchange in November last year, Shares Investment was privileged to have caught up with Pacific Radiance’s managing director, commercial and business development, James Pang, in an exclusive interview to share with us the company’s latest developments, competitive edge and future growth plans.

As we began a new year, you would recall that the local stock market failed to hold on to its May 2013 gains and ended last year flat. One industry, however, stood out from the others and is expected to continue to outperform this year, as the prevalent hunt for black gold intensifies in high growth regions such as Asia. Global spending by governments and international oil majors on offshore exploration and production have been on the rise, in anticipation, that the demand for energy will surge along as the pace of the world’s economic recovery hastens.

Mencast -Acquisition spree again (NRA)

Mencast Holdings
Current Price S$0.51
Fair Value S$0.67
Acquisition spree again

 Earnings below expectations. Mencast’s 3Q13 profits of S$1.6m came in 40% below our estimates due mainly to lower-than-expected gross profit margins. This should not ring alarm bells as 3Q has historically been weaker in the previous FYs and we expect 4Q to jump back up, as such we maintain our FY13 estimates for the time being. However, as we adjust our FY14-15 sales for the new acquisition, our net profit forecasts remain relatively unchanged. We lower our fair value to S$0.67 from S$0.71 on the assumption of the new share dilution upon the completion of the acquisition, still pegged at 10x FY14 PER. Given the 36% potential upside, maintain

Sa Sa International - Not a thing to worry about (CIMB)

Sa Sa International Holdings
Current HK$8.99
Target HK$11.00
Not a thing to worry about

 Sa Sa’s 15.8% SSSG in 3QFY3/14 was not a surprise. Sales growth in Dec was slower than in Oct-Nov as more Chinese tourists travel abroad during festive seasons. We are confident about our FY14-15 SSSG forecast of 15%as we have seen increasing contribution from day trippers and domestic consumers after the holidays in 2013. Sales growth was 17.9% for 1-8 Jan, aided by 14% SSSG. For 2H14, we expect sales growth of20% yoy, on 16% SSSG (16-17% in 4Q14) and 20% earnings growth. We keep our FY14-16 EPS and target price of HK$11.oo, based on 25x CY14 P/E, the average of the staples basket. Sa Sa remains our sector top pick and an Add, with market share gains as a catalyst.

Yeo Hiap Seng- Neglected beverage brands (CIMB)

Yeo Hiap Seng
Current S$2.47

 Neglected beverage brands
The Yeo’s brandhas significant latent potential that has not been tapped because of the company’s focus on property development. However, itsland bank is almost depleted now and Yeo Hiap Seng(YHS)ison the verge of becoming a pure F&B player again.

We think that there is a possibility that Far East Organization, YHS‟s major shareholder, will privatise the company to facilitate its sale to a strategic buyer. The other alternative is to maintain the status quo and reallocate resources to develop the F&B brands.

Malaysia Outlook 2014: A stock-picking market (CS)

Malaysia Market Strategy
Outlook 2014: A stock-picking market

■ Short-term pain for long-term gain. We believe 2014/2015 is about administering the bad medicine and tightening the belt. Cutting subsidies is a main theme. The 6% GST will kick start in April 2015, thus corporate margins could get squeezed. The high bond foreign ownership is a worry, as the ringgit is vulnerable to fund flow shocks. All this short-term pain is necessary to harness the long-term gain which stems from an improving budget deficit and trade surplus, thus stabilising the ringgit and avoiding the rating downgrade.

Sinotrans Shipping -New orders at a discount...and more to come (CS)

Sinotrans Shipping
Price (06 Jan 14 , HK$) 2.87
TP (prev. TP HK$) 3.30 (3.00
New orders at a discount...and more to come

● Sinotrans Shipping (SS) has placed orders for four panamax vessels for US$26 mn each from a shipyard owned by its parent, which offered a 6% discount relative to prevailing newbuild prices.

● The orders will help SS lock in a daily cost of only US$8,500/day, 31% below the current spot rate of US$12,250/day and 11% lower than SS' average cost of US$9,500/day for its existing fleet. More new orders will be announced in the coming months.

Friday, January 31, 2014

Pacific Radiance: 积极扩大船队,财源滚滚而来

Pacific Radiance: 积极扩大船队,财源滚滚而来
文: 陈挚文 (译:麦美莹) 2014年01月17日 企业摘要
Pacific Radiance 刚在去年11月于新加坡交易所主板上市,《股市资讯》有幸与公司的商业及业务发展董事经理冯伟桄做了一个独家专访,他与我们分享了公司的最新发展、竞争优势及未来增长大计。


China Banks -Some P/BVs have fallen close to 2SD below mean (DBSV)

Pulse of China Banks
Some P/BVs have fallen close to 2SD below mean

• 2013 new Rmb loans were Rmb8.89trn; we expect Rmb9.3-9.7trn for 2014
• TSF remained strong driven by non-bank financing
• Some banks’ P/BV have fallen close to 2SD below mean despite stable macro environment

• We like CCB among large caps, CMB among smaller banks December new loans were lower than expected. New bank lending amounted to Rmb483bn in Dec, lower than a survey mean of Rmb570bn. ST loan demand was strong while LT corporate loan growth declined m-o-m. Rmb L/D ratio eased to 68.9% at Dec’13 from Nov’s 69.2% due to deposit seasonality and slower credit growth.

China South City -Tencent To Become Strategic Shareholder (RHB)

China South City
Target Price: HKD3.03
Price: HKD2.17
Tencent To Become Strategic Shareholder

What’s new?
• After the market closed yesterday, China South City (CSC) announced that Tencent (700 HK, SELL, TP: HKD321) will become a strategic investor in the company through the subscription of 680.3m new shares at HKD2.20/share (a 1.4% premium to its last closing price). Upon completion of the transaction, Tencent will own a 9.9% stake in CSC, which will be subject to a 3-year lock-up period and CSC will receive HKD1.5bn in cash.

M-REIT - Less excitement ahead (CIMB)

REIT - Less excitement ahead

We expect REITs' 2014 share-price performances to be subdued, weighed down by rising interest rates, a lack of asset injections and a potentially stronger performance of the broader market. Due to various macro and fundamental headwinds facing REITs in 2014, we remain Neutral on this asset class. Although on average, REITs offer higher yields than the average yields for the FBM KLCI of 3.4-3.7%, we believe their share-price upside will be capped by likely rising interest rates later in the year. We prefer property developers.

Spring REIT -CBD Prime Transforming IPO growth to yield (CS)

Spring REIT
Price (13 Jan 14, HK$) 3.15
TP (prev. TP HK$) 4.29 (NA)
Initiating Coverage with OUTPERFORM
New report: CBD Prime: Transforming IPO growth to yield

● We initiate coverage on Spring REIT with an OUTPERFORM rating and HK$4.29 TP (36% potential upside). The company offers direct exposure to the "premium grade" office market in Beijing that can potentially benefit from the growth in IPOs in China—it owns office towers 1 and 2 in China Central Place, with 120,245 sqm of office space in the southeastern corner of Beijing’s traditional CBD.

UE E & C - Piling on the cash (CIMB)

UE E & C  
Current S$1.02
Target S$1.12
Piling on the cash

▊ UE E&C is a consistently cash-generative company, and has a sizeable regional presence while maintaining its core strengths in Singapore. It is poised for an earnings jump as contributions from its property development stakes kick in from FY14. UE E&C has a strong local franchise and has expanded regionally of late. Its stakes in property development offer earnings upside in the next three years as these properties reach completion. We initiate coverage with an Add rating and a target price of S$1.12, based on 4.7x CY15 P/E (in line with the sector’s six-year mean). Catalysts could come from more joint venture property developments and a pick-up in construction order wins.

Thursday, January 30, 2014

M1: Declares S$0.07 special dividend (OCBC)

Fair value S$3.30
add: 12m dividend forecast S$0.15
versus: Current price S$3.24
Declares S$0.07 special dividend

M1 Ltd saw FY13 revenue fall 6.4% to S$1007.9m, and was 3.8% below our forecast, while net profit climbed 9.4% to S$160.2m, or 3.5% above our forecast. M1 declared a final dividend of S$0.071 per share and a special dividend of S$0.071, bringing the total full year dividend to S$0.21 per share. This translates into a payout ratio of 121% of its earnings, versus its official minimum payout ratio of 80%. Going forward, management believes that it can continue to achieve moderate earnings growth (within the single-digit range), where it remains largely positive about the mobile business; but slightly more guarded about the fixed services segment.

KLCC Property - Still benefiting from stapling (DBSV)

KLCC Property
BUY RM5.57
KLCI : 1,815.34
Price Target : 12-Month RM 8.55
Still benefiting from stapling

FY13 profit within our estimate but above consensus’
29sen DPS implies 5% distribution yield
Stable office asset earnings and robust retail revenues going forward; triple net lease minimises cost pressure
Maintain BUY with RM8.55 TP

FY13 in line. 4Q13 net profit (excl. RM271m revaluation gains) jumped 75% y-o-y (-2% q-o-q) to RM174m due to lower tax expenses from asset transfers to KLCC REIT post-stapling. Revenue was flat y-o-y (+3% q-o-q) as the Petronas Twin Towers triple net lease was renewed in 4Q12.

Ascendas REIT: Maintaining stable outlook (OCBC)

Ascendas REIT:
Fair value S$2.40
add: 12m dividend forecast S$0.141
versus: Current price S$2.15
Maintaining stable outlook

Ascendas REIT’s (A-REIT) 3QFY14 DPU eased 2.2% YoY to 3.54 S cents, but was within our expectations given that 9MFY14 DPU formed 75.6% of our full-year DPU forecast. Leasing demand remained in the positive territory in our view, as A-REIT has continued to reduce its lease expiries (5.3% of FY14 rental income left for renewal vs. 10.5% a quarter ago). In addition, positive rental reversion averaging 9.7% was still achieved for the quarter. A-REIT also proposed some changes to its fee structure – a move we view positively as it would reduce the fee payable to the REIT Manager in favour of unitholders with effect from FY15. We also note that A-REIT will make distributions on a semi-annual basis to align with the payout from its China properties and reduce the volatility seen in its quarterly DPU. We maintain BUY on A-REIT with a revised fair value of S$2.40 (previously S$2.45).

MobileOne: Spot on profit, special dividend surprise! (DBSV)

S$3.24; M1 SP
Price Target : 12-Month S$ 3.60
Spot on profit, special dividend surprise!

•FY13 earnings of S$160m (+ 9.4%) was in line; including special DPS of 7.1Scts, final DPS of 14.2Scts beat our 9Scts estimate  
•Management guided for single-digit growth in FY14, prompting us to trim FY14F/15F earnings by 2% each
•BUY with DCF-based (WACC 6.5%, terminal growth 0%) TP of S$3.60, implying 11% upside potential and 5% plus yield

胡立阳: 大家在2014年不要从马背摔下

胡立阳: 大家在2014年不要从马背摔下
文: 汪文龙 (译:麦美莹) 2014年01月15日 Tradeable, 名人对话, 焦点


2014前景 – 美国股价偏高不是好兆头

Wednesday, January 29, 2014

Mapletree Logistics Trust -Strength to strength (DBSV)

Mapletree Logistics Trust
BUY S$1.035
STI : 3,133.76
Price Target : 12-Month S$ 1.16

•3QFY14 results in line; YTD net income is 77% of forecast
•Future growth to be driven by acquisitions/ developments, portfolio earnings remain resilient
•Maintain BUY rating and S$1.16 TP

Resilient quarter fueled by strong rental reversions. Despite being hit by a weak JPY-S$ exchange rate, Mapletree Logistics Trust (MLT) reported resilient results – topline and net property income came in at S$78.1m (+0.9% y-o-y) and S$67.4m (-0.2% y-o-y) respectively. Forex losses were mitigated by strong rental reversions of up to 23% mainly for properties in Singapore and Hong Kong, and the acquisition of two properties in the year. Excluding the forex impact, topline would have grown by a stronger 4.8% y-o-y. Average portfolio occupancy remained steady at 98.4%. Distributable income grew 7.7% to S$45.0m (DPU 1.82 Scts), supported by a lower effective interest rate of 1.9%.

Mapletree Commercial Trust - Stronger than expected (CIMB)

Mapletree Commercial Trust -
Current S$1.17.
Target S$1.31
Stronger than expected

MCT's 3QFY13/14 revenue rose by 22.4% yoy and DPU rose by 11.9% yoy. 9MFY14 DPU was slightly better than expected at 78% of our FY14 forecast due to strong rental reversion and rising occupancy. With further room to grow through rental reversions and, in part, riding on the recovery trend in the office market, we raise FY14-16 DPU by 2% and upgrade our rating on MCT to Add from Hold. Our slightly higher DDM-based (discount rate: 8.4%) target price is S$1.31.

CapitaMall Trust - Awaiting catalysts (CIMB)

CapitaMall Trust
Current S$1.88
Target S$2.06
Awaiting catalysts

▊ CapitaMall Trust (CMT) has just announced its 4Q13 results, posting yoy growth of 6.9% in revenue and 14.9% in DPU. Its full-year earnings were in line with our estimate, while revenue was just 2% higher and DPU was spot-on. The higher NPI was mainly attributed to the various completed AEIs. We marginally lift our FY14-15 DPS estimates, but maintain our Hold rating, with an unchanged DDM-based (discount rate: 7.4%) target price of S$2.06, pending more impactful catalysts.

Ascott Residence Trust- Awaiting acquisitions (DBSV)

Ascott Residence Trust
BUY S$1.24
STI : 3,133.76
Price Target : 12-Month S$ 1.33 (prev. S$ 1.42)

•4Q13 results in line; NAV lifted by stable property valuations
•Awaiting the acquisition kicker
•Maintain BUY; S$1.33 TP (based on DCF metric) has been adjusted for rights issue

4Q13 results in line. Gross revenue and profit came in at S$83.9m (+11% y-o-y) and S$41.6m (+8% y-o-y), respectively. Topline growth was driven by contribution from an expanded portfolio which offset the income vacuum from divested properties. Portfolio RevPAU was 7% lower y-o-y at S$129/night. Distributable income grew 15% y-o-y to S$26.3m but DPU fell 34% due to an enlarged share base after the 1-for-5 rights issue.

Frasers Centrepoint Trust: Turning to acquisition for growth (OCBC)

Frasers Centrepoint Trust:
Fair value S$2.02
add: 12m dividend forecast S$0.113
versus: Current price S$1.79
Turning to acquisition for growth

 Frasers Centrepoint Trust (FCT) reported 1QFY14 DPU of 2.50 S cents, up 4.2% YoY, in line with our expectations. Causeway Point (CWP) continued to shine in 1Q, turning in a robust 8.6% growth in NPI, while Northpoint registered a 1.4% growth. However, its portfolio performance was somewhat dampened by Bedok Point, which saw negative reversions and occupancy drop during the quarter. Going forward, FCT disclosed that it will continue to fine-tune the tenant mix at Bedok Point, and is willing to lower rents to keep incumbents and entice new tenants for sustainable performance. Hence, pressure on base rents and fluctuations in occupancies are expected going forward. Nevertheless, management maintains that CWP and Northpoint are likely to continue to deliver in FY14. With the completion of the A&A works at CWP, FCT is also looking to acquisitions to boost growth. We maintain BUY with unchanged fair value of S$2.02 on FCT.

Frasers Commercial Trust - A stable REIT (CIMB)

Frasers Commercial Trust -
Current S$1.26
Target S$1.39
A stable REIT

Frasers Commercial Trust (FCOT) has just announced its 1QFY14 results, posting a drop of 3.1% yoy in revenue, but a gain of 29.7% in DPU. Its 1QFY14 earnings were in line, with both revenue and DPU accounting for 24% of our full-year estimates. The higher DPU was mainly attributed to the savings from the buyback of the convertible perpetual preferred units (CPPU) in FY13. We maintain our Add rating, with an unchanged DDM-based (discount rate: 8.8%) target price of S$1.39. Positive catalysts expected to come from organic growth and the potential sale of the hospitality site at China Square Central.

Tuesday, January 28, 2014

Keppel Land - China sales now the key driver (CIMB)

Keppel Land -
Current S$3.26
Target S$3.51
China sales now the key driver

KepLand's NPAT growth (+22% yoy) in FY13 was propped up by divestment gains. Excluding this, we estimate core profits would have declined 43% yoy. Its 4Q13 core EPS is in line with expectations, at 25% of our full-year estimate (FY13 at 100%) and 20% of consensus. Its high-margin projects in Singapore are now complete. Short of acquisitions, its earnings profile is expected to be driven by China development sales. We see China housing headwinds building up again. Divesting MBFC3 could unlock value, but our question then is what next? Maintain Hold on KepLand, with a higher RNAV discount of 25% (20% previously), given its increasingly higher China make-up. FY14/FY15 core EPS is adjusted by -9%/+11% on lower ASP and changes in project completions.

Raffles Medical - Adding capacity (CIMB)

Raffles Medical Group -
Current S$3.08
Target S$3.68
Adding capacity

Raffles Medical Group (RFMD) began 2014 on a strong footing and the latest news on its land acquisition and hospital expansion reflect better use of its cash proceeds and allay concerns about over-crowding/lack of capacity. Our FY14-15 EPS is cut by 2-4% to reflect the higher financing costs and our target price is lowered by 3% (still based on 23x CY15 P/E). The catalysts are the higher healthcare dollars from the expansion of Raffles Hospital and the successful development of integrated international hospitals in China with its JV partners. We maintain our Add rating on RFMD.

Genting Hong Kong - Lower earnings and price target; still a value play (DB)

Genting Hong Kong -
Price at 20 Jan 2014 (USD) 0.42
Price target - 12mth (USD) 0.54
Lower earnings and price target; still a value play

Deep value and plenty of cash – what's next?
At a 37% discount to market SOTP, Genting Hong Kong remains a deep value stock with nearly US$1.0bn gross cash after paring down its stake in NCLH. The Lim family raised its stake to 58.1 %, or 75.9% including that held by Genting Malaysia.

Mapletree Industrial Trust - 3Q results ahead on strong reversions (DB)

Mapletree Industrial Trust -
Price at 21 Jan 2014 (SGD) 1.32
Price target - 12mth (SGD) 1.48
3Q results ahead on strong reversions; raising estimates & TP

Mapletree Industrial Trust reported 3Q FY14 DPU of 2.51cts (+1.6% QoQ +8.2% YoY), above our forecast of 2.23cts on account of stronger-than-expected rental reversions and lower-than-exp ected operating expenses. Revenue and NPI rose 9.3% and 12% YoY respectively , driven by positive reversions and higher occupancies for Flatted Factories. Passing rents rose 7%YoY to S$1.73.

Frasers Centrepoint Trust - Strongly centred (CIMB)

Frasers Centrepoint Trust  
Current S$1.79
Target S$2.05
Strongly centred

▊ FCT's 1QFY9/14 results were largely in line, with DPU coming in at 23% of our FY13 number. Revenue growth of 5% yoy and NPI growth of 4.4% yoy enabled 1Q to achieve 24-25% of our full-year forecasts. Thanks to strong performances from its malls, FCT is fundamentally solid and, in our view, resilient to any external headwinds. We expect the acquisition of Changi City Point to contribute to the next stage of growth. We maintain our Add rating with an unchanged DDM-based target price (discount rate: 8.4%) of S$2.05 as we await further acquisition news.

Cambridge Industrial Trust - Growing Steadily (DBSV)

Cambridge Industrial Trust
HOLD S$0.70
STI : 3,147.33
Price Target : 12-Month S$ 0.74
Growing Steadily

• DPU of 1.251 Scts in line with expectations
• Acquisitions and developments to fuel growth in 2014/2015
• HOLD, TP S$0.74

DPU of 1.251 Scts is in line with our expectations, bringing full year DPU to 4.976 Scts (+ 4% y-o-y). In 4Q13, topline and net property income was 3.1% and 8.7% lower y-o-y, mainly due to the impact of divestments (four properties but mainly 63 Hillview) which was partly mitigated by the contribution from the acquisition of four properties and development/asset enhancement projects (88 Int'l Rd and 4/6 Clementi Loop) in 1H13, supported by escalations in rent for selected properties. Portfolio occupancy remained stable at c.97%. Distributable income in 4Q13 rose by 3.8% y-o-y to S$15.5m (including S$1.2m capital distribution), translating to a DPU of 1.251 Scts.

Monday, January 27, 2014

Starhill Global REIT - Sunny in Australia (DBSV)

Starhill Global REIT;
Hold  S$0.76
Price Target : 12-Month S$ 0.87
Sunny in Australia

•Higher income from Singapore and Australia mitigated weaker overseas contribution
•Growth to be driven by Singapore and Australia
•Maintain HOLD, TP S$0.87

4Q13 results in line. Starhill Global REIT (SGREIT) reported higher gross revenues and NPI of S$49m (+3.6% y-o-y) and S$39m (+3.4%), respectively. This was attributed to solid performance of Singapore assets: Ngee Ann City is enjoying 6.7% higher base rents after Toshin renewed its master lease in 2Q13; Wisma Atria continued to perform post-AEI and remix which saw tenant sales increase by +20% y-o-y and a positive impact on rents. Australia also contributed strongly after the acquisition of Plaza Arcade in March 2013. But strong income from Singapore and Australia was tempered by weak performance of Chengdu and Japan properties. Hence, distributable income was only S$27m, translating into 1.23Scts DPU (+9% y-o-y).

Jaya Holdings - Steady proxy to industry upswing (DBSV)

Jaya Holdings
BUY S$0.82
STI : 3,133.76
Price Target : 12-month S$ 0.91 (Prev S$ 0.90)
Steady proxy to industry upswing

• 83% fleet utilisation in low season, higher day rates from more sophisticated fleet boost charter income in 2Q-FY14
• Charter backlog improves significantly as Jaya increases its presence in the Middle East market with long-term charters
• Interim dividend of 1Sct declared (1H13 interim: 0.5Scts)
• Maintain BUY for 11% upside to TP of S$0.91, plus 4-5% dividend yield supported by net cash position

Keppel T&T -Await a better entry point (CIMB)

Keppel T&T
Current S$1.86
Target S$1.94
Await a better entry point

FY13 net profit of S$63.2m was broadly in line with our expectation and formed 102% of our full year estimate. We revise up our FY14-16 EPS by 2-3% for the higher-than-expected margins, with a slightly higher SOP-based target price of S$1.94. However, we downgrade the stock from Add to Hold as we believe that the positives have largely been priced in. The share price has rallied since KPTT announced its intention to inject its data centres into a REIT in 1H14, which we think has been overdone. While we are positive on the news, we believe it will take time for KPTT to reinvest the funds raised from the IPO to make a meaningful impact on its earnings.

K-GREEN TRUST -7.4% yield masks a partial return of capital (AM)

(SELL, S$0.72)
Revenue dragged down by absence of construction revenue. KGT’s FY13 revenue was 12% lower YoY, which was largely the result of the exclusion of construction revenue arising from the flue gas treatment upgrade. Revenue from operation and maintenance (O&M) was S$50mil for FY13, which was S$0.3mil lower than FY12, due to lower output from the waste-to-energy plants and NEWater plant. This was partially offset by annual adjustment of O&M and power tariffs.

Jaya Holdings -Smooth sailing (CIMB)

Jaya Holdings
Current S$0.82
Target S$0.90
Smooth sailing

At 47% of our FY14 forecast, 1HFY6/14 core net profit of US$15.1m (-10% yoy) was in line with our expectations (13% below consensus). Higher day rates and utilisation helped offset the shipyard overheads. The group also declared an interim DPS of 1Scts, double that of 1HFY13. We lower our FY14 EPS by 2% due to higher shipyard losses, while raising our FY15-16 by 2-4% to factor in higher day rates. Jaya remains an Add with an unchanged target price, still at 1x CY14 P/BV (its four-year mean). Potential catalysts are stronger chartering operations, shipbuilding wins and clarity on its strategic review.

曾淵滄專欄 27.01.14:炒股不炒市受考驗



Cambridge Industrial Trust -Growth Strategy Intact Despite Change Of CEO (DMG)

Cambridge Industrial Trust
Target Price: SGD0.81
Price: SGD0.70
Growth Strategy Intact Despite Change Of CEO

 Last Friday, Cambridge Industrial Trust reported 4Q13 results that were in line, as well as the disappointing – although unsurprising - resignation of CEO Christopher Calvert. Its portfolio’s performance as a result of recent acquisitions and AEIs are expected to maintain its strong DPU growth going into FY14F. We maintain our FY14F DPU of 5.4 cents, for an implied 7.7% yield. Maintain BUY on CREIT, with our SGD0.81 TP offering a potential 16% upside.

Sunday, January 26, 2014

Raffles Medical Group: Enlarging its healthcare footprint (OCBC)

Raffles Medical Group:
Fair value S$3.61
add: 12m dividend forecast S$0.045
versus: Current price S$3.09
Enlarging its healthcare footprint

Raffles Medical Group (RMG) has agreed to acquire a land site adjacent to its Raffles Hospital from the Singapore Land Authority for S$105.2m. It will be able to boost its total hospital GFA by 72% to 49,217.28 sqm upon completion, which is expected in FY16. This will allow RMG to expand its range of sub-specialty centres and its healthcare education and clinical research activities, which we view positively. Together with a recent Holland Village property purchase and development project, total capex is estimated to amount to S$430m, which RMG expects to finance with internal resources and bank borrowings. Management highlighted that its overseas expansion plans remain intact despite this development. We maintain BUY and S$3.61 fair value estimate on RMG, pegged at 29x FY14F EPS.

CapitaMall Trust - Fairly valued; uninspiring catalyst (MKE)

CapitaMall Trust
Share Price: SGD1.88
Target Price: SGD2.05
52w high/low (SGD)2.38/1.82
Fairly valued; uninspiring catalyst

FY13 results in line with our and market expectations.
No material impact from Westgate Tower sale with only marginal 1 SGD cts/share accretion. Capital distribution unlikely.
Maintain HOLD on valuation grounds and uninspiring DPU growth prospects as most of the eligible malls in its portfolio have already undergone asset enhancements.

Zhulian -Dragged by domestic sales (HwangDBS)

Zhulian Corp Bhd
KLCI : 1,814
Price Target : 12-Month RM 3.40 (Prev RM 3.90)

Dragged by domestic sales
• 4Q13 earnings below expectations; dragged by domestic sales
• Cut FY13-14 EPS by 17-19% in view of a challenging near-term outlook for Malaysia and Thailand markets
• Downgrade to Fully Valued with RM3.40 TP

Axis REIT - Time to revisit this REIT (CIMB)

Axis REIT -
Current RM2.90
Target RM3.14
Time to revisit this REIT

We came away from Axis REIT's 4QFY13 analyst briefing feeling better about its outlook relative to our previous stance. We gather that its dry spell in terms of acquisitions is likely to come to an end as management seems confident of securing new assets in 2014. Given the potential acquisitions, coupled with Axis REIT's share price underperformance, we upgrade our call in the stock to a Buy, with a revised DDM-based target price of RM3.15, after we revised our cost of equity assumptions t0 9.2% from 9.4% previously. We believe that new-asset acquisition newsflows could catalyse the stock. Axis REIT is now our top pick and only pick in the REIT sector, due to its more attractive acquisition outlook relative to the others.

KLCC Property - Earnings on track (MKE)

KLCC Property
Share Price: MYR5.57
Target Price: MYR6.25
Earnings on track

FY13 core pretaxprofit of MYR875.2m (+9% YoY) was within our expectations.
Unit price declined by 4.8%YTD but westillthink it is not the right time tobebold as the re-pricing of M-REITs could continue, especially in1H14amid volatile bond yields.
We finetuneour FY14-15 earnings forecastsby +5%.OurDCF-based TPis largely unchanged at MYR6.25 (-0.1sen). Netyield is6%for FY14, vsindustry averageof6.9%. HOLD.

Muhibbah Engineering -The story is still compelling (CIMB)

Muhibbah Engineering
Current RM2.53
Target RM3.05
The story is still compelling

Muhibbah's recent share price re-rating is a signal that the market has begun to price in the group's positive earnings prospects in 2014. We believe that the positive sentiment will be sustained in 2014. Our checks with management confirm our view that there should be a strong uptick in job flow in 1H14. The group's business model continues to capitalise on the domestic construction upcycle and oil & gas (O&G) spending spin-offs. Its construction order book will be replenished by the potential highway and port-related works, in addition to a possible O&G steel fabrication job (its first). We maintain our Add rating and target price, still pegged to a 30% RNAV discount. The realisation of strong order flows in 2014 will be catalysts for RNAV and EPS.
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)

乔治·索罗斯(George Soros)



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,
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