SG Market (22 Jan 13)

SG Market: S’pore shares are likely to nudge higher after European stocks edged up after Germany’s central bank delivered an upbeat assessment of its economic outlook but the moves were muted with US markets closed for a public holiday. The STI could attempt to re-test its recent high of 3238 with the 20-day moving average acting as the immediate support at 3200. Among stocks in focus, F&N could trade down towards to $9.55 offer price tabled by Thai tycoon Charoen Sirivadhanabhakdi after OUE pulled out of the takeover battle, citing the recent property cooling measures no longer make any significant increase in bid price attractive. Attention could now switch towards possible restructuring plans to split the F&B and property businesses with ThaiBev. The unveiling of the $2b Marriage & Parenthood package by the govt to reverse S’pore’s low birth rate make spell new opportunities for cord blood bank Cordlife. KSH could also see some interest after bagging a $142m contract for Q Bay Residences. In corporate results, M1 reported flat 4Q earnings that were slightly below par, due to higher than expected handset costs and tax expenses and proposes a final DPS of 6.3¢ and special DPS of 1.7¢, bringing total DPS to 14.6¢ vs 14.5¢ for FY11. Keppel Reit’s 4Q results was in line, as NPI and distributable income rose 85% and 45% respectively, underpinned offering by the additional 12.4% stake in OFC, 50% stake in 8 Chifley, higher occupancy and tax savings from MBFC. DPU of 1.97¢ brings FY11 DPU to 7.77¢, offering a 7.3% yield. Cache 4Q results were steady with FY12 dstributable income +9.5% yoy and NPI +11.7% yoy. 4Q DPU at 2.154¢ takes full year DPU to 8.365¢, +1.6% yoy for a 6.7% yield.