SG Market (05 Feb 13)

SG Market: S’pore shares are likely to reverse its uptrend after the Wall Street slide on renewed European concerns. Near term support for the STI seen at the 20 dma at 3240 with overhead resistance at 3300. Among stocks in focus: *Wing Tai: 2QFY13 results beat estimates with net profit +159% yoy, +23% qoq to $88.7m (1HFY13: $160.7m vs FY13 estimate of $165m) underpinned by progressive bookings of Foresque Residences and L’VIV as well as additional units sold in Helois Residences and Belle Vue in S’pore and higher contributions from HK associate. NAV stood at $2.95 with reduced net gearing of 0.16x. *Sim Lian: 2QFY13 net profit climbed 35% to $47.5m on revenue growth of 64% to $208.3m, mainly driven by higher contributions from several development projects, while construction revenue declined. Book NAV inched up to $0.773; net gearing improved from 0.44x to a comfortable 0.14x. *United Environtech: Robust 3QFY13 results with net profit soared 350% to $8.5m as revenue surged 159% to $52.3m. This brought 9M13 net profit to $22.5m (+146%) on revenue of $138.2m (+109%). Prospects remain bright given the growing demand for membrane based water and wastewater treatment services amid more stringent environmental standards in China. *Silverake: 2QFY13 net profit rose 10% to RM49.3m even as revenue declined 8% to RM100.6m due to lower sales of software project services, which was partially offset by higher margin software licensing and maintenance revenue. *China Essence: Weak 3QFY13 results with net loss widening to Rmb212m as revenue dived 58% to Rmb246m due to reduced production levels and lower selling prices for its products, citing bad weather for damaging its potato inventory and reducing the starch yield. The group is currently in discussions with its bondholders to postpone repayment of HK$30m of its CBs due Dec 12 and with its bankers for refinancing of US$38.5m term loans. *Global Logistic Properties: GLP and Canada Pension Plan Investment Board will jointly invest an additional US$632m to expand their Japanese logistics-property JV, taking their total investment target to US$2.2b. *Technics O&G: Awarded $6.6m EPCC contracts from Vietnam and Thailand for supply of compressors. *Huan Hsin: Warns of widening loss for FY12 due to the sustained economic weakness in Europe and US and intensified competition, which would lead to a substantial jump provisions and impairment charges. *XHM: Proposed acquisition of JTC land for $8.1m to house new facilities. *Straits Trading: Following the disclosure that its shares in public hands has dropped to 9.1% after a share swap with Aberdeen and Third Avenue for WBL shares, SGX has granted the company a time extension till 1 Jun to restore its public float to above 10%. *SGX: FT reported that SGX is in talks to take a stake in European clearing house LCH *Keppel Corp: BlackRock disclosed its 5% stake, becoming a key substantial shareholder.