SGX

SGX: DB maintains HOLD rating, but increases TP to $7.90, based on 23x forward P/E. House notes that average daily turnover (ADT) dipped in Feb 2013 to $1.64b, but still respectable given the CNY break and high y/y base effect. Velocity declined to 42%, from 45% in January. YTD FY13 ADT has averaged $1.36b, implying it must average c. $1.68m for the final four months of FY13 to hit its $1.47b forecast – still achievable if the current 2013 run-rate is maintained. Derivatives recorded another strong month of growth with average daily contracts traded rising to 482k (+69% y/y, +7% m/m) – the 3rd consecutive month high. Equity options volume more than doubled y/y – led by growth in Nikkei 225 index options. DB upgrade its derivatives turnover assumptions by 12-17% over FY13-15F, reflecting the progressive growth which continues to outpace its expectations, as well as the SGX’s commitment to growing this business. SGX has seen earnings upgrades within the past 4 weeks. 2 brokers have increased their FY13e EPS by 1.0%.