CS 3Q13 Report card

CS 3Q13 Report card: After a few disappointing quarters, CS noted that 3Q13 was a better one. Of 56 companies covered, 27% had positive surprises while 32% disappointed.Aggregate net margins of these covered stocks increased about 1 ppt q/q to 8%. Drivers for earnings beat as follows: DBS: Surprised due to continued strength in non-interest income and stable NIMs and credit cost. OCBC: Stable margins, supported by a surprise from Great Eastern’s strong MTM portfolio gains SGX: Better mix and cost control HLF: Lower than expected credit cost Amtek: strong revenue growth CD: Strong overseas bus contribution M1: PAT ahead of expectations First Resources: Improvement in palm oil revenues NOL: smaller-than-expected loss on an FX gain, and better logistics contribution However, consensus earnings for MSCI SG 2013 and 2014 continues to be downgraded. CS estimates largest cuts was in transport, cap goods, media and commodity. CS likes DBS (O/PF, TP: $19.00) and Keppel (O/PF: $12.90)