SG Market (29 Nov 13)

Market Roundup: US markets were closed for the Thanksgiving holiday on Thu but Asian and European stocks ended higher. In Europe, equities finished on a moderately positive note in thin volumes despite a Bank of England move to scale back mortgage lending. Asian stocks were led by Japan with the Nikkei hitting its highest level since 2007 after the yen slumped to a 6-month low, boosting shares of exporters on expectations of further monetary easing by the BoJ. Chinese stocks traded higher after Asia’s biggest economy reported a 15% jump in Oct industrial profits, outpacing the 13.5% increase in the previous month, while HK stocks lost steam in late session ahead of the US holiday. With no cues from US, The S’pore market may have to beat its own drum with the STI testing its immediate resistance at 3,190 level. Momentum and breadth indicators are pointing to a possible short term bounce towards the next objective at 3,230, capped by the 200-day moving average, while underlying support stays at 3,123. Stocks to watch: *Swissco: Secured $27m of charter contracts for 2 anchor handling tug and supply vessels. First vessel will deployed immediately for at least 12 months in Mid-East with a sale and purchase option exercisable after charter period, while second vessel will be deployed for 27 months in north-east Australia. *Centurion: Acquiring RMIT Village and adjoining car-park building in Melbourne for A$60m. Sited on a 4,000 sqm freehold land parcel, the accommodation is near to RMIT University and University of Melbourne anfd comprises 229 apartments and a current capacity of 456 beds. The car-park builing may be redeveloped into new apartment buildings for university students and staff working in the healthcare industry in the vicinity. *Oxley: Entered JV to develop 15.3-acre freehold agricultural land in Selangor, Malaysia into a proposed 900-unit residential project. Group will develop the land at its own costs and bear all state development charges up to maximum RM12m, with partner Peninsular Teamwork bearing 30% of any amount beyond the first RM7m. Peninsular will be entitled to 30% of project's gross development value of no less than RM200m or sgd77.7m. *Pteris: Acquiring balance 30% stake in Shenzhen CIMC-TianDa, a passenger boarding bridge manufacturer and operator from Shenzhen TGM for Rmb208.4m. The group has earlier proposed to acquire a 70% stake in TianDa from China Int’l Marine Containers for $96.3m in a RTO deal via issue of 107.7m 5-into-1 post consolidation shares at $0.65 each in a reverse takeover deal. *China Aviation Oil: Expands footprint in Europe with the setting up of new trading unit in UK. The London office aims to capture increasing trade flows from Asia Pacific to Europe and broaden its marketing opportunities to airline customers at designated European airports to enhance its trading activities. *Etika: FY13 net profit plunged 66.2% to RM7.4m on flat revenue of RM981.8m as bottomline was impacted by intensive competition, aggressive marketing effort to promote sales, FX loss of RM6.5m due to weakening of rupiah and higher tax charge. Gross margin improved 2 ppt to 22.8% mainly on reduced raw material costs of core dairy products. The group opened 6 "Texas Chicken" outlets in Klang Valley with another one in the pipeline slated for 1Q14. Final DPS of 0.2¢ has been declared. *Technics O&G: Dived to a net loss of $8.6m loss from $2.4m profit a year earlier as revenue sank 69% y/y to $7.7m due to the spin-off of Norr Offshore Group and unexplained drop in contributions from other units. The miserable results dragged FY13 to a net loss of $9.9m vs $20.2m profit in FY12. The group recorded a gross loss of $1.9m and other charges of $2.4m from bad debt write-offs in the 4Q. Net gearing was elevated to 0.5x from 0.3x in FY12. *Goodland: FY13 net profit came in at $17m (-31%) and revenue at $37.3m (-33%) with the declines attributed to the sales recognition from projects of lower value compared to those in FY12. The group booked revenue from Royce Residences, OneRobey, Suites@Topaz, The Shoreline Residences 1& II and 26A & 26C Poh Huat Road. NAV rose to 35.72¢ from 27.56¢. Final DPS of 0.5¢ was unchanged. *Nam Lee: FY13 net profit dropped 36% to $8.9m even though revenue climbed 10% to $170.8m due to increased sales from building projects but this was offset by a slump in gross margins to 15.1% from 22.6% as a result of higher cost incurred by a project, which has since been substantially completed. Final and special DPS of 1.5¢ has been proposed vs 2¢ the previous year.