SG Market (17 Jan 14)

Market Roundup: US stocks snapped a two-day rally on bad corporate news from the big banks and economic data that generally met expectations. Electonics retailer Best Buy was the biggest loser in the S&P 500, tumbling 28.6% after the electronics retailer reported disappointing holiday sales. Citigroup sank 4.4% after its 4Q earnings missed estimates, while Goldman Sachs fell 2% after its 4Q profits were hit by declining trading revenue. Rail operator CSX slumped 6.8% as profit missed estimates for the first time in two years. Intel slid 2.6% in extended trading after forecasting sales that may fall short of expectations. In economic news, initial jobless claims slipped 2,000 to 326,000 last week. Separately, consumer prices climbed 0.3% in Dec, the most in six months, led by gains in fuel and rents. The S’pore market is still not making any headway with the STI struggling between between a tight trading range between resistance levels at 3,180 and 3,200 and downside supports at 3,120 and 3,100. Stocks to watch: *SMRT/ComfortDelgro: Public Transport Council has approved its highest-ever fare hike of 6.6% for bus and train fares, with 3.2% to take effect on 6 Apr and balance 3.4% to be rolled over to next year. The fare adjustment is expected to bring in additional revenue of $53.5m for transport operators ($36m for SBS Transit and $17.5m for SMRT), of which $11.6m ($7.2m for SBS Transit and $4.3m for SMRT) will go to Public Transport Fund to help needy communters. Existing concessions will be enhanced and coupled with new concession schemes, expected to benefit ~500,000 of the current 1.2m concession holders. *Yoma: 3QFY14 net profit jumped 42% y/y to $5.2m, while revenue hit $30.2m (+133%), underpinned by its real estate segment ($27.2m), of which sales of residences contributed $11m and land development rights $16.2m and maiden contributions from its Bagan hot air balloon business. As at Dec ‘13, almost all of the 528 units in Star City’s Buildings A3 and A4 have been sold, amounting to $60.9m, of which $45.9m of sales is expected to be recognized within the next 12-18 months. For 3QFY14, group also sold 150 units and received booking deposits for 55 units of its Star City Zone B apartments. NAV/share improved marginally to $0.314. *Cambridge Industrial Trust: 4Q2013 distributable income rose 3.8% y/y to $15.5m, while DPU inched up 1.8% to 1.251¢. Gross revenue dipped 3.1% to $23.3m, while net property income shrunk at a faster clip by 8.7% to $19.0m due to divestment of four properties in FY13. Full year FY13 distributable income grew 6.4% to $61.3m, giving DPU of 4.976¢. Occupancy is a healthy 97%. Gearing is low at 28.7% with 83% of debt fixed for next two years. With a NAV of 69.5¢, annualized 4Q13 yield is 7.2%. *Int’l Healthway Corp: Exploring the establishment of a healthcare REIT to be listed on SGX Main Board. The properties forming the portfolio of the REIT, terms of injecting the properties into the REIT, pricing and size of the IPO are still under review. *Ezra: Appointed JPMorgan to advise on strategic options, aimed to optimize the international profile and competitive position of its subsea services division, EMAS AMC. Potential options include a listing in the US. The co remains committed to the business and the review is intended to unlock value for shareholders and to enhance access to capital. *City Dev: Appointed Grant Kelly as the new CEO. Kelly, who will assume duties from next month, last headed the Asia-Pacific real estate at private equity fund Apollo Global Management. Chariman Kwek Leng Beng believes Kelly’s experience managing hotel assets will help City Dev diversify, and be useful in running the firm’s Millennium & Copthorne Hotels arm. *Aspial: Its retirement resort, the 281-unit The Hillford at Upper Bukit Timah, will open for booking today. Prices for the 60-year leasehold project range from $388,000 for a 398 sf one-bedder to $648,000 for a 653 sf two bedroom dual-key unit. *Sysma: Exercised an option to purchase a property at Gul Lane with a leasehold factory on a 8,300 sqm site for $12.3m. The property will serve as an office as well as storage and warehousing plant to support its refined petroleum product business. The acquisition will be funded through bank borrowings and internal resources. *ASL Marine: Fidelity purchased 1m shares @ $0.71 on 14 Jan, raising its stake from 6.96% to 7.2%. *EuroSports Global: Trading debut at 9am today after IPO tranche of 80m shares at $0.28 each was 2.9x subscribed. Notable investors include Han Seng Juan with 6m shares (2.3%) and both Kwek Leng Joo and Lim Soon Fang with 4m shares each (1.5%).