Jardine Group

Jardine Group: announcing their 2Q results on 1st August, Friday. There are five Jardine group companies listed in Singapore: Ultimate parent company Jardine Matheson Holdings (JMH 4000USD, J36.SI), investment holding company Jardine Strategic Holdings (JSH 500USD, J37.SI), auto distribution company Jardine C&C (C07.SI), retail company DairyFarm Int’l (D01.SI) and property investment company HongKong Land (H78.SI). JP Morgan expects no upside surprise in earnings. Good profitability but expectantly high currency translation losses are likely to weigh on profits higher in the Jardine chain. JPM expects earnings results to be better down the Jardine Group chain as profit contribution to companies higher up the chain may be eroded by weak IDR this year. JP Morgan reiterates OVERWEIGHT on JMH with an upward adjustment in TP from $60.00 to $62.50. JMH is valued for its high-quality, diversified exposure to growth in emerging Asian economies. At the same time, the house also reiterates UNDERWEIGHT on JSH despite upward adjustment of TP from $30.00 to $34.00 as JSH is currently trading above TP. JSH is less favoured for its significant cross-holding with JMH. It is usually difficult to put an accurate number to see-through value in a complex group structure like Jardine Group. Jardine C&C had its TP reduced from $51.00 to $50.00 but JPM maintains OVERWEIGHT rating on the company with 8.5% upside. Jardine C&C is liked for its P/E discount to Astra, making it a good proxy to gain cheaper exposure to Astra.