SG Market (20 Oct 14)

S’pore shares are poised for a mini-recovery following Last Fri’s rally on Wall Street and more positive market opening in Tokyo (+2.6%) and Seoul (+1.2%). Technical indicators for the STI are also grossly oversold with the index expected to regain some lost ground and head towards topside resistance at 3,220 level. Downside support at 3,120 will most likely be safe for now. Stocks to watch: *CapitaMall Trust: 3Q14 DPU came in at 2.72¢ (+6.2% y/y), translating to an annualized yield of 5.6%. Revenue grew 2.9% to $164.6m, buoyed by higher contributions from Bugis Junction (post-completion of AEIs in 2013), as well as higher rental achieved on new and renewed leases and staggered rental. Net property income rose 3.3% to $114.1m. Gearing ratio at 34.1%. BVPS at $1.79. *Keppel T&T: 3Q14 net profit jumped 31% y/y to $18.5m, keeping pace with the 30% growth in revenue to $53.7m. Top line was driven by higher revenue from the Data Centre and Logistics divisions. Operating profit surged 122% to $11.4m due to higher revenue, unrealized hedging gain, distributions received from other investments and sundry income. The group will expand its logistics capabilities in Australia to manage a 10,000 sqm warehouse in Brisbane, Australia. BVPS at $0.91. *Guocoleisure: 1QFY15 net profit was flat at US$16.6m. Revenue fell 6.3% to US$101m due to lower revenue from the gaming and property development segments. Management notes volatility in the gaming segment will continue to affect revenue, while hotel revenue is expected to remain stable. Royalty income from Bass Strait increased 12.1% to US$13m mainly due to higher average crude oil prices. BVPS at US$0.905. *GuocoLand: 1QFY15 net profit fell 70% y/y to $27.0m, mainly due to the absence of a once-off gain from disposal of subsidiaries that led other income to plunge 93% to just $7.3m in the current quarter. Revenue dipped 4% to $223.6m, as revenue recognised from Goodowod Residence and Leedon Residence in Singapore was offset by lower revenue from Seasons Park in Tianjin, China. Nevertheless, gross profit soared 51% to $66.9m. BVPS at $2.44. *Keppel Land: Redeveloping the International Financial Centre Jakarta Tower 1 for Rp2,504b ($266.4m), which will more than double its net leasable area (NLA) to ~69,800 sqm of premium grade office space. *SMM: Secured two contracts worth $222m, comprising i) a design and build for an offshore substation platform, and ii) a repair and conversion of a VLCC into a FPSO vessel. *Ezion: First State Investment has raised its stake from 6.7% to 7.02%, via the purchase of 5.1m shares at an average price of $1.563 from the open market. *Vallianz: Clinched letters of award and new charter contracts with total value of US$64m for the supply of AHTS, PSV and barges for periods of up to three years, in Mexico, West Africa and the Asia Pacific region. Separately, Vallianz announced that an EBITDA target has been fixed in relation to its previously proposed US$27.7m acquisition of OER, a supplier of professional crew and related hospitality services to the offshore industry. The purchase consideration will be satisfied by the issue of 250m Vallianz shares at $0.14 each. *Geo Energy: Signed a cooperation agreement with PT Bandar Laut Biru for the management and operation of a port terminal in South Kalimantan for 15 years. Scope of services include the construction of a new conveyor belt, crusher and related facilities, as well as to provide periodic maintenance and repair services. *Bumitama Agri: 3Q14 production stats. 1) Total FFB production: 649k mt (+15.4% y/y), 2) CPO production: 151k mt (+18.6%), 3) Palm kernel production: 27.8k (+15%). *Spackman: Buying a 46.4% stake in Breakfastfilm for KRW1.3b. The target is a leading marketing and media company that specializes in the production of TV/new media commercials and K-pop music videos in Korea. *China Sunsine: Positive profit alert. Expects a substantial increase in 3Q14 net profit due to an increase in both average selling price and sales volume of products. *TIH: Completed the $129m acquisition of assets from Temasek, comprising a minority interest in CEI Contract Manufacturing and minority interest in Mitsui Life Insurance. *Innotek: Substantial shareholder, Gazelle Capital has informed that it will not proceed with any transaction at this time. Gazelle was previously in discussions regarding a transaction that may or may not result in an offer for Innotek shares.