Thursday, January 22, 2015

SG Market (22 Jan 15)

Singapore shares are likely open higher, tracking the gains on Wall Street, as investors await the highly anticipated ECB decision on its asset purchase plans. Asian markets opened this morning with Tokyo (+0.1%), Seoul (+0.4%) and Sydney (+0.7%) all in positive territory. From a chart perspective, the STI may attempt to test the topside resistance of 3,375 in the nest few days with critical support at 3,288. Stocks to watch: *Land Transport: PTC has approved an overall 2.8% fare hike from Apr for transport operators, lower than 2014’s 3.2%. This will raise SBS Transit and SMRT’s annual revenues by $16.4m and $18.6m respectively after netting Public Transport Fund contributions. *SGX: 2QFY15 net profit rose 15.5% to $87.6m, while revenue rose 18.6% to $195.1m, driven by a 45.6% increase in derivatives revenue to $76.4m on the back of a 183% surge in China A50 futures volume. This was offset by a 1.1% decline in securities revenue to $51.7m. Daily average value rose 4%, but the dip in revenue was due to a drop in clearing fees to 3.0bps (-0.1bps). Management expects to incur $3-4m expenses for the Nov’14 trading disruption. 4¢ interim DPS maintained. . *Mapletree Commercial Trust: 3QFY15 DPU rose 11.5% y/y to 2.08¢, while distributable income rose 13% to $43.8m. Revenue rose 6.5% to $72.9m while NPI increased 10.7% to $54.7m, thanks to positive rental reversions and lower utility and marketing costs, offset by property taxes. Portfolio occupancy increased 1ppt to 99.5%. Aggregate leverage held steady at 37.9% with all in interest cost of 2.18%. BVPU at $1.17. *Ascott REIT: 4Q14 DPU surged 62% y/y to 2.16¢, while distributable income rose 26% to $33.1m, buoyed mainly by one-off items and a right-issue adjustment in 2013. Otherwise, DPU improved 13.4% to 1.76¢. Gross revenue and gross profit edged up 13% and 10%, respectively, boosted by additional contribution from nine properties acquired in 2014, as well as stronger performance from existing properties, notably in the UK. RevPAU slipped 4% to $124/day, dragged by weaker performance from properties in S'pore and Vietnam, as well as lower ADR in China. Aggregate leverage fell 1.5ppt q/q to 38.5%, as debt tenor increased from 3.8 to 4.4 years, at average borrowing rate of 3.0%. BVPU of $1.37. *Fortune REIT: FY14 DPU rose 15.8% to HK41.68¢, while distributable income rose 21.5% to HK$780.8m. Revenue increased 25.7% to HK$1.7b, while NPI rose 25.1% to HK$1.2b, its strongest growth since 2006, thanks to record rental reversions and full year income from Fortune Kingswood (accounting for 18.4% of NPI growth). Occupancy dipped 1.4ppt to 97.3% due to frictional vacancies resulting from AEI works at Belvedere Square. Aggregate leverage stood at 29.4% with all in interest cost of 2.17%. BVPU of HK$11.93. *Soilbuild REIT: 4Q14 DPU rose 5.0% y/y to 1.59¢, while distributable income rose 6.1% to $12.9m. Revenue rose 8.3% to $17.7m, while NPI increased 9% to $14.9m, thanks to additional revenue from new factories, KTL Offshore and Tellus marine, as well as higher rents from Solaris, West Park BizCentral and Tuas Connection. Full portfolio occupancy, with WALE of 4 years. Aggregate leverage stood at 35.4% with all in interest cost of 3.19%. BPVU at $0.80. *Sabana REIT: 4Q14 DPU fell 18.7% y/y to 1.78c, taking FY14 DPU to 7.33c (-21.9%). The drop in bottom-line was largely due to an increase in units issued for the Trust’s partial payment for the acquisition of 10 Changi South Street 2 in units. Gross revenue for the quarter inched 1.9% to $25.3m, although NPI fell 8.6% to $18.2m, dragged by higher property tax, maintenance, utilities, and applicable land rent expense, and lease management fees being charged to 15 properties acquired during IPO, following the expiry of the three-year waiver period in 4Q13. Portfolio occupancy was at 90.7%, with WALE at 2.5 years. Aggregate leverage of 38%, with average interest cost of 4.1%. BVPU of $1.06. *Rex: 65%-owned Lime Petroleum is awarded, via a 5% stake in a partnership, license for PL591C, an extension of PL591 which the partnership already owns and is scheduled for drilling in mid-2015. *Sakae/ Giken Sakata: Sakae Corporate Advisory has been engaged by Giken Sakata to be its corporate adviser. *ISDN: Inked agreement to acquire 49% of PT Izmi Power Mandiri for 3.9b rupiah ($0.3m). PT Izmi has a power purchase agreement to build, own and operate an 8MW mini-hydroelectric power plant in North Sumatra. *Spackman: indirect wholly-owned subsidiary, Zip Cinema, will begin filming new movie Black Priests by Feb 2015, starring Gang Dong-won and Kim Yoon-seok and directed by award-winning Jang Jae Hyun. Management guides another six films to be released in 2H15-1H16. *Oxley: Terminated the main contract for the construction of Devonshire Residences wef 6 Jan as the main contractor Admin Construction is facing winding up action. Group has appointed another contractor to complete the project.

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