SG Market (03 Feb 15)

Singapore shares are likely to open higher, following overnight gains in Wall Street, which was led by a rally in energy producers and phone shares. Asian shares are mostly higher this morning, led by Tokyo (+0.4%) and Sydney (+0.5%), but Seoul opened flat. From a chart perspective, the STI recouped all of Fri’s index-liniked losses yesterday although broader market was weak with declining stocks outpacing advancing ones by 1.5 to 1 ratio. Topside resistance for STI remains at 3,465 with ubnderlying support at 3,377. Stocks to watch: *Guocoleisure: 2QFY15 profit climbed 8.0% y/y to US$14.8m, taking 1HFY15 net profit to US$31.4m (+4.0%). Revenue fell 6.7% to US$99.6m due to gaming volatility and lower contribution from property development, although bottom-line was aided by a 5.7% drop in raw materials and consumables costs to US$48.2m and a 12.1% drop in personnel expenses to US$28.3m. Going forward, management guided that "Every" brand of hotel is on track to launch in 1Q15 but ongoing asset enhancement will impact rooms available. Oil royalties, paid a quarter in arrears, may be reduced due to lower oil prices and weaker AUD. NAV/share lower at US$0.865 (from US$0.933) due to share dilution. *IPC: FY14 net profit soared 57.1% to $28.6m, although revenue fell 28.9% to $33.4m, as majority of Oppama condominium project were sold in 2013. Bottom line was boosted by $22.7m of revaluation gains from investment properties in Japan and $14.8m gain from the disposal of investment properties in Japan. Final DPS of 0.25¢ and special dividend of 0.35¢ declared. (FY13, final DPS: 0.25¢, special DPS: 0.10¢. *OKP: Has been awarded the tenders for Contract ER442 and Contract ER443 under the Walk2Ride Programme by LTA. The contracts are worth $143.9m, and will commence on 2 Feb '15 and is estimated to be completed by Dec '18 and Feb '19, respectively. *BBR: awarded 99-year land parcel at Yishun Ave 4 for $185.1m via a 50.1% stake in a consortium with three others. The proposed development consists of 200 residential units and other commercial shops and amenities. *Low Keng Huat: Acquiring 20% equity interest in AXA Tower for $365m, based on the property value of $1.17b ($1,735 psf). Low Keng Huat will subscribe for $75.6m share of investment securities issued by the SPV acquiring AXA Tower via external borrowings. *Sakae Holdings: Newly established corporate advisory segment hosted the 2015 EMPEA reception, an association for private capital in emerging markets, with over 70 members present. Management highlighted its natural progression into asset management and is looking to start a ~$250m opportunistic fund. Two companies that have recently engaged the group includes Q&M Dental and Giken Sakata. *Vallianz: Acquiring 100,000 shares, representing 100% of the equity interest in Jubilee Travel (JT), for $100,000. The principal activity of JT is that of provision of air-ticketing and tour services. The purchase will be funded by internal resources. *SMJ: Expects to report lower net profit for FY14