SG Market (09 Feb 15)

Singapore shares could see some profit-taking following Wall Street’s retreat on Fri, as sentiment may be weighed by fears of an earlier interest rate hike in US, renewed worries about Greece and a slump in China’s Jan trade performance.
Asian shares are mostly trading lower this morning, led by Seoul (-0.4%) and Sydney (-0.3%), with Tokyo (+0.8%) is bucking the trend.
From a chart perspective, topside resistance for STI is seen at 3,465 with underlying support at 3,377
Stocks to watch:
*SIA: 3QFY15 net profit soared 230% y/y to $202.6m, primarily driven by the consolidation of Tigerair, which resulted in $56m exceptional net gain, compared to an $80m one-off loss last year. Overall, revenue grew 5.8% to $4.1b and operating profit rose 3% to $147.0m, as passenger yields improved by 2.7%, offsetting the 0.6% dip in traffic. SIA’s unit jet fuel price eased only 1.9% despite market prices plunging 26.2%, as a result of higher priced fuel hedges. NAV/share at $10.46

*HPHT: 4Q14 swung to a net loss of HK$18.6b from a net profit of HK$334.8m, due to HK$19b impairment on goodwill allocated to CGU in HK as it is adversely impacted by various challenges. Excluding the impairment charges, net profit would have been higher at HK$390m (+16.5%), taking FY14 net profit to HK$1.8b (+8.0%). Revenue rose 2.2% to HK$3.2b, as throughput at HIT which decreased 1% due to weaker intra-Asia cargoes were offset by higher transshipment volume. Yantian Terminals throughput increased 9.2% due to US and empty cargoes transshipment growth. Final DPU of HK$0.223 maintained. NAV/unit at HK$5.09.

*Ascendas Hospitality Trust: 3QFY15 DPU fell 19.3% y/y to 1.3¢, while distributable income dropped 12.9% to $14.5m, weighed by higher finance costs, unwinding costs for AUD/SGD cross currency swaps, and FX losses. Revenue climbed 5.2% to $59.6m and NPI was up 9.1% to $25.5m, led by the consolidation of Osaka Namba, and the improved contributions from Australia and Singapore hotels. Aggregate leverage stood at 38.9% (+0.6ppt q/q), with weighted average interest rate of 3.2% (+0.1ppt q/q). NAV/unit at $0.69.

*Yoma: 3QFY15 net profit surged 50% y/y to $7.8m, boosted by lower non-controlling interests (-89%) from a repayment of shareholders' loan, as well as FX gains ($3.2m). Revenue declined 17.2% to $25m, from lower sales recognition from Star City, partially offset by stronger sales at Pun Hlaing Golf Estate (PHGE), rental income from PHGE and Star City, as well as higher contributions from its non-real estate businesses. NAV/share at $0.38.

*LCD Global: 2QFY15 net profit reversed into a net profit of $10.0m versus a net loss of $0.2m from the previous year, due to a more than 16x rise in associate and JV contributions at $10.7m, from the group’s JV company in Xuzhou, China, where profit of 463 apartment units were recognised during the quarter. Revenue was down 6% to $14.0m, as a result of a decline in revenue from the group’s serviced residences (-12%) and leisure and others (-46%) business segments. NAV/share at $0.27.

*Singhaiyi: 3QFY15 slumped 37.0% y/y to $2.5m, on the back of 69.4% drop in revenue to $4.1m due to absence of property development income. Gross margin jumped to 63.5% from 37.9%, mainly due to the contributions by US projects. Bottom-line was aided by $2.8m FX gains, offset by increases in operating costs and surge in interests payable due to $100m debt at 5.25%. NAV/share at $0.15.

*Falcon Energy: 3Q15 net profit rose 7.4% y/y to US$6.5m on revenue of US$131.4m(+193.4%). Top-line was led by an 86.6% surge in revenue from the oilfield services division, driven by engineering, procurement, construction and commissioning (EPCC) contracts. Gross margin halved at 13.3%, as a result of lower margin from EPCC contracts. NAV/share at US$0.33.

*Keppel Corp/ Sembcorp Marine: Companies separately refute allegations on any involvement in the scandal surrounding oil giant, Petrobras.

*Cache Logistics Trust: To acquire three freehold distribution warehouses in Australia for A$75.6m ($79.3m), which will be 100% leased to high quality tenants such as McPhee Distribution Services, Linfox Australia and Stirling Holdings for a long WALE of 9.7 years with fixed annual escalations of 3.0%-3.5%. The warehouses are located at Chester Hill (NSW), Somerton (VIC) and Coopers Plains (QLD). The acquisitions will be debt-funded, with aggregate leverage ratio expected to rise from 31.2% to 35.7%.

*Europtronic: Non-binding agreement to acquire Kampac Oil Middle East FZCO, an international oil & gas company which trades in crude oil and refined products- gasoline, gas oil, jet fuel, fuel oil and liquefied petroleum. Kampac recorded net profit of US$36.5m in FY13 and has a NAV of US$443.3m.

*IEV: Obtained an exclusive 5-year master license for the Oxifree corrosion control technology for Indonesia from USA-based licensor, Oxifree Global. This is the fourth country in ASEAN for which IEV has acquired the exclusive rights to distribute, apply and maintain products utilising the technology.

*Otto Marine: Secured contracts to charter two PSVs to a global oil major in Australia for 36 months including options for ~A$80m, to begin in March – April, bringing latest order book to US$400m as at Jan ’15.

*Soilbuild: Awarded $25.9m contract to design and build 8-storey single-user E-commerce Hub at Tampines North.

*TriTech: Awarded $4.92m water quality profiling contract by PUB, at 33 locations commencing Feb. Expected completion date is 11 Nov ’19.

*Sakae Holdings: Will provide corporate and advisory services to Frankfurt-listed Snowbird, which produces and processes down of different grades, after the latter engaged Religare Capital Markets for a proposed secondary listing on SGX.

*Genting HK: Issued profit guidance for FY14 net profit, where excluding share of results of NCL and Travellers Int’l, the group is expected to record a net profit of not less than US$235m in FY14 versus US$483m recorded in FY13.

*MDR: Issued profit warning for FY14 that the group expects a net loss, resulting from goodwill impairment of certain of its investments, and provision for restructuring costs, slow-moving inventory and doubtful debts.

*Hiap Hoe: Issued profit warning for FY14 that the group expects a net loss