SG Market (14 Jul 15)

Singapore market is likely to open in positive mood after a risk-on sentiment took hold of Wall Street as the Greek crisis draws towards a resolution.

Regional bourses are mostly up this morning in Tokyo (+1.7%) and Sydney (+1.6%), with Seoul (-0.1%) slightly off.

Stocks to watch:
*Economy: Tepid 2Q15 GDP growth of 1.7% y/y came below street estimates of a 2.4% gain, weighed by the contraction in manufacturing sector (-4%) due to lower export demand to China, which offset the increases in construction (+2.7%) and services (+3%) sectors.

*Keppel Corp: Secured a US$85m contract from Crystal Heights to build a high spec liftboat, scheduled for delivery in 4Q17. Subsequently, the vessel will have provisions enabling it to operate in China, Middle East, and the Gulf of Mexico.

*Second Chance: 3QFY15 net profit slipped 7.4% y/y to $4.0m, on lower revenue of $10.5m (-2.7%), bringing 9MFY15 earnings to $8.2m (-24.6%) and revenue to $29.5m (-3.6%). For9MFY15, top line was dragged by its apparel (-15.9%) and property (-8%) segments, partially mitigated by a 36.2% gain in securities, while gold remained flat. Gross margin improved 4ppt to 61.2%, while a drop in overall operating expenses (-3%) and a $1m fair value gain in properties was not enough to offset the impact of fair value losses of financial assets of $3m (9MFY14: $1.8m). NAV/share at $0.383.

*Metro Holdings Limited: Wholly-owned Zensei Tokutei Mokuteki Kaisha will divest Frontier Koishikawa, a 9-storey office building in Tokyo, for ¥5.22b ($57.7m). The building is group's only property in Japan and the divestment is part of its plan to rationalise the geographical spread of its property portfolio. The deal is expected to result in a divestment gain of $4m.

*Heeton/ KSH/ Lian Beng/ Ryobi Kiso: Forming a 55:15:15:15 JV to acquire 2.45 acres (106,722 sf) site near Leeds City Centre for a 1m sf mixed-use development. The development marks the consortium’s second venture in UK and is intended to be a long term project, launched in phases.

*Equation Summit: JV partner tech solutions provider Citrine Wireless inked a deal with two Chinese firms to develop applications, WeChat service number technology as well as data collection and processing for the digital entertainment segment.

#Digiland International, in an effort to accelerate its transformation into an oil and gas company, has renamed itself as New Silkroutes. In addition, the company has appointed a new CEO and aims to boost its market value to US$150m within a year.

*Singapore Windsor: Proposed placement of 11.3m new shares at $0.3555 apiece to two individuals, Quah Suat Lay Nancy (5.6m) and Esther Seet Kheng Neo (5.6m). Net proceeds of $3.9m is intended to fund the construction of telecommunications towers for Ooredoo Myanmar and general working capital.

*Epicentre: Terminated the proposed RTO of Healthtrends Medical Investments.

*Stratech: Applied for removal from SGX Watch-list following its recent FY3/15 earnings of $0.7m.

*TalkMed: Officially opens the Hong Kong Integrated Oncology Centre and Hong Kong Integrated Imaging & Endoscopy Diagnostic Centre. The two-storey out-patient cancer centre offers a comprehensive range of diagnostic, treatment and support services.

*CNA Group: Applied to be placed under judicial management following the receipt of a statutory demand for winding-up by Kele & Associates for $175k.

*CosmoSteel Holdings: Profit warning for 3QFY15 and rest of FY15 due to sluggish market conditions and lower profit margins, which are insufficient to cover its fixed operating costs.