Thursday, September 10, 2015


SGX: Despite policy deleveraging in China, including curbs on CFFEX trading, SGX’s A50 story is unlikely to fade in FY16, as mainland fund managers look offshore to manage risks arising from a volatile domestic equity market.

Moreover, policy-makers seem likely to delay the internationalization of CSI300 futures, implying SGX A50 growth moderation only from FY17. As the cash market shows signs of revival, with August ADT at a two-year high of S$1.5bn, Deutsche is confident that SGX could report average EPS growth of 9% over the next four years, along with dividend yield >4%.

House retains Buy on a reduced TP of $9.40.

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