SG Market (28 Jan 16)

rom a chart perspective, downside risk for the STI at a 5-year low of 2,520, while topside resistance remains pegged at 2,670.

Stocks to watch
*Reits: Managers advised to consider share buybacks amid the sector's depressed valuations, instead of dishing out funds for new acquisitions.

*Mapletree Commercial Trust: In line 3QFY15, with DPU flat y/y at 2.08¢, while distributable income inched to $44.2m (+ 1.1%). Revenue climbed to $73.8m (+1.2%), while NPI rose to $56.6m (+3.5%), on positive contributions from VivoCity, but partially offset by lower revenue from Mapletree Anson and PSAB, as well as lower utilities expenses. Portfolio occupancy grew to 98.4% (+1.5ppt q/q) with WALE of 2.3 years. Aggregate leverage remained steady at 36.3%, with weighted average cost of debt at 2.47% (2QFY15: 2.4%). Separately, the REIT will embark on an AEI for VivoCity to strengthen its F&B offerings, expected to start in 4Q16 and completed by 1H17. NAV/share at $1.24.

*K1 Ventures: 2QFY16 turned into net loss of $8.5m (2QFY15: +$31m), as revenue crashed to $13.6m (-74% y/y) due to the sale of China Auto, partially offset by higher investment income. Bottom line was weighed by an FX loss ($17.6m) upon the voluntary liquidation of Focus Up Holdings, and absence of a gain from sale of China Auto ($27.4m). Management cited that the group will not be making any new investments, but will focus efforts on managing and realising current investments. Declared interim DPS of 21¢ (2QFY15: 7.5¢). NAV/share at $0.64.

*Genting Singapore: Negative read-through from MBS 4Q results, which saw adjusted EBITDA tumble 35% y/y to USD338.2m on weak VIP and hotel segments.

*Lantrovision: Proposed exit offer by listed-Japanese telco construction engineering and services group MIRAIT by way of a scheme of arrangement at $3.25/share. Shareholders comprising 39.4% share capital have given their irrevocable undertakings on the offer.

*Keppel Corp: Selected to supply LNG bunker to vessels in the Port of Singapore. A 50:50 JV with BG Group will be set up for operations expected to commence in early-2017.

*SGX: Partnership with Taiwan Stock Exchange for SGX to become a remote trading member. TWSE member brokers will be able to directly trade SGX-listed securities via Global Link when it goes live in 2Q16.

*UMS: Buying 10% equity of All Star Fortress for RM145,000, an aerospace metallic component manufacturing company, to diversify beyond its traditional semiconductor business. UMS will also extend secured, interest-bearing convertible loans up to US$7.5m to All Star.

*QT Vascular: Proposed issue of 8% exchangeable bonds and convertible bonds due 2017/2018 to Luminor Pacific (US$1.9m) and 10 individual subscribers (US$4.2m) , exchangeable into 65.3m new shares (7.1% enlarged share capital). The fund raising of US$6.1m is intended to strengthen the financial position of QT and have more resources to develop its drug coated chocolate platform, as well as payment of expenses incurred with the ongoing litigation by AngioScore.

*Mercator Lines: Sold five vessels to related companies of syndicate lenders at market value of an aggregate US$32.3m.

*EMS Group: Secured contracts worth $2.8m to construct a sewerage treatment plant at the Vietnam Singapore Industrial Park. In addition, the group has been awarded three other sewerage treatment contracts worth an aggregate $1.7m in Jan '16.

*Liongold: Clarified the content of an article in the Edge that John Soh is an adviser to its Chairman, but not to the group itself.

*Tat Hong: Expects to report a 3QFY16 loss due to costs and provisions from the exit of the excavator distribution business in Indonesia, weak performance in Australia and FX losses. Results expected to be released after market on 12 Feb.