SG Market (25 Apr 16)

SG Market: Investors are expected to stay at the sidelines ahead of US FOMC meeting on Wed and BoJ policy statement on Thu.

Regional bourses opened in the red in Tokyo (-0.3%), Seoul (-0.1%) and Sydney (-0.7%).

From a chart perspective, support for the STI is at 2,890, with immediate resistance at 2,960.

Stocks to watch:
*Raffles Medical: 1Q16 net profit of $15.5m (+3.7% y/y) came within estimates. Revenue jumped 23% to $116.9m, with half the growth contributed by newly acquired medical assistance company International SOS, as well as increased patient load, greater patient medical needs and incremental sales contribution by more specialist consultants. MKE maintains BUY with TP of $5.20.

*Starhill Global REIT: Flat 3QFY16 DPU of 1.26¢ was in line. Revenue jumped 12% y/y to $53.6m on maiden contributions from Myer Centre Adelaide acquired in May ’15, while NPI grew at a slower clip to $41.6m (+7%), dampened by higher property tax (+44.4%). Portfolio occupancy dipped to 95.6% (-2.6% q/q) dragged by poorer occupancy at its Australian properties (-6.7 ppt). Net gearing remained at 35.4% (-0.3ppt q/q) with average cost of debt at 3.15%. NAV/unit at $0.90.

*Cache Logistic Trust: 1Q16 met estimates with DPU of 2.04¢ (-5% y/y), diluted by an enlarged unit base. Revenue surged 32.7% to $27.9m from new Australian acquisitions and maiden contribution from a recently completed BTS development in Singapore. NPI rose slower to $22m (+12%) on higher property expenses from newly converted multi tenanted properties. Portfolio occupancy was 94.2% (-0.7ppt q/q), with WALE of 4.3 years. Aggregate leverage was stable at 39.6%, but average debt cost increased to 3.69% (+0.44ppt) with debt tenor of 2.9 years. NAV/unit at $0.88.

*Yeo Hiap Seng: 1Q16 net profit slumped 41% y/y to $5.4m, eroded by increased FX losses (+51.2%). Revenue slipped 8.6% to $111m, while gross profit margin contracted to 38.2% (-1.5 ppt) on higher raw material costs.

*Baker Tech: Swung to 1Q16 net loss of $2.8m (1Q15: $6.4m profit) due to $2.6m FX loss, while revenue plunged 79% y/y to $6m on the slowdown in the oil and gas industry. NAV/share at 22.3¢.

*Sembcorp Marine: Initiated arbitration proceedings against Sete Brasil after Sete shareholders approved a resolution to file for bankruptcy. Sembcorp believes its $329m in provisions for Sete contracts are sufficient.

*Bumitama Agri: 1Q16 CPO production shrank 4.6% y/y to 152,995 MT, while palm kernel production climbed 7.3% to 32,794. FFB production fell 5.1%.

*Spackman Entertainment: Commenced filming of "Master" and is targeting for the film’s release in 4Q16. Total production budget for the movie is KRW12b (US$10.5m).

*Yangzijiang: Chairmen Ren Yuanlin is gifting 1b shares (26.17% stake) to Yangzi International Holdings.

*Rex: 72% owned subsidiary Masirah Oil announced that the prospectivity of Manarah-1 well in Block 50, offshore Oman, improved with confirmation of presence of hydrocarbons and working petroleum system.

*Swing Media: Proposed placement of 6.9m shares (15.8% enlarged share capital) at $0.533 each, to seven placees. Net proceeds of $3.7m is intended for working capital.

*Far East Group: Entered into a 51:24:25 JV with Yealea Industry and Beijing Zhufeng Dexin Refrigeration engineering, to manufacture, distribute, service, and repair various electronic products in China.