SG Market (19 Aug 16)

SG MarketThe Singapore market remains directionless with few catalysts to sway sentiment, but O&M counters may get some relief from the 3% surge in oil prices.

Regional markets opened mixed in Tokyo (+0.5%), Seoul (flat) and Sydney (+0.3%).From a chart perspective, topside resistance for STI is at 2,880, with underlying support at 2,830.

Stocks to watch:
*CRCT: Acquiring Galleria retail mall in Chengdu for Rmb1.54b via debt (90%) and cash (10%). The property has 34,736 sqm of retail space that is currently fully leased. Post-acquisition, pro forma FY15 leverage is expected to climb to 37% from 29%, while DPU will rise 3.2% to 10.94¢.

*GLP: Signed a strategic partnership agreement with China International Marine Containers to develop logistics facilities and solutions in China. This adds to the group’s network in its logistics eco-system, expanding its customer base and strengthening its land sourcing capabilities.

*OUE: Successfully tendered for two land parcels at 28 Nassim Road for $56.6m, or $1,700 psf from the British government.

*Yanlord Land: Credit agency Moody's has placed Yanlord's current Ba3 corporate family and senior unsecured ratings on review for upgrade, prompted by stronger performance and credit profile.

*Soilbuild REIT: Launched 1-for-10 preferential offering at $0.63/unit (7.4% discount to last close) to part-finance acquisition of Bukit Batok Connection. Controlling shareholder Lim Chap Huat has undertaken to take up his pro-rata entitlement of 25.2% and excess unsubscribed units.

*Vard: Secured a contract to construct three module carrier vessels for national maritime shipping company of Kazakhstan, Kazmortransflot, for US$70m. Delivery is scheduled between 3Q17 and 1Q18.

*Super: Terminated a JV with WA Gourmet and two individuals due to a material breach of employment contract.

*Parkson Retail Asia: Narrowed 4QFY16 net loss to $12m (4QFY15: $59.8m loss) on 10.9% growth in revenue to $93.9m on stronger same stores sales growth in Malaysia (+21.5%), and Indonesia (+7.3%), partially pared by declines in Myanmar (-25%), and Vietnam (-4.1%). Bottom line was supported by the absence of closure costs of $68.5m recognised in 4QFY15. NAV/share at $0.24.

*Civmec: 4QFY16 net profit plunged to $1.5m (-77.4%), dragging full-year earnings to $17.4m (-42.5%). Quarterly revenue sank 23% to $88.4m on depreciation in AUD, weakening gross margin by 4.1ppt to 8.2%. Bottom line was further weighed by absence of a one-off tax gain. Maintained first and final DPS of 0.7¢. NAV/share at $0.3211.

*NauticAWT: Awarded a 2-year subsea engineering and installation contract involving 15 platforms in Indian waters. TheUS$2.5m contract is expected to commence in 4Q16.

*Interra Resources: Recommenced drilling in its 60%-owned Chauk oil field in Myanmar. Results of the drilling should be available in about six weeks.

*Otto Marine/ Hoe Leong: Otto Marine is suing Hoe Leong for an outstanding amount of US$0.9m. However, Hoe Leong believes it has abided by the terms of settlement.