Wednesday, April 19, 2017

SG Market (19 Apr 17)

The market remains in a cautious mood as investors wait for more corporate results amid a recovering economy and ahead of crucial elections in France and Britain.

Regional markets opened lower in Tokyo (-0.3%), Seoul (-0.4%) and Sydney (-0.5%).Technically, the STI appears trapped between the 20 and 50-dmas at 3,135 and 3,160, with downward bias towards next level at 3,110.

Stocks to watch:
*CCT: 1Q17 DPU climbed 9.6% to 2.4¢, meeting 26% of full year street estimate. Post-acquisition of remaining 60% stake in CapitaGreen in Sep ’16, gross revenue and NPI surged to $89.5m (+33.9%) and $69.9m (+32.6%). Portfolio occupancy improved slightly to 97.8% (4Q16: 97.1%), while aggregate leverage inched 0.3ppt higher to 38.1%. Management guided that NPI of some properties is expected to soften in later part of 2017 as more renewals and new leases are committed below expiring rents. NAV/share at $1.75.

*Keppel T&T: 1Q17 results missed estimates as net profit fell 13.1% to $11.6m on weaker contributions from data centre and logistics units. Revenue dropped 15.6% to $40.7m following the partial disposals of 90% stake in Keppel DC Singapore 3 and 50% interest in Keppel DC REIT Management to sister companies, both of which have been reclassified as associates. NAV/share inched up 1¢ q/q to $1.44.

*ST Engineering: Its electronics arm secured $464m worth of contracts in 1Q17 for rail electronics & intelligent transportation, satellite & broadband communications as well as advanced electronics & information communications technologies solutions.

*Keppel Corp: Its Infrastructure arm has signed a non-binding agreement with the EDB to develop, own and operate a gasification facility on Jurong Island.

*UOB/ SIA: UOB launched the KrisFlyer UOB current account, which allows customers to earn KrisFlyer miles at a quicker rate on spending, provided there is a minimum average balance of $3,000 and above. The bank aims to open at least 200,000 KrisFlyer UOB accounts over the next five years, and bring in deposits of ~$1.5b. MKE last had a Hold and TP of $19.54.

*AEM: Flagged that it has received purchase orders worth $152m for delivery in FY17.

*King Wan: Secured new mechanical and electrical projects in Singapore worth $33m in 1Q17. This brings its order book to $163m with contracts lasting till 2024.

*China Kangda: A group of vendors led by Gao Sishi with cumulative shareholding of 57.1% and Zensho Holdings (12.1% stake) have entered into two separate agreements with a potential purchaser to extend the exclusivity period for a possible transaction till 30 Apr.

*Far East Hospitality Trust: Withdrew its Moody's corporate credit rating, following the amendment to the Code on Collective Investment Schemes to adopt a single-tier aggregate leverage limit of 45% without the requirement for a credit rating.

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