Telco

Telco: Credit Suisse sees positive indications for Next gen Nationwide Broadband Network (NBN) progress to accelerate. Says coverage is increasing, pricing is more competitive, while the “ecosystem” for fibre broadband services is also growing. Expects NBN penetration to reach 29% by end 2013e and 47% by end 2015e. The house views M1 as the key beneficiary, given an opportunity to penetrate the fixed line segment where it has limited exposure. Upgrades M1 to Outperform with TP $3, as it offers good medium term growth from mobile data and NBN, with attractive 6% div yield. Says Starhub may face higher pressure in residential, but this could be offset by opportunities in the corporate segment. Keeps at Neutral with TP $3.25, with solid yield to provide support. Expects SingTel to face pressure on both sides, as it needs to focus on developing new services / VAS to differentiate and maintain its revenue. Says SingTel’s significant regional diversification means the NBN impact to the group is not expected to be very material and its key growth driver remains its regional associates. Sees downside risks to consensus from foreign exchange headwinds; maintains Neutral with TP $3.19.

CWT

CWT: UOB Kay Hian maintains Buy and increases TP to $2.09 from $1.80 after meet up with mgt. Key pts as follow: 1) New growth driver from commodity trading: See this area as a potential new area for CWT’s future growth. This is a natural progression given its presence and experience in commodity logistics, which provide CWT with natural advantages such as trading information flow and strong existing relationships with upstream and downstream Co’s. 2) Managing the risk. Although investors are likely to be sceptical of CWT’s venture into commodity trading, believe mgt has taken adequate steps to safeguard its exposure. In addition, grp does physical hedging rather than pure hedging with a net exposure Leverage for its commodity trading arm is “ring-fenced” at the subsidiary as it uses non-recourse financing, with no ultimate liability to CWT. 3) Warehousing update. Grp recently undertook a sales and leaseback transaction on its Pandan Logistics Hub, which will result in a deferred gain of S$11.8m. This is expected to be recognised over the next 3-4 years. In terms of capacity, the group has recently started construction of Cold Hub 2, which is targeted for wine storage. 4) Consolidation phase. After its M&A phase over the past two years, understand that mgt’s current focus would be to integrate its new investments and focus on organic growth for its existing businesses in freight and logistics. Overall, conclude that CWT remains attractive for its global exposure to trade, dominance in logistics niches and strong financials. Although investors could be concerned about its venture into commodity trading, believe this is reflected in its undemanding valuations.

Asia Medic

Asia Medic: Has signed two agreements to set up a post-natal confinement centre and a medical centre respectively in Shanghai, PRC. Co is currently loss making with FY11 losses of $800k. Co current trades at 0.7x P/B Another co with similar developments in China, Q&M currently trades at over 40x P/E with P/B of 6.88x

Genting

Genting: The Australian Saga continues. Msian gambling and resorts operator raises Echo stake to near 10%. According to news reports from Australia, Genting Group has increased its stake in Echo Entertainment to almost 10%, putting the Msian gambling and resorts operator on par with Australian billionaire James Packer and seeking to gain control of the casino company. James Packer, who already owns 10% of Echo through Crown, wants to use Echo's licence to build a new casino complex in Sydney to attract more Asian high-rollers. Analysts note that there may have been an agreement between Genting's KT Lim (chairman Lim Kok Thay) and Crown's James Packer that each group would hold a 10% blocking interest for now and wait to see what develops. The pact could fend off potential hostile takeover bids. Genting bought 2% of Echo, or 13.8m shares worth around A$60m (S$77.1m), in a single trade yesterday morning, according to sources and brokers in Sydney. That follows a block trade by Genting's HK unit on Mon for 19.26m Echo shares, or about 2.8% of the co, worth A$82.6m, according to a stock market filing by Genting Hong Kong. The latest deals would take Genting's stake through various group firms to 9.7%. Under Echo's constitution, no single party can hold more than 10 per cent and will need a regulatory nod to go further. Reuters

Asiasons Capital

Asiasons Capital: Has acquired Hi-5 Australia, one of the top three most successful pre-school television shows in Australia including its total ownership encompassing production, licensing, touring and merchandising rights. Co has also hired an Aus tream including Hi-5's series producer and general mgr. The co which is a private equity firm has known stakes in Chaswood and Liongold.

YZJ

YZJ: Co will dispose of its 31.5% stake in Wuxi Runyuan Tech for approx Rmb104.0m which is approx a 10% premium to NAV which it acquired in Sep 2011. Co has another micro-financing unit Jiangsu Runyuan which co acquired 100% at Rmb300m. UOB maintains Buy on yday’s news of order cancellation. Co will suffer no loss from the cancellation as co has impounded the 20% downpayment which is approx US$5m. Even if co is able to resell the vessels at a 10% discount to current newbuild prices, co will be able to break even. House expects more cancellations ahead but sees no danger for YZJ as 28% of its vessels are from European shipowners and financing is from the Chinese banks DBS also does not foresee much difficultly for YZJ but opines that cancellation will be negative on sentiment. Highlights that Cosco Corp has the highest exposure to Greece and Europe with over 60% of orderbook (28% from financially vulnerable Sevan Drilling).

STX OSV

STX OSV: Strong momentum continues, with grp announcing that it has secured contracts for the design and construction of 2 Platform Supply Vessels (PSVs) for Farstad Shipping. The total value of the contracts amounts to approximately Nok 700m. The first vessel is scheduled for delivery in 2Q14 from STX OSV Langsten in Norway and the second vessel in 3Q14. Latest contracts lifted Ytd order wins to approximately NOK6.9b vs FY11 at Nok11.1b and brings current order book to approximately Nok18-19b, vs FY11 order book of Nok16.7b and underpinning earnings visibility for 2 yrs. DBSV maintains Buy with $2.00 TP on back of contract wins. We also note that majority of street remains positive on stock, with 13 Buy Calls and 2 Holds with a Mean TP of $1.88.