Singpost: UBS downgrade to Neutral from Buy and cut TP to $1.14 from $1.27. Forecast operating margins to structurally decline from 34.6% in FY11 to 31.7% by FY16 and to 25% in the long term due to: 1) near-term wage inflation pressure; 2) declining mail business margins; and 3) greater contribution from the lower-margin logistics business.
Expect further logistics-focused acquisitions over the next 12-18 mths. Add that defensive stock nature and 5.7% div yield should help support share price.
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