SPH

SPH: Deutsche downgrades to Hold from buy, lowers TP to $3.80 from $4.33. Turns cautious on growth outlook. Says, in view of the GDP outlook, it is concerned that SPH’s ad revenue growth could be more muted than previously assumed. Notes increasing caution with most stakeholders expecting flat to slightly declining adex growth in 2012. Believes there is risk that adex growth will undershoot current expectations. Also expects slowing rental growth to limit upside from SPH’s property assets, with risks to the downside in the event of further deterioration in the macro outlook.

Cuts SPH’s FY12-13E ad revenue growth to 3% YoY respectively (from 4-5% previously). Also trims property income estimates on the assumption that Paragon rental growth will moderate more sharply while near-term rental upside from Clementi Mall will remain modest. Expects net profit growth to be muted at 3% FY10-13E CAGR and the lack of positive catalysts should limit share price upside.