SGX

SGX: Signs MOU with China Financial Futures Exchange (CFFEX) to develop derivatives mkts in China and Singapore. Both will jointly explore possible areas of cooperation including product and mkt development, info sharing and human resources training. With the agreement, both exchanges will also consider synergies to better address the demands and needs of market participants in China and Singapore. CFFEX is the sole exchange established for financial derivatives trading in China. Its main product is the Futures on CSI 300 Index, which tracks the performance of 300 A-share stocks listed on Shanghai and Shenzhen stock exchanges. Group is releasing its 3QFY13 results on 16 Apr, and Maybank KE recently noted that it will be SGX's most profitable quarter since the GFC in 2008; House believes SGX should be re-rated, given its decreasing reliance on securities revenue (29% of Group revenue from derivatives for FY13 compared to 26% in FY12); Maybank KE has a BUY rating, with TP of $9.00, pegged to 29x FY13F, +1 std dev above historical mean; The Street is still divided on SGX, with 6 Buys, 7 Holds, 6 Sells- with TP of $7.54; The past 4 weeks saw EPS upgrades of 0.6% and 0.9% for FY13 and FY14 respectively;