SIA Engine (technical)

SIA Engine: UOB Kay Hian estimate SIAEC will declare a 15c final div when it announces full-year results on 14 May, taking total payout to 22c for FY13. At the current level, this translates to a yield of 4.5%. There is also a possibility that the final dividend could be higher than our initial estimate. Historically, the co paid in excess of 100% of recurring free cash flow and such a possibility cannot be ruled out, especially with SIA needing funds. If half of the cash balance is paid out, SIAEC could declare a 9c special div, which would raise the yield to 6.7%. House have a fair value of $5.20 on the stock based on a dividend discount model. From a technical view, the stock looks poised to trend higher towards $5.25 should it be well supported at above $4.67.