Tuesday, July 12, 2016

SG Market (12 Jul 16)

SG Market: The broad market is likely to push higher on revival in global risk appetite and potential easing in Japan.

Regional bourses opened positive this morning in Tokyo (+1.6%), Seoul (+0.2%) and Sydney (+0.5%).

STI is poised to break above its minor double top resistance at 2,880, towards the recent peak at 2,964.

Stocks to watch:
*Macro: DPM and Acting Finance Minister Tharman expects Brexit to dampen global growth and create more market volatility and economic uncertainty. However, the MTI believes the impact on Singapore’s short-term growth is not significant unless it coincides with other major shocks.

*Capitaland: 50:50 JV between Ascott and Qatar Investment Authority is acquiring a 221-unit serviced residence in Melbourne, Australia for A$71m, which will be subsequently leased to Quest Apartment Hotels when launched in 2019.

*GLP: Issuance of Rmb1.5b panda bonds, comprising a 3-year 3.12% bond and 5-year 3.58% bond, on Shanghai Stock Exchange was more than 3x subscribed. Proceeds will be used for debt repayment and business growth in China.

*China Everbright Water: Completed two wastewater treatment projects in Ji'nan with daily capacity of 50,000 tpd and 70,000 tpd.

*Perennial Real Estate: Investing Rmb189m into a 70:30 China JV with local developer Guangzhou Tongjie Real Estate, to engage in a property management business.

*Chiwayland: Marks maiden foray into US with a 50:50 JV with established developer Urban Commons, to develop a US$69m premium residential and hotel project in LA's Wilshire Corridor.

*Tee Land: 51:49 JV with KSH Holdings acquired a 1,115 sqm freehold site in Geylang for $20m, to develop a block of residential flats.

*Cheung Woh Tech: 1QFY17 net profit crept up 0.8% to $3.2m on higher associate contribution from Jiangsu Tysan Precision Engineering. But revenue dipped 1% to $21m, as deterioration in precision metal stamping (-16.7%) segment outweighed improvements in HDD components business (+2.6%). Gross margin narrowed to 18% (-3.8 ppt) on higher HDD material and labour costs. NAV/share at $0.3723.

*Sincap: Proposed placement of 36.7m new shares at 6¢ apiece, or 131% above the last closing price, to two individuals who owns a motorcycle trading business. The placement shares represent 7.6% of the existing share capital and 7% of the enlarged base. Net proceeds of $2.2m is intended to fund an acquisition.

*Pteris Global: Sharp Vision has obtained 91% acceptance level for its cash offer and the counter will be suspended for trading. Closing date for the $0.85/share buyout offer will be on 25 Jul.

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