Thursday, January 26, 2017

SG Market (26 Jan 17)

The market could take a much-needed breather as optimism over Trump’s pro-growth stance could be met with profit-taking pressure.Regional bourses in Tokyo (+1.1%), Seoul (+0.2%) and Sydney (+0.4%) opened higher. Technically, the overbought STI needs to clear the 3,040 resistance before moving up to next objective at 3,110, while underlying support is at 2,980.

Stocks to watch:
*Mapletree Commercial Trust: 3QFY17 results slightly ahead of estimates as DPU jumped 9.6% to 2.28¢ despite a larger post rights unit base. Gross revenue and NPI surged to $108.8m (+47.4%) and $84.4m (+49%) respectively, driven by contributions from newly acquired Mapletree Business City 1 and 13.5% rental uplift at VivoCity. Portfolio occupancy improved 0.2ppt q/q to 99%, while aggregate leverage stood at 37% (-0.3ppt q/q). Trades at 6.2% annualised yield and 1.1x P/B.

*OUE Hospitality Trust: 4Q16 DPS of 1.36¢ (-20%) was diluted by an enlarged unit base (+34.4%) post-rights issue in Apr ’16, bringing FY16 DPS to 4.61¢ (-29.6%), beating estimates. Gross revenue ($33.2m, +0.7%) was supported by growth in its hotel business (+2.9%) with higher master lease from Crowne Plaza, partially offset by weakness in its retail segment (-4.8%). NPI rose 2.5% to $29.6m, buttressed by lower retail property expenses. Retail occupancy rose 5.1ppt q/q to 94.1%, while aggregate leverage grew 0.8ppt q/q to 38.1%. Trading at 7.9% annualised yield and 0.9x P/B.

*Keppel T&T: 4Q16 net profit slumped 93.1% YoY to $3.1m on lower data centre fair value gains of $4m (-87.4%). This brought FY16 net profit to $105.1m (+14.9%). Revenue fell 5.5% to $49.7m due to lower takings from its logistics and data centre divisions. Bottomline was further hurt by lower contributions ($9.5m, -69.7%) from JV/associates. First and final DPS hiked to 4.5¢ (4Q15: 3.5¢).

*CDL Hospitality Trust: 4Q16 DPU of 3.11¢ (+3.3%) was ahead of street estimates. Distributable income rose 3.8% to $30.9m from capital distribution. Revenue ($48.3m, -3.6%) was weighed by weaker Singapore/Maldives performance, partially offset by Grand Millenium Auckland. NPI ($37.7m, -0.3%) fell at a slower clip on lower property expenses. Singapore occupancy slumped 7.1ppt q/q to 83.6%, while aggregate leverage climbed 0.1ppt to 36.8%. Trading at 8.9% annualised yield and 0.9x P/B.

*CapitaLand RCT: 4Q16 DPU of 2.37¢ (-8.5%) brought full year DPU to 10.05¢ (-5.2%), meeting expectations. Quarter distributable income fell 5.6% to $20.6m from a weaker Rmb. Revenue (Rmb275.4m, +8.7%) and NPI (Rmb169.1m, +6.5%) were boosted by new contribution from CapitaMall Xinnan (acquired: 30 Sep), offset by higher property taxes. Occupancy improved 0.7ppt q/q to 95.9%, while aggregate leverage fell 1.4ppt to 35.3%. Trading at 6.7% annualized yield and 0.9x P/B.

*Viva Industrial Trust 4Q16 results met estimates with a DPU of 1.76¢ (+7.7%), as a stronger distributable income of $15.9m (+27.9%) overshadowed dilution of a larger unit base. Gross revenue and NPI soared to $25.6m and $18.1m respectively, on three new properties acquired since Nov '15, and improved occupancy at Viva Business Park. Overall portfolio occupancy rose 1.2ppt q/q to 89.8%, with WALE of 3.1 years. Aggregate leverage was pared to 37.2% (-2.6ppt q/q), but has risen back to 39.4% post acquisition of 6 Chin Bee Ave in Jan '17. Average debt cost at 4% and tenor at 3.2 years. Trades at 9.2% yield and 0.97x P/B..

*Sabana REIT: 4Q16 DPU slid 16.7% to 1.25¢, on a sharp drop in distributable income to $9.3m (-16.1%). Payout would plunge to 0.88¢ (-41.3%) if dilution from rights issue on 26 Jan '17 is accounted. Gross revenue tumbled to $22.5m (-8.2%) due to negative rental reversion, property divestments, and lower occupancy at some assets post conversion to multi-tenancy arrangement, which also gave rise to higher property expenses. Consequently, NPI fell to $13.9m (-14.7%). Portfolio occupancy declined 2ppt q/q to 87.2%, with WALE of 2.9 years. Aggregate leverage crept up to 43.2% (+1.7ppt q/q. 40% post-rights) amid a $40m fair value loss on investment properties, which slashed NAV/unit to $0.75 (-7.4% q/q). Trading at 9.4% annunalized yield post-rights, and 0.5x P/B pre-rights.

*Sembcorp Industries: Its 49% owned, Rmb4.67b ($966.5m) 1,320-MW power plant in Chongqing, China commenced full commercial operations but is not expected to contribute meaningfully in FY17.

*Perennial REH/ Breadtalk/Singhaiyi/Boustead Projects: Consortium led by Perennial is selling 70% of its stake in TripleOne Somerset for $305m. Perennial will receive $101m for its 20.2% stake, and book a $34.3m gain, whilst retaining a 30% share in the mall. Singhaiyi/Boustead/Breadtalk are completely exiting their 20%/5.5%/5.3% stakes.

*Fragrance Group: Acquiring The Imperial Hotel, a freehold four-star hotel located at Blackpool, UK, with total land area of 9,388 sqm. The hotel has hosted royalty, politicians and famous names since it was build in 1867. Total consideration for the property is 12.8m pounds.

*Cambridge Industrial Trust: Proposed to divest 55 Ubi Avenue 3, a five-storey light industrial building with GFA of 141,135 sf and remaining lease tenure of 39 years, for $22.138m (book value: $22m). The sale is subject to HDB's approval.

*SIIC Environment: Acquired CITIC Envirotech Water Resource (Hegang) from CITIC Envirotech for Rmb112.1m ($23.2m). The company operates two waste water treatment plants and a reclaimed water project with total design capacity of 110,000 tpd in Hegang, China.

*Equation Summit: Increased capital in subsidiary Disa Digital Safety, which rolled out its point-of-sale activation system for digital devices at all US Walmart stores, by $11.5m to $15.3m. The injection is via inter-company loan of $7.86m, and placement proceeds amounting to $3.64m.

*AusGroup: Terminated its lease agreement with Boustead Projects for the premises at 36 Tuas Road as it winds down its operations in Singapore. The agreement will see it pay $6.9m to Boustead after forfeiture of a security deposit over two years.

*Innovalues: Set to be taken over by Northstar and delisted on 17 Mar after 95% of shareholders present and voting at a court-directed meeting approved the acquisition.

2 comments:

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  2. Hello Everybody,
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