SG Market (10 Apr 17)

The market could consolidate with a positive bias following the amicable first summit between Presidents Trump and Xi last week, with both sides agreeing on a 100-day plan for trade talks and averting a potentially damaging trade war.

Focus this shortened trading week will be centred on MAS policy statement, which is expected to stay neutral, and Singapore's 1Q flash GDP estimate, which may have some upside risk.Regional markets opened mixed in Tokyo (+0.7%), Seoul (-0.6%) and Sydney (+0.5%).Technically, topside resistance for the STI is at 3,200 with immediate support at 3,140.

Stocks to watch:
*CWT: China's HNA Group has launched a US$1b takeover offer at $2.33 apiece (excluding FY16 DPS of $0.03), after controlling Loi, Liao and Lim families, which collectively own 65.13% of the logistics group, gave their undertaking to accept the offer. Pre-conditions, including anti-trust approval from six regulators, are required to be fulfilled before 9 Sep.

*Sembcorp Industries: Won a bid to build a new 250MW wind power plant in Tamil Nadu, India. The $250m project is is expected to be fully commissioned in 2H19, with its entire output sold to Power Trading Corp under a 25-year power purchase agreement.

*SGX: Mar securities turnover grew 7% y/y and 3% m/m to $29.1b over a longer trading month of 23 days (Mar '16: 22 days, Feb '17: 20 days), with average daily value of $1.27b (+2% y/y, -10% m/m). Derivatives volume totalled 15.7m contracts (-8% y/y, +26% m/m) as trading in equity indexes slowed 10% y/y (+25% m/m) but was partly mitigated by increased trading in FX futures (+ 56% y/y, +27% m/m). Commodities derivatives trading volume fell 11% y/y but was up 35% m/m.

*F&N: Plans to buy 14.5m Vinamilk shares from the open market between 12 Apr and 11 May '17, potentially raising its ownership to 242.2m shares, or 16.69%.

*UnUsUaL: Marks its trading debt today following the listing of 97m new shares at $0.20 apiece. Parent mm2 Asia is expected to track the performance of UnUsUaL on account of its 42% (post IPO) shareholding.

*Cogent: Completed and commenced full operations at 1) Jurong Island Container Depot and 2) Sky Depot at Cogent 1.Logistics Hub, as well as the completed its Malaysian warehouse at Port Klang, which will be leased to a single tenant for 3 years from 14 Apr.

*Keong Hong: Awarded $214.2m construction contract for the Seaside Residences condominium project at Siglap Road. Works include the construction of four residential towers of 27 storeys totalling 843 units and ancillary facilities.

*Tuan Sing: Acquiring Sime Darby Centre at 896 Dunearn Road for $365m and intends to reposition the property into a hub of activities..


*Heeton/ KSH/ Lian Beng/ Ryobi Kiso: Formed a consortium that entered a franchise agreement with Hilton Int'l to operate the 192-room Hampton hotel in Leeds, UK, currently under construction. Operations are expected to begin in late 2019.

*Vard: Secured a contract for the design and construction of a live fish transportation vessel for an undisclosed amount for Fjordlaks Aqua in Norway. Delivery is expected to be in 3Q18.

*Vibrant/Sabana REIT: Vibrant disclosed that it is in discussions to acquire a further 45% stake in the manager of Sabana REIT, which holds 12% of the REIT's total units, but no binding arrangements have been entered into.

*Falcon Energy: Plans to dispose its 21.83% stake in CH Offshore for $20m as it seeks funds to meet its obligation to repay a CIMB term loan instalment. The potential sale is expected to incur a further loss of $10.8m on top of the US$35.4m already written down.

*Miyoshi: 2QFY17 net profit tumbled 54% from a low base to $0.2m, as revenue shrank 11.8% to $11.7m on fewer orders from consumer electronics customers. Bottom line was further dragged by a 76.1% jump in tax. NAV/share at $0.1193.

*Imperium Crown: Disposing its remaining Japanese property portfolio for ¥1.52b ($19.3m), or 11% below market valuation. Pro forma FY16 NTA is expected to drop 3.6% to $0.1056, while LPS will widen from 2.53¢ to 3.13¢.

*KS Energy: Disclosed that Executive Chairman and CEO Kris Taenar Wiluan and Executive Director Richard James Wiluan have been interviewed by the CAD in its investigations into a potential breach of the provisions of the Securities and Futures Act.

*KOP: Paid a deposit of Rmb176.6m together with JV partners Shanghai LuJiaZui Zhi Mao Investment and Shanghai Harbour City Development, to acquire a plot of land at Lingang, Pudong New District in Shanghai for the development of a resort named Wintastar.

*Cosco Corp: 51% owned subsidiary, COSCO Shipyard has been hit with a delivery deferral relating to two jack-up rigs under construction for Northern Offshore. The new agreement stipulates that acceptance for the rigs will be pushed back to end-Sep ’17 and Mar ’18, with delivery of the rigs deferred until further notice.