yield; maintain BUY with revised TP of S$0.82
Yangzijiang - Best proxy to shipbuilding recovery;
maintain BUY on higher S$1.32 TP
We maintain BUY call on Silverlake Axis with revised TP of
S$0.82 (Prev S$0.80), implying potential returns of over
18%. Silverlake Axis offers double-digit growth and 4.5%
yield. The backlog of ~RM325m at the end of FY13
provides 12-month visibility. The group is also pursuing
seven deals at the moment; big order win from a
Malaysian bank could be a catalyst.
Yangzijiang Shipbuilding is launching the first 10k TEU
containership on schedule. The on-track construction
progress of Yangzijiang's first large containership is a
confidence booster. We have raised FY14F earnings on
better margins and order wins; FY15F earnings are
expected to benefit from property income. Its investment
segment is well managed. Yangzijiang is the best proxy to
shipbuilding recovery; maintain BUY on higher S$1.32 TP
(Prev S$ 1.02).
Tiger Airways has pulled ahead of the pack, widening the
gap between itself and its competitors, according to a
latest report on the low-cost carrier (LCC) sector by the
Centre for Aviation (CAPA). The group now accounts for
33% of LCC capacity at Changi International Airport -
more than the 26% and 23% LCC capacity share of rivals
AirAsia and Jetstar, respectively. By year-end, Tigerair,
including Tigerair Mandala and Tigerair Philippines, will
account for almost 11% of total seat capacity at Changi,
compared with just under 8% each for Jetstar and
AirAsia, the report said. Tigerair Group attributed the
growth in capacity to its own fleet expansion strategy,
which will see a total of six A320 aircraft being delivered
by year-end.
Global Logistic Properties signs agreement with Vipshop,
a leading e-commerce company, to develop 130,000 sqm
of new built-to-suit facilities in Kunshan, Eastern China.
Construction of the first phase comprising 60,000 sqm
(646,000 sq ft) commenced in August 2013.
US Indices Last Close Pts Chg % Chg
Dow Jones 15,401.4 (49.7) (0.3)
S&P 1,701.8 (8.1) (0.5)
NASDAQ 3,765.3 (9.4) (0.3)
Regional Indices
ST Index 3,214.3 (23.3) (0.7)
ST Small Cap 580.1 1.0 0.2
Hang Seng 23,371.5 (131.0) (0.6)
HSCEI 10,717.7 (51.
(0.5)
HSCCI 4,484.5 (3.7) (0.1)
KLCI 1,796.4 (5.5) (0.3)
SET 1,436.7 (50.1) (3.4)
JCI 4,562.9 (21.0) (0.5)
PCOMP 6,477.9 53.5 0.8
KOSPI 2,009.4 3.8 0.2
TWSE 8,292.8 83.6 1.0
Nikkei 14,742.4 (23.
(0.2)
STI
Total Market cap (US$bn) 595
Total Daily Vol (m shrs) 4,539
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
23 Sep
Target Price
($)
ST Engineering Buy 4.23 4.80
ComfortDelgro Buy 1.96 2.19
OCBC Bank Buy 10.40 12.40
Singapore Airlines Buy 10.38 11.40
Suntec REIT Buy 1.675 1.78
Stock Picks – Small /Mid Cap
Rec’n Price ($)
23 Sep
Target Price
($)
Ezion Holdings Buy 2.35 3.20
Goodpack Buy 1.725 2.00
CSE Global Buy 0.90 1.07
Mapletree Commercial Trust Buy 1.20 1.35
CDL Hospitality Trust Buy 1.645 1.80
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
LionGold Corp has signed an ore processing agreement with
Australian-listed A1 Consolidated Gold in Victoria which may
boost revenues over a three year period. Up to 150,000
tonnes per year of ore from the A1 Gold Mine would be
processed at the nearby Ballarat gold plant, wholly-owned by
LionGold subsidiary, Castlemaine Goldfields. In conjunction
with the agreement, LionGold will subscribe to 34.5m new
A1 shares at A$0.116 per share, representing about 19.9%
of A1’s enlarged share capital, for a consideration of
S$4.7m. A1 will use the total proceeds to advance the
development of its A1 Gold Mine, which is targeted to begin
trial processing at Castlemaine’s Ballarat Mine within the
next six months. In addition to nearly doubling throughput at
the Ballarat plant, the collaboration with A1 represents an
opportunity to consolidate gold operations in southeast
Australia.
Oceanus Group reported that Typhoon Usagi has hit
Guangdong, coastal Zhejiang and Fujian provinces in China
where the majority of its abalone production is sited. The
group is assessing the damages caused.
The Singapore government is tightening the foreign
manpower regime further, with a 10% hike to the minimum
salary required to hire a young foreign professional on an
employment pass (EP) - the category of work passes not
subject to quotas and levies. Also, under new rules to ensure
Singaporeans get fair consideration before foreigners are
hired, employers will have to advertise job vacancies on a
new national jobs bank for two weeks before any
applications for EPs for those professional, managerial and
executive (PME) jobs will be accepted.
Singapore’s consumer price index (CPI) in August rose 2%
from a year ago, picking up from July's increase of 1.9% and
in line with market expectations of 2%. This slight rise was a
result of stronger increases in the costs of accommodation,
food and services - though these were partly offset by a
smaller gain in private road transport costs. Climbing at a
faster pace was the MAS core inflation measure, which
excludes costs of accommodation and private road transport.
This rose to 1.8% in August from 1.6% in July, due to
higher contributions from food and services. Food prices
increased 2.4% last month, up from 2.1% in July, mainly
due to costlier hawker and restaurant meals. Services
inflation picked up to 2.7% in August from 2.5% a month
earlier, driven by a stronger rise in cable TV charges and
tertiary education fees.
The flash HSBC Purchasing Managers' Index (PMI) for China
climbed to 51.2 last month from August's 50.1, hitting a
high not seen since March as stronger domestic and foreign
demand added to recent signs of a tentative turnaround in
the economy. New export orders jumped to a 10-month
peak of 50.8, up sharply from August's 47.2. It was the first
time in 6 months that exports had shown growth in the PMI.
Meanwhile, business activity in the Eurozone also grew
faster-than-expected in September as new orders flood in.
Markit's Flash Composite Purchasing Managers' Index (PMI)
jumped to 52.1 from last month's 51.5, its highest since
June 2011 and beating expectations for 51.9. The pace of
growth in the bloc's dominant services sector beat all
forecasts in a Reuters poll. The PMI came in at 52.1, well
ahead of August's 50.7 and comfortably above median
expectations for a more modest rise to 51.0.
US markets fell with investors still uncertain about the
timetable for QE cut back and as the democrats and
republicans hardened their positions on the stance regarding
the federal budget and borrowing limits. In line with Asian
bourses starting the Tuesday session lower, STI should begin
the current session modestly down but the intra-day
direction looks to be up as the index.
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