Goodpack - Resuming growth path; maintain BUY
and TP of S$2.00
Goodpack’s prudent business model and market share
gain bolster its earnings during downturn. Earnings
growth has been rather muted in the past two years. We
believe the tide is changing for Goodpack and project a 2-
year CAGR of 17% in FY13-15F, driven by market share
gain in synthetic rubber (SR) segment and cost-saving
initiatives. This is augmented by the recovery in US/Europe
(45% of Goodpack’s revenue) and bottoming out of the
rubber industry, which is expected to grow at 2-6% in the
same period. The crytalisation of an autopart contract
from a major OEM in Europe will prompt us to further rerate.
Dividend yield of 3-4% is decent while valuation is
undemanding. Maintain BUY and TP of S$2.00.
Yangzijiang announced that there was a further four
options with an aggregate value of US$ 110.4m
converted into effective orders last month, comprising
two units of 1,100 TEU containerships and two unit of
82,000 DWT bulk carries. The vessels will be delivered in
2015. YTD wins of US$1.2bn made up 60% of our full
year assumption of US$2bn. We believe Yangzijiang is on
track to meet our target. It has remaining 51 options
worth US$2.87bn, of which 22 options are for
containerships worth US$1.79bn and 29 options are for
multi-purpose bulk carriers worth US$1.08bn. Maintain
HOLD, TP: S$1.02.
Global Logistic Properties will commence development of
GLP Zama, a new multi-tenant logistics facility in Greater
Tokyo. GLP Zama is to be redeveloped into a 130,000 sqm
(1.4 million sq ft) multi-tenant logistics facility. This is the
sixth project under GLP Japan Development Venture,
which has now committed a total of JPY79.6 bn
(US$802m). The project will be completed in July 2015.
Indofood Sukses Makmur (INDF) has raised its stake in
China Minzhong Food Corp (MINZ) to 51.6%. The press
release said INDF's rationale included securing the supply
of instant noodle seasoning packs from China Minzhong
(presumably at lower than current cost), the introduction
US Indices Last Close Pts Chg % Chg
Dow Jones 14,930.9 96.9 0.7
S&P 1,653.1 13.3 0.8
NASDAQ 3,649.0 36.4 1.0
Regional Indices
ST Index 3,015.4 (39.4) (1.3)
ST Small Cap 536.7 (0.4) (0.1)
Hang Seng 22,326.2 (68.4) (0.3)
HSCEI 10,233.0 (17.9) (0.2)
HSCCI 4,302.0 (18.7) (0.4)
KLCI 1,716.8 (7.5) (0.4)
SET 1,303.2 (12.2) (0.9)
JCI 4,073.5 (90.6) (2.2)
PCOMP 5,968.3 (115.6) (1.9)
KOSPI 1,943.0 10.0 0.5
TWSE 8,083.4 (4.9) (0.1)
Nikkei 14,053.9 75.4 0.5
STI Index Performance
Total Market cap (US$bn) 562
Total Daily Vol (m shrs) 3,623
12m ST Index High 3,454
12m ST Index Low 2,946
Source: Bloomberg Finance L.P
Stock Picks – Large Cap
Rec’n Price ($)
4 Sep
Target Price
($)
ST Engineering Buy 3.900 4.80
ComfortDelgro Buy 1.835 2.19
OCBC Bank Buy 9.840 12.40
Stock Picks – Small /Mid Cap
Rec’n Price ($)
4 Sep
Target Price
($)
Ezion Holdings Buy 2.270 3.20
Goodpack Buy 1.640 2.00
Nam Cheong Buy 0.270 0.36
CSE Global Buy 0.865 0.97
Venture Corporation Buy 7.590 8.40
Source: Bloomberg Finance L.P, DBS Vickers
Singapore
Wired Daily
Page 2
of industrialised farming and replicating MINZ’s business
model in Indonesia. The press release also reiterated
INDF’s confidence in MINZ, and that INDF had taken
necessary steps to ensure that its investment in MINZ is
prudent.
Hiap Hoe has made its second strategic overseas
acquisition in two months. This time round, is a
commercial building on a 3,165 sqm site located in the
heart of Melbourne’s Central Business District, near the
corner of Lonsdale Street and Elizabeth Street. The
acquisition comes with a newly issued permit for an iconic
46 level mixed-use development comprising 627
apartments, 445 bay commercial car park and ground
level retail. The Group intends to fund this acquisition
with a combination of internal resources and debt.
Singapore retained its place as the world's second-most
competitive economy, after Switzerland which held the
top spot for a fifth year. This is according to the World
Economic Forum's latest Global Competitiveness Report.
Singapore is the only economy to feature in the top 3 in
seven out of the 12 pillars of the Global Competitiveness
Index, which looks at goods market efficiency, labour
market efficiency and financial market development,
among other pillars. Singapore's competitiveness is
further enhanced by its strong focus on education, which
has translated into a steady improvement of its ranking in
the higher education and training pillar, where it comes in
2nd, behind Finland.
In property news, twp residential sites - a freehold
redevelopment plot in Katong and a two-storey bungalow
in Bukit Timah are up for sale. The Katong site at 12
Amber Road is occupied by several old, vacant houses.
Measuring 22,800 square feet, it is zoned for residential
development, and has an allowable gross plot ratio of
2.8. The asking price, in excess of $63m, works out to a
land rate of some $1,300 psf ppr. Meanwhile, the Bukit
Timah site, with an indicative price of $32m, is in a goodclass
bungalow area. It is a corner plot at 19A Yarwood
Avenue, off Dunearn Road.
US stocks rose after the FED’s Beige Book survey reported
the economy continued to grow in July to August even as
borrowing costs increased. Automakers and technology
companies led gains. Meanwhile, the Senate panel has
authorized the US President to conduct a limited military
operation against Syria because of its use of chemical
weapons. The August ADP employment change
(consensus 182k, previous 200k) released tonight comes
ahead of Friday’s official job numbers.
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