Tuesday, March 18, 2014

DBS Vickers Report 18 Mar 14


Today’s Focus
􀂃 Small Mid Caps Radar - China Environment, C&G
Environment Protection and Ausgroup
􀂃 Midas - Won RMB71.9m railway contract
We feature three SGX-listed stocks in our Small Mid Caps
Radar. They are China Environment (CENV SP), C&G
Environment Protection (CNG SP) and Ausgroup (AUSG SP).
CENV is a proxy to China’s air pollution control. Earnings
could double in FY14F; valuation undemanding at <12x
FY14F PE. Risks are project execution & doubtful receivables.
CNG is China’s waste-to-energy (WTE) play poised to turn
profitable. The Group is expected to reap operationally +
potential HK$300m divestment gain. We expect bumper
dividend from sale proceeds of its WTE assets in China to
Grandblue. Its biggest risk is failure of asset sales. Ausgroup is
an industrial engineering group targets margin turnaround on
LNG boom and stronger balance sheet. Further re-rating is
dependent on order wins and earnings execution.
Midas Holdings has won RMB71.9m in orders from CNR
Changchun Railway Vehicles. The first contract is for the
supply of aluminium alloy extrusion profiles for 228 train cars
to Shenzhen Metro Lines 2 and 5. The second contract is for
the supply of aluminium alloy extrusion profiles for 144 train
cars to Wuhan Metro Line 4. This contract is slated for
delivery between 2014 and 2015.
OUE announced that a consortium consisting of OUE, Lippo
Limited and Caesars Entertainment Corporation has been
granted pre-approval by the Ministry of Culture, Sports and
Tourism of the Republic of Korea to develop the first
internationally branded integrated entertainment resort in
South Korea. The Project is expected to involve an estimated
total project cost of approximately Korean Won 855 billion
(approximately SGD1 billion) with total development gross
floor area of over 150,000 square metres on a 4.3 hectares
site.
Rickmers Maritime has secured new employment for two of
its vessels to Maersk Line. The two vessels will be chartered at
a floating rate based on an index agreed upon by both
parties. The charters are expected to generate revenue for the
Trust amounting to an estimated US$5m over the initial 12
months.
US Indices Last Close Pts Chg % Chg
Dow Jones 􀀘 16,336.2 89.0 0.5
S&P 􀀘 1,872.3 13.4 0.7
NASDAQ 􀀘 4,333.3 53.4 1.2
Regional Indices
ST Index 􀀘 3,093.8 1.7 0.1
ST Small Cap 􀀙 538.8 (0.1) (0.0)
Hang Seng 􀀘 21,583.5 109.5 0.5
HSCEI 􀀘 9,342.3 9.3 0.1
HSCCI 􀀘 3,993.0 26.5 0.7
KLCI 􀀘 1,820.7 5.5 0.3
SET 􀀙 1,373.1 (4.0) (0.3)
JCI 􀀙 4,805.6 (70.6) (1.4)
PCOMP 􀀘 6,466.6 66.6 1.0
KOSPI 􀀘 1,940.2 12.7 0.7
TWSE 􀀘 8,731.9 31.8 0.4
Nikkei 􀀘 14,411.3 133.6 0.9
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013 2014
100-Day MA
Index
STI
Total Market cap (US$bn) 570
Total Daily Vol (m shrs) 1,707
12m ST Index High 3,454
12m ST Index Low 2,960
Source: Bloomberg Finance L.P.
Stock Picks – Large Cap
Rec’n Price (S$)
18 Mar
Target Price
(S$)
ComfortDelgro Buy 1.925 2.19
Global Logistic Properties Buy 2.67 3.31
Keppel Corp Buy 10.62 12.60
Yangzijiang Buy 1.045 1.45
Stock Picks – Small /Mid Cap
Rec’n Price (S$)
18 Mar
Target Price
($)
Ezion Holdings Buy 2.04 3.26
Goodpack Buy 2.03 2.25
China Merchants Buy 0.97 1.32
Pacific Radiance Ltd Buy 0.985 1.20
Nam Cheong Buy 0.315 0.43
Source: Bloomberg Finance L.P., DBS Bank
Singapore
Wired Daily
Page 2
Q&M Dental Group has agreed to buy a dental clinic in
Singapore's Orchard Road district valued at $5.5m in an
all-share transaction. The 15.09m consideration shares will
be priced at 36.45 cents apiece, or 90% of the volumeweighted
average price of Q&M's shares on March 17.
They represent about 2.5% of Q&M's outstanding
603.04m shares as at last Dec 31. The transaction is with
vendor Foo Mooh Thong, a prosthodontist who specialises
in computer-aided design and milling. He will sell his entire
stake in Foo & Associates, which is located in Paragon mall.
Dr Foo will also guarantee an annual profit of at least
$525,000, or an aggregate profit of $5.25m over 10 years.
Bumitama Agri issued RM500m of Islamic medium term
notes (IMTNs) under the Ringgit-denominated Islamic
medium term note programme of up to RM2.0 bn. The
IMTNs have a tenor of 5 years and will bear a periodic
distribution rate of 5.25% per annum, payable semiannually
in arrears. It will mature on 18 March 2019. The
net proceeds raised will be utilised for the Group's capital
expenditure, working capital, investments, refinancing
existing debt and general corporate purposes.
Kerry Logistics Network, a unit of tycoon Robert Kuok's
Kerry Properties and one of the hot new listings on the
Hong Kong stock exchange last year, may consider a
secondary listing on Singapore Exchange (SGX). Kerry
Logistics, a Hong Kong-based third party logistics service
provider, was listed on HK Exchange last December in an
exercise that raised about US$284m.
U.S. stocks climbed ahead of the FOMC meeting outcome
later tonight as housing data bolstered confidence in the
economy and Vladimir Putin said Russia isn’t seeking to
split Ukraine. February building permits rose to 1018k
(consensus 960k) from 937k in January while the housing
starts figure was almost in line at 907k (consensus 910k).
The FED will likely announce a US$10bil cut to monthly
bond purchases later tonight, this according to consensus.
At the same time, investors will also eye whether Janet
Yellen will signal a change in the threshold that the Fed
had said would mark when it would start seeking a hike in
interest rates. Yellen could indicate "a broader range of
economic indicators and not just based on the 6.5%
unemployment rate threshold

No comments:

Post a Comment