Today’s Focus
Frasers Centrepoint Ltd – Offers high earnings visibility
from locked in sales and recurring income. Maintain
BUY, target price S$2.08.
We brought Frasers Centrepoint Ltd on a non-deal roadshow
in HK recently. Investors welcome a new property name with
a decent market cap in excess of S$4bn within the listed
space. Highlights of discussions centred around the group’s
current business model including geographic and asset class
allocations, potential for value unlocking from its hospitality
assets, market outlook and future direction and strategies
particularly after the presence of TCC Group as major
shareholders, dividend payout ratio and key liquidity issues
such as free float. Management reiterated that the group
would continue to focus on building both its recurrent and
development businesses to maintain a superior ROE metric.
FCL offers high earnings visibility from locked in sales and
recurring income. Maintain BUY, target price S$2.08.
Speakers at the 2014 Palm Oil Conference mostly expect
near-term palm oil prices to be strong, followed by softening
in 2H14 on expectations of seasonally higher output and
slower demand in biodiesel (due to higher feedstock cost).
Speakers did not offer price forecasts beyond 2014;
consensus for this year seems to point towards an average
price of RM2,950/MT. Factors to watch: weather anomalies,
soybean logistic issues/crop damage, hoarding by Argentine
farmers, and crude oil price volatility. Risks: Slowdown in
China, QE tapering, currency volatility, US shale gas.
Global Logistic Properties (GLP) has entered into a conditional
agreement to acquire a portfolio of 34 assets in Brazil from
BR Properties, the second largest modern logistics provider in
Brazil, for BRL 3.18 bn (US$1.36 bn), or a 9.4% yield. The
transaction, likely to be completed by 31 August 2014, is
expected to be immediately accretive. GLP intends to fund
the acquisition without issuing additional equity. This deal
strengthens GLP’s market-leading position in Brazil, one of
the world’s best markets for logistics.
US Indices Last Close Pts Chg % Chg
Dow Jones 16,360.2 (35.7) (0.2)
S&P 1,873.8 (0.1) (0.0)
NASDAQ 4,358.0 6.0 0.1
Regional Indices
ST Index 3,116.6 11.9 0.4
ST Small Cap 530.3 1.1 0.2
Hang Seng 22,579.8 (77.9) (0.3)
HSCEI 9,662.0 (114.8) (1.2)
HSCCI 4,168.0 (48.9) (1.2)
KLCI 1,829.1 2.6 0.1
SET 1,351.6 5.8 0.4
JCI 4,659.2 57.9 1.3
PCOMP 6,456.1 61.5 1.0
KOSPI 1,971.2 17.1 0.9
TWSE 8,632.9 78.4 0.9
Nikkei 14,897.6 176.2 1.2
STI Index Performance
Singapore
Total Market cap (US$bn) 570
Total Daily Vol (m shrs) 2,397
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$)
5 Mar
Target Price
(S$)
ComfortDelgro Buy 1.955 2.19
Global Logistic Properties Buy 2.800 3.31
Keppel Corp Buy 10.520 12.60
Yangzijiang Buy 1.130 1.45
Stock Picks – Small /Mid Cap
Rec’n Price (S$)
5 Mar
Target Price
($)
Ezion Holdings Buy 2.210 3.26
Goodpack Buy 1.910 2.25
China Merchants Buy 0.960 1.32
Pacific Radiance Ltd Buy 0.955 1.05
Nam Cheong Buy 0.335 0.43
Source: Bloomberg Finance L.P., DBS Bank
Singapore
Wired Daily
Page 2
SunMoon Food proposes to undertake a share
consolidation of every one hundred (100) shares into one
(1) consolidated share. The Group believes that the
proposed share consolidation will generally be beneficial to
the company and its shareholders.
Fram Exploration ASA, in which Rex International Holding
has a 27.86% interest, issues a total of 6.3m shares, or
about 20% stake to raise US$41.4m. Upon the completion
of the transaction, Rex International Holding’s direct
interest in Fram will be diluted from 27.86% to 22.29%.
China Environment has obtained bank credit facilities from
Bank of China totaling RMB120m for 2014. With these
credit facilities, the Group is in an even stronger position to
secure more contracts and to step up the utilisation of its
new plant in Anhui.
China has kept its 2014 GDP (gross domestic product)
target at "around 7.5%", a sign that the government still
considers growth a priority for stability and that it wants to
boost market confidence. At the annual National People's
Congress, Premier Li Keqiang hinted at some loosening of
monetary policy this year to offset any negative impacts of
slower growth and boost spending. Other economic
targets mentioned included a steady inflation rate of 3.5%.
Money supply M2 was also unchanged at 13% growth.
Import and export growth was fixed at 7.5% for 2014.
Retail sales are targeted to grow 14.5% this year. Fixedasset
investment growth was lowered to 17.5% and
output to 9.5%.
US stock indices ended with marginal changes ahead of
Friday’s job numbers. The February ADP employment figure
released last night came in lower than expected at 139k
(consensus 155k) and January’s number was revised lower
to 127k from 175k. The 10yr Treasury yield dipped a tat to
2.69% from 2.70%. Brent crude fell for a second straight
session to USD107.76pbl while gold price rose edged a
dollar to USD1339 an ounce.
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