Monday, March 24, 2014

OCBC Report

KEY IDEA

Telecom Sector: 4QCY13 results mostly tracking our estimates

Both M1 and SingTel reported 4QCY13 results that came in within our expectations, while StarHub’s results tracked below forecast. M1’s core FY13 earnings was 3.5% above our full-year forecast and SingTel’s 9MFY14 earnings met 73% of our FY14 estimate. But due to lower-than-expected EBITDA margin, StarHub’s core FY13 earnings was 5% below our forecast. Going forward, the telcos have largely kept their outlook unchanged from FY13. On the whole, we still think that yields are looking slightly more decent after the recent pullback. Hence we think that these stocks should continue to have a place in any portfolio also for their defensive earnings. Maintain NEUTRAL on the sector. (Carey Wong)
For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES


- US stocks bounced off session lows but still finished Mon lower as selloff in biotechnology companies weighed on indexes on a day light on economic news.


- Singapore's inflation rate eased more than expected to a four-year low of 0.4% in Feb, but economists were careful not to make too much of the fall.


- China Fishery Group has completed a series of transactions that would significantly enhance its capital structure and deployment as the company digests its acquisition of Copeinca ASA.


- Unionmet (Singapore) clarified that its substantial shareholder, Precious Stream Holdings, has had its rights entitlement scaled down from 87.9m shares to 23.9m, so as not to trigger a mandatory takeover.

- The trustee-manager of K-Green Trust has proposed an expansion of its investment mandate to cover a wider range of infrastructure assets.

- Independent directors of Singapore Land advised shareholders to either accept the takeover offer from United Industrial Corporation or sell their shares in open market if they can obtain a higher price.

- Oxley Holdings has invested 90m yuan (S$18.54m) in Sino-Singapore KAP Construction to undertake property development in China.

- Aberdeen International Fund Managers has ceased to be a substantial shareholder of Eu Yan Sang International Ltd, having disposed of 585,000 shares for about S$492,000.

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