Today’s Focus
Sarine - Leader in diamond manufacturing equipment; fair
value of S$2.90
We issue an Equity Explorer report on Sarine Technologies with
a fair value at S$2.90. Sarine is a technological pioneer and a
leading supplier of a full suite of equipment to process
diamonds and gemstones. Sarine’s business transformation is
leading recurring income towards 50% with higher margin. It
has a debt-free balance sheet and good FCF generation that
can support 2% yield or more. Upside risks would be
spectacular reception of new products while downside risks are
substantial shareholder sales and low stock liquidity.
Our plantation analyst gives an update on the plantation
sector. He believes the severe dryness experienced in most of
Southern Thailand, Peninsular Malaysia and Eastern Sumatra
earlier this year will adversely affect FFB yields for the remainder
of the year. He projects Apr14 output to ease 3% m-o-m to
1.458m MT. He believes that the recent drop in palm oil prices
is unlikely to sustain and is currently reviewing his palm oil price
forecasts with upside bias. Picks for SGX-listed plantation
stocks are Bumitama (BUY, TP: S$1.19) and Wilmar (BUY, TP:
S$3.92).
Ezra records 22% increase in 1H14 revenue to US$640.3m, led
by the Group’s Subsea Services division, EMAS AMC. Net profit
eased 25% to US$30.9m. There was an absence of a one-off
gain on disposal of fixed assets amounting to US$30m this
year. Excluding the one-off gain, adjusted net profit in 1H14
doubled to US$14.3m compared to 1H13. The Group’s
orderbook remains healthy with more than US$2.0 bn of
contracts, a majority of which is expected to be executed over
the next 12 to 18 months.
Rex International Holding’s 64.17% owned licence-holding
company Caribbean Rex, has scheduled a five-well onshore
drilling programme in two of its three concessions – South Erin
Block and Cory Moruga – in 2014, commencing in the next six
weeks. Locations of all wells to be drilled have been selected
based on Rex Virtual Drilling findings. One well is already
drilled, to be put on production. Caribbean Rex targets to
significantly grow production to over 500 bopd by end of
2014.
US Indices Last Close Pts Chg % Chg
Dow Jones 16,170.2 (267.0) (1.6)
S&P 1,833.1 (39.1) (2.1)
NASDAQ 4,054.1 (129.8) (3.1)
Regional Indices
ST Index 3,203.6 (6.3) (0.2)
ST Small Cap 547.1 (1.4) (0.3)
Hang Seng 23,187.0 343.8 1.5
HSCEI 10,421.3 40.6 0.4
HSCCI 4,374.3 69.0 1.6
KLCI 1,859.5 3.8 0.2
SET 1,389.6 7.5 0.5
JCI 4,765.7 (155.7) (3.2)
PCOMP 6,638.9 51.4 0.8
KOSPI 2,008.6 9.7 0.5
TWSE 8,948.1 17.5 0.2
Nikkei 14,300.1 0.4 0.0
STI Index Performance
Singapore
1,000
2,000
3,000
4,000
2006 2007 2008 2009 2010 2011 2012 2013 2014
100-Day MA
Index
STI
Total Market cap (US$bn) 600
Total Daily Vol (m shrs) 2,224
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$)
10 Apr
Target Price
(S$)
ComfortDelgro Buy 2.00 2.19
Global Logistic Properties Buy 2.59 3.31
Keppel Corp Buy 11.12 12.60
Stock Picks – Small Cap
Rec’n Price (S$)
10 Apr
Target Price
(S$)
Ezion Holdings Buy 2.09 3.26
Goodpack Buy 2.26 2.60
China Merchants Buy 0.97 1.32
Pacific Radiance Ltd Buy 1.08 1.20
Nam Cheong Buy 0.35 0.46
Centurion Corporation Buy 0.77 0.86
Source: DBS Bank
Singapore
Wired Daily
Page 2
Overseas Education proposes to issue an aggregate principal
amount of S$150m 5.20% bonds due 2019. The net
proceeds will only be used by the Group for the building of
the new school campus at Pasir Ris Drive 3, Singapore.
Gallant Venture intends to issue S$175m 5.95% notes due
2016. The Company intends to use the net proceeds for
partial refinancing of existing borrowings of the Group.
China’s exports and imports fell unexpectedly in March.
Exports were down 6.6% from March 2013, following an
18% y-o-y fall in February. Imports slipped 11.3%, reversing
a 10% rise in February. The trade surplus for the month
rebounded to US$7 bn from a US$23 bn deficit a month
earlier. Markets had expected a growth of 4.2% in exports
and 2.8% in imports.
All three major indices in US were down. The Nasdaq lead
the pack with a 3.1% loss. The Dow finished down 1.6%
and had its third biggest point loss of the year. The S&P 500
was off 2%. Technology and biotechnology stocks were
battered. Google, Amazon.com, Yahoo all finished down
more than 4%. Facebook fell over 5%. Jobless claims fell to
a 7-year low last week
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