SGX Stocks and Warrants
Singtel - MER's price target of $3.60
Warrants Highlight
Singtel - MER's price target of $3.60
Singtel share price has been performing well the past month after slumping to a low of $3.12 on 15th November. Since then, the counter has jumped 8.3% as of the close yesterday, outperforming the STI which has rallied 7.1% for the same period of time.
Macquarie’s Singtel warrants
| Code | Name | Type | Expiry | Exercise Price |
| PB6W | SingTelMBeCW130301 | Call | 01-Mar-13 | 3.30 |
Last Friday, Macquarie Equities Research (MER) released a research report on Singtel, revising their target price upwards and keeping its ‘Outperforming’ rating. Below are some excerpts from the report.
MER reiterates its Outperform recommendation on SingTel with an increased price target of S$3.60 (prev S$3.53) providing a 6.5% total share return (based on the closing price yesterday), following upgrades to its estimates and target valuation for 35%-owned associate Telkomsel. Improved competitive dynamics in the Indonesian telecoms market and better execution by Telkomsel were key drivers of these upgrades. At 6.3x FY13E adjusted enterprise value/earnings before interest, tax, depreciation and amortization (EV/EBITDA) and offering a 5% dividend yield SingTel remains MER’s top telco pick in Singapore.
Indonesia – rational competition, growing data. Macquarie’s Riaz Hyder has raised his estimates and valuations for the Indonesian telecoms sector. He sees the competition in Indonesia as increasingly rational with operators concentrating on product/service differentiation rather than pure price to attract subscribers – a perennial problem in the past. Also with incumbent operators building out their own data businesses, there seems to be a greater focus on cashflow generation to fund network expansion.
Telkomsel – better execution fuels upgrades. In addition to the improved market dynamics, improved execution on the part of Telkomsel has also fuelled a 13-25% upgrade in Riaz’s FY12-15 estimates for Telkomsel and an 11% upgrade in his DCF-derived valuation for Telkomsel.
India – moving in the right direction. While the Indian telecoms market environment remains fluid, MER is increasingly positive on its outlook. Recent discussions with senior management teams from Axiata and Telenor, have provided added comfort on the outlook for competition and allayed the fear of future policy changes unwinding the outcome of the recent 2G spectrum bid – thanks to a well thought of and transparent process. For SingTel, Bharti remains the biggest contributor (42%) to the valuation gap between its current price and MER’s target valuation.
Singapore Market Wrap
STI continues its relentless march
The STI extended its winning streak as it ended in positive territory for the seventh consecutive day, displaying bullish market sentiments despite the impending US "Fiscal Cliff" and the European sovereign debt crisis. The STI rose 0.5% day-on-day to 3,156.55.
Call STI 3100MBeCW130228 (RF9W) exercise level 3,100.*
Put STI 2950MBePW130228 (RG0W) exercise level 2,950.*
SembMarine acquires site
SembMarine has reported the acquisition of a 34.5 -hectare site for its second stage development of an integrated New Yard Facility. This forms part of a planned 206-hectare New Yard Facility which SembMarine has announced in November 2009. This New Yard Facility would allow the company to strive for long-term growth and competitiveness. SembMarine rose 0.2% to $4.55 on Thursday.
Call SembMar MBeCW130604 (RE6W) exercise price $4.80.*
Put SembMar MBePW130701 (R0OW) exercise price $4.40.*
GLP signed new 44,000 square metres lease
New tenants were secured at GLP's logistics facilities in Eastern China as GLP continues its strong leasing activities in China. The tenants are Haier Group, Dingtong Logistics Co. Ltd, Master Kong Food Co. Ltd as well as Senlan Environmental Protection (Shanghai) Co. Ltd. GLP is a market-leader of modern logistics facilities in China, Japan and Brazil. GLP climbed 0.7% to $2.71 for the trading session.
Call GLP MB eCW130603 (Q8UW) exercise price $2.90.*
Overnight Market Wrap
S&P snaps six-days rally
Last night, retail sales in November rebounded and initial jobless claims fell, but the US stocks failed to continue its six-day rally and the S&P fell 0.6% to close at 1419.45.
The fall came after the deadlock in the budget negotiations and US House Speaker John Boehner said that President Barack Obama's budget proposal is "anything but" balanced and accused the president of being "not serious" about cutting spending. President Obama on the other hand said that negotiations are "still a work in progress".
Overnight Markets
| Indices | Last | Change |
|---|---|---|
| STI | 3156.55 |
0.5%  |
| HSI | 22445.60 |
-0.3%  |
| DJIA | 13170.70 |
-0.6% |
| S&P 500 | 1419.45 |
-0.6% |
| Nasdaq | 2992.16 |
-0.7% |
| China A50 | 7344.30 |
-1.2% |
Corporate News
Corporate Announcements
Ex-dividend dates:
Mon 24 Dec: Singtel ($0.068)
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| Chart | Stock Name | Last | Change | Volume |
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