Warrants Highlight

CapitaLand: +67% for 2012

Macquarie’s Capitaland warrants

CapitaLand outperforms STI
2012 saw leaders in Singapore worrying about a property bubble with housing prices trending higher while the global economy struggled. The stock price of CapitaLand moved higher with property prices, surging 67.4% last year. It outperformed the Straits Times Index which climbed 19.7% for the year.

New CEO, new organization structure
At the turn of the year, CapitaLand announced changes to its management and Mr Lim Ming Yan took over as Chief Executive Officer. After Mr Lim took over the helm, he reorganised the company into four main business units, namely CapitaLand Singapore, CapitaLand China, CapitaMalls Asia and The Ascott Limited. In addition to its restructuring, the largest developer in Southeast Asia will re-examine its property projects in the UK, India and the Middle East, as well as its 59% stake in Australia’s Australand Property Group.

Mr Lim said in a statement that “the simplified structure will allow the company to leverage and optimize its resources to enhance efficiency, economies of scale and shareholder returns”. Looking ahead, CapitaLand will focus on Singapore and China markets. Mr Lim expects the Chinese economy to continue transforming while land supply should get increasingly limited in Singapore. Meanwhile, competition in the real estate industry, which is influenced by government policy and regulation, will intensify.

Home prices at all time high
The new management came a day after the government said that home prices in Singapore climbed to a record in the fourth quarter. More specifically, “private property prices saw a rebound with the price increase in the fourth quarter contributing to more than 50% for the entire year”, according to PropNex Realty CEO Mohamed Ismail.

+3.8% in two days
CapitaLand started strong for the year 2013, advancing 3.8% in two days while the benchmark index gained 1.8%. Yesterday, it closed at $3.84, its highest in almost two years. The last time it traded above $3.84 was on 13th January 2011. Adding on, it was one of the top movers in the STI for the day.

Singapore Market Wrap

Bullish momentum continues

The STI rose 0.7% to 3,224.8 on Thursday as it continues its winning steak for the year. This is in line with the US market when the S&P 500 Index rose 2.5% on Wednesday night.

Call STI 3250MBeCW130430 (R5XW) exercise level 3,250.*
Put STI 3100MBePW130430 (R5WW) exercise level 3,100.*

Olam price jumped on bullish statement
Olam gained 3.3% to $1.70 on Thursday as it clawed back losses to close at its highest since 19th November 2012. Since being hit by Muddy Waters' report that questioned its accounting methods, the fall of Olam's share price made it the second worst performer of the Straits Times Index in 2012. Olam stated that it's current balance sheet position is at it's strongest since it's IPO in 2005.

Call Olam MB eCW130603 (R3LW) exercise price $1.80.*

CapitaLand restructures to focus on core markets
CapitaLand will be simplified into 4 core units, namely CapitaLand Singapore, CapitaLand China, CapitaMalls Asia as well as The Ascott Limited. This restructuring will allow it to "sharpen its focus on key markets and further accelerate its growth potential", says CapitaLand. Key appointment changes were also made to tap onto management's capability. CapitaLand rose 2.1% to close at $3.84 for the trading session.

Call CapitalaMBeCW130704 (R5YW) exercise price $4.00.*
Put CapitalaMBePW130903 (R5TW) exercise price $3.50.*

Overnight Market Wrap

Possible end to monthly bond purchase led decline in S&P

The US stocks made some gains early in the trading session yesterday after retailers showed improving sales and a private report suggested unexpected growth in employment although jobless claims increased marginally last week. Tonight, the country will announce its unemployment rate and nonfarm payrolls for December.

However, the index erased the gains to close at 1,459.37, down 0.2% day on day. The decline came after the Fed policy makers suggest that the monthly $85 billion bond purchases may end either mid or late 2013. According to Bloomberg, the central bank had bought $2.3 trillion in securities from prior bond purchases.

Overnight Markets

Indices	Last	Change
STI	3224.80	0.7%
HSI	23398.60	0.4%
DJIA	13391.40	-0.2%
S&P 500	1459.37	-0.2%
Nasdaq	3050.39	-
China A50	8329.00	2.1%

Corporate News

Corporate Announcements

Earnings release dates:
Tues 22 Jan: SGX (2Q13)
Mon 14 Jan: SPH (1Q13)