STOCK IN FOCUS


CAPITALAND LTD  
CapitaLand Ltd (CapLand) reported net pro't of S$519mil for 1HFY12, up 4% YoY. Excluding S$287mil revaluation adjustments, results would be below expectations, having met 38% of consensus estimates and 26% of our FY12F forecast. Contrary to 1QFY12, progressive revenue recognition were on the back of higher margin projects such as The Interlace, The Wharf Residence and Urban Resort Condominium. Australand also recorded higher residential sales whilst CapitaMalls Asia bene'ted from injecting two China malls into a fund.

259 units with sales value of S$467mil was sold by CapLand in 1HFY12. It constituted 2% market share and    a 4% drop YoY. On a negative note, we noted that sales value had experienced a sharper fall of 17% YoY on lower quantum sales, namely Bedok Residences.   Net gearing had maintained at 0.4x QoQ with average debt maturity of 3.7 years. However, with S$2.4bil of new investment committed for 1HFY12, CapLand will face pressure on its debt headroom unless more assets are being divested.

We have revised our RNAV estimates upwards by 4% to S$3.53/ share factoring higher share prices of listed associates. With fair value at parity to our RNAV estimates, we maintain our BUY rating.


NEWS BUZZ


Great Eastern Holdings (S$13.55) 
Pro't down 31% in Q2, up 24% in H1  
Great Eastern Holdings posted a 31% drop in 2Q net pro't to $81.4mil, as weak market conditions a'ected its investment performance. Total weighted new sales for Great Eastern rose 4% in Q2 to $197.4mil. It has declared an interim dividend of 10 cents per ordinary share payable on Sept 5.  Great Eastern is in the process of selling its shares in Fraser and Neave to Thai Beverage, and shares in Asia Paci'c Breweries to Kindest Place Groups. The deals are expected to bring it a pre'tax gain of some $2.2 billion and a post'tax gain of $421.6 million.

SembCorp Industries (S$5.33) 
Starts up new waste water treatment plant  
SembCorp Industries' newest $40mil wastewater treatment plant has started operations on its premises on Jurong Island. As part of its $960mil plan, the group will be introducing its second combined'cycle gas turbine cogeneration plant in Singapore with a capacity of 400MW and 200 tonnes per hour of process steam to begin with, and a multi'utilities centre, both of which are still in the midst of construction. It also unveiled plans to develop a new research centre in Banyan.

Koon Holdings (S$0.20) 
Plans to buy 4 properties in JB  
Koon Holdings intends and plans to buy 4 properties in Malaysia for sale as commercial units belonging to two controlling shareholders and their family members for $17mil. It will be funded by a proposed three'for''ve rights share issue at 19 cents each. The de'nitive terms of the sales and purchase agreement are still being negotiated. The acquisition and rights issue are subject to the approval of independent shareholders at an extraordinary general meeting to be convened.

Cosco Corporation (S$0.965) 
Q2 pro't down 13% due to shipping slump  
Cosco Corporation reported 1H pro't attributable to equity'holders raised 'rst'half net pro't to $55.4mil but 20% lower than previously. Revenue made up about 98.5% of the quarter's revenue. Cosco Corp said the fall in turnover was due to lower revenue contribution from the ship building segment "which more than o'set the growth in revenue from ship repair and marine engineering segments". As at June 30, Cosco Corp's order book stood at US$5.9bil withprogressive deliveries up to 2014.
Source: The Business Times

Source: AmFraser