STOCK IN FOCUS  
CACHE LOGISTICS TRUST 
We initiate coverage on Cache Logistics Trust (Cache) with a BUY and a fair value of $1.29  based on DCF. Backed by a quality por''olio of logistics warehouse assets, Cache is well'positioned to capture the growth opportunities presented by Singapore's development as a global logistics hub. Built'in rental escalation rates of 1.5'2.5% and the long'term nature of its triple'net master lease agreements underpin earnings resilience even in the face of subdued macroeconomic conditions. A forward FY2012'13 dividend yield of 7.0'7.3% further accentuates Cache's a''ractiveness. Moreover,  CWT has provided Cache with a strong pipeline of local and foreign acquisition assets by granting it a Rights of First Refusal (ROFR) on 13 properties, bolstering its inorganic growth plans.

KEY RISKS 
Overreliance on master lessees CWT and C&P for rental income.  Should CWT Limited and C&P fail to meet their lease obligations, this would severely impact Cache's bo''om'line and distribution income.  

Asset concentration risk.  Generating around 40% of its rental revenues from CWT Commodity Hub, Cache is largely exposed to risks that could adversely impact the operations or business of CWT Commodity Hub.

VALUATION 
DCF Valuation.  We derive a fair value of $1.29 based on a DCF model. Our model factors in a terminal growth rate of 1.5% and is based on the assumptions of a risk'free rate of 1.38%, a beta of 0.8, and country risk premium of 9.2%.

NEWS BUZZ
Singapore Exchange (S$6.96) 
Launches OTC Iron Ore and FFA options
SGX Singapore Exchange (SGX) launched its new OTC Options suite for SGX Iron Ore and SGX Forward Freight Agreements (FFA). "The SGX OTC Options complement the thriving SGX Iron Ore and FFA product suite and provide customers with a comprehensive suite of instruments for hedging, trading, and credit risk mitigation. Just as importantly, SGX customers are able to e'ciently clear their por''olio of commodities swaps and options with a single clearing house, and enjoy the bene't of margin o'sets between options and the underlying swaps," said SGX.

Popular Holdings (S$0.225) 
Q1 net down 36% to $6.6m
Popular Holdings' 1Q net pro't fell 36% year on year to $6.6mil, as revenue for the three months ended July 31 dropped 16% to $119mil. The company had registered higher turnover and earnings last year due to the sale of units in 18 Shelford.

Global Logistic Properties (S$2.39) 
Develop ind parks in China  
Global Logistic Properties (GLP) will begin to develop specialised industrial parks for the home appliance sector in China with Chinese home appliance maker Haier Group. The deal with Qingdao Haier Industrial Development Co, the industrial facilities arm of Haier, will entail GLP and Haier developing and operating logistics facilities across China for Haier. Both companies will also integrate strategic resources, including capital, land sourcing and management expertise, to build the industrial parks.

Electronic and high'tech products 'lled 17% of GLP's total leased area in China as at June 30, according to data from GLP. China contributed US$82mil to GLP's earnings before interest and tax, or about half of net pro't, in the quarter ended June. The company currently owns 11.5mil sq m    of gross 'oor area in the country, of which 6.5mil sq m are completed.

ST Engineering (S$3.43) 
Winds up Singapore British Engineering  
ST Engineering's aerospace arm, Singapore Technologies Aerospace Ltd (ST Aerospace) announced its 51%'owned subsidiary, Singapore British Engineering Pte Ltd (SBE) has commenced members' voluntary winding up.   ST Engineering said the voluntary liquidation of SBE is not expected to have any material impact on the consolidated NTA per share and EPS of the group for the current 'nancial year.
Source: The Business Times

Source: AmFraser