Singapore's 3Q corporate results season is still in progress. Thus far, the index's 13.26x (-0.5 SD) FY13F PE has been cut by 43pts to 3080 while that for 12.39x (-1 SD) FY13F PE is also lowered to 2880 from 2918. At the same time, inflation pressure returned with September CPI of 4.7% (consensus 4.3%) solidly higher than the 3.9% in August. We note that STI began underperforming regional peers after OMT & QE3 was announced in September. The index has been resilient thus far, likely because of the strong SGD and gradual growth prospect. But with STI's currently already trading at 'fair' valuation, the combination of earnings downward revision, inflation worries and the approach of the seasonal year-end lull could result in the STI consolidating lower. Technically, we see downside risk to 2985 or even as low as 2930.

CapitaMalls Asiareported a good set of 3Q results with a 71% rise in net profit to S$62.4m on a 53% increase in revenue to S$102m. The improvement came across all its investment and management fee businesses. CMA is moving into a sustainable earnings phase. China was the star performer, with earnings expected to accelerate. Going forward, we expect 4Q earnings to be boosted by the opening of the Star Vista in Singapore in Oct as well as 6 new malls in China. Maintain BUY, TP raised to S$2.15 (Prev S$ 2.08) as we adjusted our RNAV to S$2.68 to reflect higher TPs of listed associates.

Earnings for Neptune Orient Lines turned around in 3Q12 after 6 consecutive quarters of losses. But net profit of US$50m came in at the lower end of consensus estimates, as Asia-Europe rates slid faster than expected towards the end of the quarter. Profitability may not be sustained in the following quarters. With fuel prices holding up and disappointing trade data from Europe, we expect a core net loss of US$217m in FY12, and lower our FY13 net profit estimate by 10% to US$178m. Maintain HOLD; TP inched up to S$1.26 (1x P/BV) (Prev S$ 1.23) as we roll over to FY13.

4Q12 results for Frasers Commercial Trust in line; outlook remains stable. Following the sale of Keypoint, FCOT has also divested its Japanese properties, which is positive in our view, as management can now focus towards growing its portfolio in Singapore and Australia, which are core markets for FCOT. Maintain BUY, TP raised to S$1.30 (Prev S$ 1.26) as we roll forward our valuations. Stock offers attractive 5.8-6.3% yields.

Results for Mapletree Commercial Trust in line, 6-mth DPU makes up 49% of our FY13 numbers. MCT has strong operational and financial metrics. Gearing level is at 37.7% with only S$122m worth of refinancing due in April 2013. Acquisitions are likely to be the next catalyst. Maintain BUY, TP raised to S$1.35 (Prev S$ 1.14) as we roll forward our numbers and factor in S$1bn of acquisitions. Forward yield is at 5-5.2%.

Ascendas India Trust2Q13 results and DPU of 1.2 scts were in line. Recent equity raising of S$100m strengthens balance sheet; a-itrust is targeting opportunities to grow. Maintain HOLD, TP S$0.81 (Prev S$ 0.84).

Results for CapitCommercial Trust in line. 9M DPU makes up 78% of our FY12 forecast. Operational performance for CCT is strong, backed by high occupancy and positive rental reversions. Maintain HOLD at a higher S$1.50 TP (Prev S$ 1.41) on valuation ground. The stock now offers a forward FY13-14 yield of 5.2' 5.6% yield.

Results for Suntec Reit were slightly ahead of consensus. 9-mth DPU was 5% higher than our FY12 forecast. Suntec retail mall Phase 1 asset enhancement initiative (AEI) is going full steam, with pre-commitment healthy at 71%. Maintain BUY at a higher S$1.70 TP (Prev S$ 1.67). Forward yield is at 5.8-6.0%.

GMG Globalreported 3Q12 earnings of S$12.2m (-53% y-o-y; +6% q-o-q). Meanwhile 9M12 profit of S$35.4m represented only 64% of our full year forecasts. This was below expectations on an annualised basis. Gross margins continued to exhibit a downward trend consistent with increased contribution from the processing segment. 3Q12 gross margins stood at 10.8% down from 13.1% in 2Q12 and 15.3% in 3Q11. HOLD rating and TP of S$0.125 under review, pending analyst briefing today.

Koh Brothers Grouphas struck a deal with Metax Engineering for a proposed substantial stake in the environmental engineering company. Under a proposed subscription, Koh Brothers will subscribe for 155m new shares in Metax for $8.2m, or 5.3 cents a share, giving it a stake of 41% in Metax's enlarged share capital, or 34% on a diluted basis if existing warrants and specified proposed referral warrants in Metax are exercised by their owners. The subscription will come with 165m free three-year warrants for Koh Brothers, each convertible to a Metax share at an exercise price of 5.3 cents.

A new joint-venture company formed between Mermaid Maritime and a local offshore services operator has secured a significant long term offshore inspection, repair and maintenance services contract with a reputable client. The contract duration is for a minimum of five years plus a two-year option. The total contract value for the five year period is estimated to be approximately US$530m. Mermaid's potential revenue is between 60 to 70% of the said contract value over this period.

Ziwo Holdings, Eastgate Technology, Hengxin Technology and Frencken Group have issued profit warning for the upcoming results.

In property news, a new record price in terms of per square foot of land area is believed to have been set for a bungalow won Sentosa Cove. According to caveats evidence, a bungalow on Ocean Drive with views of the Pulau Brani container terminal was recently sold for $32.5m, which works out to $3,214 psf on land area of 10,111 sq ft. This busts the record set in late 2010 for a property just a few doors away that fetched $2,989 psf on land area of 9,436 sq ft, amounting to $28.2m.

Singapore's industrial output shrank 2.5% y-o-y in September. Electronics output last month failed to display any signs of the pick-ups that Taiwan and Korea have seen. Instead, it contracted 12.2% y-o-y, deeper than the 7.8% drop in August, and dragged factory output for the final month of Q3 into a surprise contraction. The electronics cluster accounts for a third of industrial output and contracted for an 18^th consecutive month. Contributing to the production decline was also a 6.9% y-o-y drop in biomedical output, after a 13.3% rise in August. Even after stripping out biomedical manufacturing, industrial output still fell 1.5% y-o-y. After seasonal adjustments, factory output fell 1.8% m-o-m. Excluding biomedical output, September's month-on- month decline was 0.4%. Transport engineering was the sole bright spot, expanding 16.1% y-o-y, thanks to new aerospace production capacity, higher rig building and increased production of oilfield equipment components.

Source: DBSV