The Singapore government will release the Population White Paper soon, which is expected to draw great interest. We are expecting c.7m population parameter. Medium term beneficiary will be the construction sector, while longer term transport, property and healthcare will benefit as well. LTA has started the ball rolling with announced plans for doubling of rail lines to 360km by 2030. Our picks are ComfortDelgro(BUY, TP: S$2.05) over SMRT (FV, TP: S$1.50), Pan United (BUY, S$1.02) and Tat Hong (BUY, S$1.80) over contractors and property plays.

Longer term, the oversupply of property seems to be less of an issue assuming a 7m parameter. However, recent policy measures may continue to cast a pall over stock price. Our picks are Wing Tai (BUY, TP: S$2.33) trading at 0.63x P/NAV, CapitaLand (BUY, TP: S$4.09) for its diversified exposure and Mapletree Commercial Trust (BUY, TP: S$1.35). Sin Heng (NR, Fair Value: S$0.29) and CordLife(NR, Fair Value: S$0.65) are other potential beneficiaries.

Sembcorp Industriesplans to expand its seawater desalination capacity in the UAE by 30%, after obtaining a 20-year water purchase agreement from the Abu Dhabi Water & Electricity Company (ADWEC). As this development is expected to materialize only 1H2015, we do not expect changes to current earnings forecast and TP.

According to the Hindu Business Line, the Indian government today imposed a 2.5% import duty on crude edible oil to protect domestic farmers (i.e. palm growers, particularly from Andhra Pradesh), but kept the duties unchanged on refined cooking oil, fearing a hike in retail prices. While we believe that the overall impact on Indian demand may not be severe and that other importing countries may not necessarily follow suit; this development sends negative signal on trade barriers. We expect CPO prices to remain range-bound until at-least May, when demand normally picks up again. Our current average CPO price forecast of RM2,940/MT now looks aggressive; and we are currently reviewing our forecasts. No change to ratings and TPs of counters in our coverage.

IEV Holdings has signed a supplemental agreement with PT Odira Energy Persada to extend the term of a Processing and Transport Agreement to 30 September 2013. The Processing and Transport Agreement was signed on 26 February 2007 for a period of 5 years and is for the processing of natural gas into Compressed Natural Gas (CNG) and the transportation of such CNG.

ICP Ltd, formerly the electronic component subcontractor Goldtron, has emerged with new shareholders, fresh capital and a new business focused on the offshore and marine (O&M) sector. The company, which is getting on board expertise from Chuan Hup and other marine sector entities, announced plans to buy into a company controlling two petroleum tankers. The cash and share purchase amounting to about $3m gives ICP a 51% stake in tanker owner GMT Group. The acquisition is being funded from the proceeds of a late-2012 rights issue, which saw the emergence of new shareholders led by Mercator Equity Pte Ltd.

Contel Corporationhas terminated the proposed placement agreement of 66m new shares entered on 16 January 2013.

CapitaLand Group'swholly owned serviced residence business unit, Ascott Ltd, has entered into a strategic alliance with Yuexiu Property to propel its expansion in China. Under the agreement, Hong Kong-listed Yuexiu Property will leverage on its footprint and expertise to acquire and develop serviced residences in China, while Ascott will manage the serviced residences.

Two new rail lines will be built and three existing lines extended to improve the coverage of Singapore's rail network. The rail network will be doubled by 2030, from the current 178 km to about 360 km, placing 8 out of 10 households within a ten-minute walk of a train station. The improvements will support Singapore's long-term development and ensure the network will have more than the capacity needed to meet the expected increase in public transport ridership in the next two decades.

GDP growth for China, to be released at 10am this morning, is projected to advance 8.0% YoY in 4Q12, from 7.4% in 3Q. Growth is set to conclude 2012 at 7.8%, beating the government's target of 7.5%.

US stock finished higher on better than expected December housing starts (actual 954k, consensus 890k) and initial jobless claims (actual 335k, consensus 369k). The Dow and S&P500 headed for a post GFC high that should underpin sentiment for Asian markets in early trade. Beyond the initial reaction, focus today will be on China's key data released this morning 10am - 4Q GDP, December retail sales & industrial production. The Chinese data should set the tone for the rest of the day.

Source: DBSV