Towards Financial Freedom
DBSV S'pore Wired Daily 16 October 2013
Today's Focus
Singapore Exchange - Expect a soft quarter; maintain HOLD and TP S$7.15
Our analyst expects a softer 1QFYJun14 results (to be released on 17 Oct) for Singapore Exchange. Total revenues are expected to drop by 10% to S$182m, expenses to remain stable at S$81m, and net profit of S$84m for the quarter. Base DPS of 4 Scts is expected to be declared, similar to previous quarters. Daily average trading volumes have remained high (3Q13: 3.6bn) amid the strong market activity for small cap stocks during the quarter but average trading value for 3QCY13 declined 18% q-o-q to S$1.3bn (2Q13: S$1.6bn). Derivatives remain a key driver. Maintain HOLD; S$7.15 TP unchanged.
M1's 3Q13 net profit of S$39.5m (+19% yoy, +1% qoq) was inline with our estimates. 9M13 net profit of S$120m (+10% yoy) comprises 75% of our full year estimates. Postpaid gross ARPU of S$61.8 (-0.8% qoq) was 1-2% below our expectations due to sharper decline in roaming revenue. However, the impact on the profit was offset by lower handset subsidies. Potential hike in excess data charges, transformation into triple play (mobile, fixed broadband and pay TV) operator without incurring the content costs and net debt to EBITDA of only 0.6x are the key positives for the stock. Maintain BUY. SIIC Environment is proposing to place 3.1 bn new shares priced at S$0.085 per share. The issue price represents a discount of 13.0% to the las volume weighted average price. Net proceeds of S$260.2m will be used to finance the Group's business expansion and to enlarge the general working capital of the Group.
3Q13 DPU of 1.97 Scts for Keppel REIT in line. We expect robust occupancy levels with minimal refinancing risks in coming financial year. While stock offers an attractive FY13-15F yield of 6.4%-6.5%, given limited upside to our revised TP of S$1.23 (Prev S$ 1.19), we maintain our HOLD call.
Loyz Energy is proposing a private placement of 50m new shares at an issue price of S$0.35 per new share to raise a gross sum amounting to S$17.5m. The issue price represents a discount of approximately 9.8% to the last weighted average price. The net proceeds will enable the company to augment its working capital and give it the flexibility to apply to its existing projects now and in the future.
SIIC Environment is proposing to place 3.1 bn new shares priced at S$0.085 per share. The issue price represents a discount of 13.0% to the las volume weighted average price. Net proceeds of S$260.2m will be used to finance the Group's business expansion and to enlarge the general working capital of the Group.
ST Engineering announced that its aerospace arm, ST Aerospace has secured new orders worth about $600m in the third quarter of 2013. The new orders involve projects ranging from airframe, component and engine maintenance, to commercial airline cabin retrofit and freighter conversions.
PEC has added close to S$50m worth of contracts to its orderbook despite the difficult operating conditions in the industry. The latest wins include mechanical works for two refineries and supply of fabricated steel structures for global projects.
Chasen's contract winning momentum continues with the additional S$7.1m of new contracts, including maiden relocation project from the Middle East to Singapore, which paves the way for more projects in new countries. the Group expects the momentum to continue in both its Relocation and Technical & Engineering business segments over the remaining months of the financial year.
Pure Beauty Investments plans to acquire Catalist-listed Singapore Medical Group (SMG) for $16.67m. It intends to make a voluntary conditional cash offer for all of SMG's 145.74m issued and paid-up shares. The takeover offer price stands at about 11.44 cents per share, which represents a 4% premium above the last transacted price.
Nam Cheong is buying office space at Suntec Tower Three to house its Singapore corporate office for a price of about $30.3m. It has been granted an option-to-purchase (OTP) for three office lots (units #41-01 to #41-03) at Suntec Tower Three. The total floor space to be purchased is about 10,097 square feet and the property will have a lease that runs until Feb 29, 2088.
As part of a formal board succession plan that was put in place in July this year, two of Olam's longest-serving board directors will be stepping down on Oct 30. The changes will also see the appointment of a new independent director. Andy Tse Po Shing, who has served on the board for 11 years, will vacate his seat as non-executive and independent director. Sridhar Krishnan, who has been on the board for more than 15 years, will relinquish his appointment as executive director.
Source: DBSV
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