Towards Financial Freedom
DBSV S'pore Wired Daily 21 October 2013
Today's Focus
Small Mid Caps - Recent sell down presents opportunity for quality small mid caps with superior growth & visibility.
We believe that small mid caps will continue to attract investors interest with its superior growth. Our universe of SMCs has packed in superior growth of 24% in 2014 vs 12% for Large Caps. Near term winners are potential earnings outperformers and strong growth. Our picks are Nam Cheong, Ezion, Goodpack, Centurion and Yoma. O&G still has legs to run, thanks to new contracts and strong earnings visibility. We like Ezion, Kreuz and Rex. Higher volume and lower costs are planting recovery for CPO stocks - We expect earnings for Bumitamaand Indo Agri to rebound strongly in FY14.
We are lowering our earnings estimates for Courts Asia for FY14F/FY15F by 10%/16% and TP to S$0.97 (Prev
S$1.05) as we envisage softer sales in Malaysia going forward and lacklustre sales in Singapore in the near term.
However, we are maintaining our BUY recommendation on the stock, as valuations are attractive vis-à-vis peers.
Ascott Residence Trust is reaping value from the sale of 81 serviced residence units in Beijing. The proceeds are to be redeployed to other value enhancing sources. Maintain BUY and TP S$1.42.
CapitaCommercial Trust's 3Q13 DPU of 2.04 Scts in line. Underlying portfolio occupancy shows strength. While
prospective yields of c5.6-5.9% are attractive, the execution of CapitaGreen, a year away from completion
and has yet to secure first tenant, is key for a sustained rerating of the stock. Maintain HOLD, TP revised to S$1.46 (Prev S$ 1.43) as we roll forward valuations.
Weak JPY has impacted the performance of Mapletree Logistics Trust; DPU of 1.82 Scts in line. We are tapering MLT's acquisition assumptions but expect more development projects to be unveiled to extract value. Maintain BUY with S$1.16 TP. Yield is attractive at 6.5%-6.9%.
Asiasons Capital and LionGoldCorp, along with Blumont, will have their trading restrictions lifted by the Singapore Exchange (SGX) today. The regulator said it would lift the restrictions as trading in these stocks has stabilised.
Rex International Holding restructures its holdings in US investments and increases stake in licence-holding company in Trinidad & Tobago. Rex US's 20% direct interest in Fram's Colorado and North Dakota concessions will be exchanged for equity stake in Fram. Rex's direct stake in Fram will be increased to 27.7%. Its stake in the licence-holding company Caribbean Rex will be increased to 64.17%.
SembCorp Industries will be investing RMB932m (S$190m) to develop the first - and its most comprehensive - total water management plant to support a coal-to-diesel project in China. The plant, to be located in Wangqiao Industrial Park in Changzhi City, Shanxi province, will support Shanxi Lu'an Group's coal-to-diesel project under a 15-year service agreement secured by Sembcorp's wholly owned subsidiary, Sembcorp China Holding.
The management of People's Food intends to make a voluntary conditional offer for all the remaining shares. The consideration for each Offer Share will be either S$1.20 in cash and/or One (1) new ordinary share in the capital of the Offeror.
Work on three MRT stations and a depot for the 30-kilometre Thomson Line will start in the first quarter of next year, with the Land Transport Authority (LTA) awarding four civil contracts for them worth a combined $1.04 bn. The three stations are Woodlands, Lentor and Mayflower, and the depot will be in Mandai.
China's annual economic growth quickened to 7.8% between July and September from 7.5% in the previous
three months, the fastest growth this year and in line with expectations. In the first nine months of 2013, China grew 7.7%from a year earlier. Meanwhile industrial output grew 10.2% in September from a year ago, versus expectations of 10.1%. Retail sales in September rose 13.3% y-o-y versus an expected 13.5%. Fixed-asset investment grew 20.2% in the first nine months from a year earlier, versus an expected 20.3%.
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
