DBS Equity Research: Wired Daily 3 Dec 2014

kiasutrader

Publish date: Wed, 03 Dec 2014, 10:20 AM

Singapore will continue to invest in the O&G sector here despite recent oil price volatility

Boustead Singapore proposes demerger of its real estate solutions business and listing of wholly-owned subsidiary

SGX will delay the opening of the Singapore stock market on Wednesday to 12:30pm to let its members rectify errors from a software defect on Dec 1. The pre-open routine will begin at noon, and the market will remain open until 5pm and close as normal.

Separately, according to a Business Times article, SGX's massive system failure last month that paralysed trading on the local bourse for over 3 hours had stemmed from a glitch at the exchange's data centre housed in Keppel Digihub. Second Minister for Trade and Industry S Iswaran said there is little to worry about despite the recent oil price drop sending markets in the region into disarray. Short-term oil price volatility may not hamper the oil-and-gas industry for too long as the Singapore government continues to invest in the sector here. Iswaran pointed out that this region alone accounts for nearly a quarter of global E&P expenditure, which is expected to hit a record US$723bil in 2014. This continued growth in E&P activity is expected to support the growth of Singapore's offshore & marine industry

Singapore's PMI dipped slightly in November to 51.8 (consensus 51.5) compared to October's reading of 51.9. PMI for the electronics sector fell to 50.6 in November compared to 52.5 the previous month.

Keppel Landis investing US$47.4mil in a conditional JV agreement with ShweTaung Group, a major construction firm in Myanmar, to develop a 23-storey office tower in Yangon's central business district. Keppel Land will hold a 40% stake in the office tower, which is part of Junction City, a mixed-use development. The deal is subject to approval by the Myanmar Investment Commission.

Boustead Singapore is proposing the demerger of its real estate solutions business that would be consolidated under its wholly-owned subsidiary Boustead Projects, with an eye on listing shares in Boustead Projects on the mainboard of the Singapore Exchange. The restructuring would also involve a distribution in specie to Boustead shareholders of shares in Boustead Projects. Boustead's real estate solutions business is presently carried out largely by Boustead Projects and its subsidiaries. It added that the proposed transactions would unlock value for shareholders, in addition to allowing them to participate directly in the equity of Boustead Projects. Boustead stresses that the plans are at a preliminary stage.

U.S. stocks rose, led by biotechnology and energy companies and as data on construction spending boosted confidence in the economy. Meanwhile, 2 of the Federal Reserve's policy makers said sharply lower crude prices will boost spending and aid U.S. growth. Energy companies rebounded despite a decline in oil price with the West Texas Intermediate down 3.1%.

Source: DBS

Boustead (F9D)

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