Today's Focus 

• OCBC - FY16-17F earnings trimmed by 6-7% on slower loan growth, flattish NIM and higher credit costs. Maintain BUY, TP lowered to S$9.40 

OCBC's 4Q/FY15 earnings were above consensus but in line with our forecasts. Total oil & gas exposure at 6% of total loans; bulk of new NPL formation were from this sector. Our FY16-17F earnings are trimmed by 6-7% on slower loan growth, flattish net interest margin (NIM) and higher credit costs. Maintain BUY, TP lowered to S$9.40 (Prev S$10.00).

SembCorp Industries' net profit slid 75% y-o-y and 50% qo- q to S$60.8m in 4Q15, with the blame largely on the Marine losses (S$328m), and Impairment (S$70m) losses. On full year basis, net profit came in at S$549m (-32% y-oy). Utilities business was steady while the Marine unit was dragged by massive provision. SCI declared 6 Scts final dividend, bringing full year DPS to 11 Scts (including 5Scts interim dividend). This works out to be similar 36% payout ratio, translating to 4.4% yield. In response to SMM privatisation rumour, management stressed that any asset acquisitions should be accretive and return enhancing to SCI shareholders. In addition, there are more appealing opportunities in utilities space in view of the bleak marine outlook.

4Q15 operating net profit for CapitaLand came in at S$249.2m (-12% y-o-y) on the back of a 17% rise in top line to S$1,739m. The fall in net profit was mainly attributable to the one-off gain from the sale of Westgate Tower back in 4Q14. Recurring earnings forming 61% of net profit highlights improved earnings quality. We believe that CAPL offers compelling value, trading at an attractive 0.7x P/Bk and 0.6x P/RNAV. We maintain our BUY call with a target price of S$3.70.

We turn positive on Courts Asia as we see value in the current share price. The share price has corrected by -15% YTD and is trading at -1.5SD of its mean 3-year PE valuation and below peer forward PE average of 10x. While valuations remain attractive, Courts is also showing signs of earnings turnaround in FY16F. FY15 earnings have been dismal, registering both sales declines as well as higher labour and rental costs across Singapore and Malaysia. But a Malaysia led recovery in FY16F, especially in credit sales, has helped 9M16 earnings to outperform 9M15 by 49% y-o-y. Furthermore, its share buyback exercise has now led to a further 2.5% accretion to our EPS estimates. We find this significant vis-à-vis our core net profit growth of 4-6%.

Global Logistic Properties launches a second Japan fund with Canada Pension Plan Investment Board (50:50 JV). Seed portfolio is GLP Nagareyama (46% of properties under development in Japan). This could potentially increase GLP's AUM by 7% and management fees by 11%. Maintain Buy with target price of S$2.47.

The Stratech Group unveiled its three newly developed products - the Super EOSTM, iFerretTM Hydra and iFerretTM Mobile - for enhanced border and maritime surveillance as well as specific airport safety needs at the Singapore Airshow 2016 today.

OKP Holdings has been awarded a S$9.8m contract by PUB, the national water agency, for drainage improvement works at various locations in the western region of Singapore. First contract win in 2016, this contract will commence on 22 February 2016 and expected to be completed by the third quarter of 2018.

Singapore's NODX for January plunged 9.9% y-o-y, exceeding both the 7.6% tumble which the market is expecting and December's 7.2% drop. It was the NODX's third straight month of decline - and in line with the fall in exports of other key Asian exporters like China (-18.7%), Taiwan (-17.1%) and South Korea (-25.8%). Exports to China dived a worrying 25.2% in January - its worst performance in seven years. Month on month, the NODX bounced back from a seasonally-adjusted 2.6% slip in December to post a 0.7% growth in January - thanks to an increase in electronic NODX which outweighed the decline in non-electronic NODX.

US stocks rose after the latest FED minutes showed policy makers expressed concern that the fall in commodity prices and the rout in financial markets increasingly posed risks to the U.S. economy. This added further evidence that rate hikes will be put on hold at the March FOMC meeting. As a result, the unwinding of negative bets on stocks continued another day. Sentiment was also lifted by a rise in crude oil price after Iran said it supported a proposal by Saudi Arabia and Russia that would freeze production at near-record levels, without saying whether it would curb its own output.