STX OSV jumps after order win

Stock Name: STXOSV
Company Name: STX OSV HOLDINGS LIMITED

Research House: DMG

Price Call: HOLD

Target Price: 1.20

Shares of Singapore-listed shipbuilder STX OSV Holdings (STXO.SI) rose as much as 4% on Wednesday to a one-month high after the company said it secured a contract worth 1.2 billion Norwegian crowns ($264.71 million) for the construction of a research vessel.

At 9:45 a.m., shares of STX OSV were 3.1% higher at $1.16 with about 4 million shares changing hands.

“The new order is a positive surprise,” said DMG & Partners in a report, adding that it now expects STX OSV's order wins so far this year to be more than 7.4 billion Norwegian crowns, boosted by the latest contract.

DMG also raised its fiscal 2011 earnings-per-share estimate for STX OSV by 7%, and increased its share-price target to $1.20 from $1.14. It kept its neutral rating on the stock.

Ascott Residence Trust rated 'hold' by DBS

Stock Name: AscottREIT
Company Name: ASCOTT RESIDENCE TRUST

Research House: DBS Vickers

Price Call: HOLD

Target Price: 1.13

DBS Vickers Securities in a Nov 28 research report says: "Ascott REIT has entered into a conditional sale and purchase agreement to acquire a 60% interest in 160-unit Citadines Shinjuku Tokyo from Mitsubishi Estate Co Ltd (MEC).

"Purchase consideration amounts to JPY 2.6 billion ($45.7 million), implying an initial yield of 4.5%yield. While this is lower compared against our estimated WACC of 7.3% for the REIT, as the acquisition will be fully funded by debt, it should be accretive to earnings. Post acquisition ART's gearing level is expected to head slightly upwards to 42% (vs 41% previously).

"While stock offers a relatively attractive yield of 8.6, there exists potential downside risk in the event of a worsening European crisis, given that 42% of its assets are in Europe. Our target price has been revised to $1.13. DOWNGRADE TO HOLD."

UMS Holdings rated 'increase exposure' by SIAS

Stock Name: UMS
Company Name: UMS HOLDINGS LIMITED

Research House: SIAS

Price Call: BUY

Target Price: 0.79

SIAS Research in a Nov 24 research report says: "UMS ended the quarter with cash, net of leases, of S$32.4m, which is equivalent to 9.43 cents per share. Net cash now accounts for 24.8% of UMS's market value.

"As UMS has no bank borrowings except for $3.56 million of finance leases, the company can lever its balance sheet to make acquisitions of decent size. While UMS may be setting aside cash for potential M&As, we expect the company to maintain its quarterly dividends as its cash conversion ratio remained high at 94% in 3Q 2011. In a nutshell, the company is paying dividends out of its cash flow, which is a sustainable policy.

"We have reduced our earnings forecast for FY2011 and revised our valuation downwards to 79 cents in view of the last two quarters' results. MAINTAIN INCREASE EXPOSURE."

Macquarie Int'l Infrastructure Fund rated 'buy' by DBS

Stock Name: MacqIntInfra
Company Name: MACQUARIE INT'L INFRA FUND LTD

Research House: DBS Vickers

Price Call: BUY

Target Price: 0.64

DBS Vickers Securities in a Nov 28 research report says: "Over the years, MIIF has divested its non-Asian assets, and repaid corporate level loans with the sale proceeds, rendering a cleaner balance sheet with current net cash of about $115 million.

"The sale of stakes in other funds also eliminated the black box problem (assets with limited financial visibility) and the fund now focuses purely on key Asian infrastructure assets. MIIF paid out 3 cents dividend in FY2010. Post restructuring of its portfolio, MIIF is now guiding for 5.5 cents dividend per share in FY2011, based on expected cash flow generation plus existing cash reserves (2.75 cents already declared for 1H11).

"We expect this is achievable and given the healthy implied yield of close to 10.5% at current prices. Target price of 64 cents, based on DCF valuation of underlying assets. BUY (reinstating coverage)."

C&G Environmental Protection Holdings rated 'increase exposure' by SIAS

Stock Name: C&G EP
Company Name: C&G ENV PROTECT HLDGS LTD

Research House: SIAS

Price Call: BUY

Target Price: 0.21

SIAS Research in a Nov 28 research report says: "We like C&G exposure to the growing China waste to energy (WTE) industry which will benefit from rising waste generation per capita, rapid urbanization, limited land space around cities and energy shortage.

"Coupled with more upcoming projects over the next four years and preferential treatments such as better electricity tariff and tax reduction, the company is poised to benefit from these favorable industry developments. The company is merely trading at a FY12F P/B of 0.43X, which is significantly lower than its peers and does not reflect the industry's defensive nature.

"The company had also announced its intention to reward shareholders by distributing at least 20% of operating net profit between 2011 and 2013. Intrinsic value of 21 cents per share, upside of 61.5%. INCREASE EXPOSURE.

Tat Hong Holdings upgraded to 'outperform' by CIMB

Stock Name: Tat Hong
Company Name: TAT HONG HOLDINGS LTD

Research House: CIMB

Price Call: BUY

Target Price: 0.77

CIMB in a Nov 28 research report says: "Tat Hong has finally turned the corner, with growth finding footing. Its Australian operations are set to prosper in 2H12 from an ongoing re-building programme. We believe the next stock catalyst will hinge on that, potentially throwing up positive surprises in 2H12.

"Apart from rebuilding work following floods in Queensland that will be rolling in the dough, the lucrative oil & gas (O&G) industry in Australia may commence some projects after delays.

Once commenced, utilisation and rental rates could climb for Tat Hong. Earnings estimates are unchanged, so is our target price of 77 cents (10x CY13 P/E). UPGRADE TO OUTPERFORM."

Global Logistics Properties rated 'outperform' by CIMB

CIMB in a Nov 29 research report says: "GLP is the largest modern logistics provider in Asia, with the largest GFA (sq m) in China and Japan. We estimate that core EBIT will rise by 29% to US$520 million by FY14 vs. FY11, backed by stable rents in Japan and a growing portfolio in China.

"Operating cash flows are expected to cover known capex needs; a high cash conversion rate (short development cycle) allows available surpluses to be swiftly redeployed for new investments. A low net gearing of 0.3x implies additional investment capacity of US$1.7 billion, by our estimates.

"Target price/RNAV of $2.24. It trades at a 20% discount to RNAV and at more attractive multiples than its logistics peers. OUTPERFORM (initiating coverage)."

HG Metal Manufacturing rated 'overweight' by NRA Capital

Stock Name: HG Metal
Company Name: HG METAL MANUFACTURING LTD

Research House: NRA Capital

Price Call: BUY

Target Price: 0.138

NRA Capital in a Nov 29 research report says: "Revenue in 4QFY11 jumped 76% y-o-y (-2% q-o-q) to $66.1 million due to higher sales volume. Operating profit improved by about 350% to $1.7 million from a year ago, but declined 27% sequentially.

"Thanks to $1.5 million contribution from associate, HG Metal ("HGM") recorded $1.4 million PATMI, compared to $10.2 million loss last year arising from massive inventory write-down. HGM declared 0.6 cents of interim dividend, beating our estimate of 0.25 cents. We adjust FY2012-2013 earnings 20% lower.

"We keep our valuation method unchanged, pegging at 1x FY12NTA and thus deriving target price of 13.8 cents (prev 15.1 cents). Potential return is 69% (62% capital appreciation and 7% dividend yield). MAINTAIN OVERWEIGHT."

SG:Global Palm- Not expecting much expansion in 2012

Stock Name: Global Palm
Company Name: GLOBAL PALM RESOURCES HLGS LTD

Research House: OCBC

Price Call: HOLD

Target Price: 0.195

29 November 2011 : Global Palm Resources

Summary: Global Palm Resources (GPR) continues to disappoint with the pace of its new planting in 3Q11, where it added just 176 ha, bringing its YTD increase to 621 ha. Even though GPR has slashed its new planting target from 1.6-1.7k ha this year to 1k ha, it could still be a tall order as GPR would need to achieve 379 ha of new plantings in 4Q11. Management explained that the slowdown in new planting is an industry-wide trend, arising from Indonesia's two-year moratorium on new permits to clear primary forests and greater public and NGO scrutiny over new land opening. GPR has also lowered its new planting target for 2012 to just 770 ha. In view of the slow expansion so far and also the muted new planting target next year, we have reduced our FY12 revenue forecast by 9.3% and earnings by 8.4%. Applying an unchanged valuation of 10x against its FY12F EPS, versus blended FY11/FY12F EPS previously, our fair value drops to S$0.195 from S$0.21. Maintain HOLD.




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Pacific Andes target cut to $0.263 by OCBC

Stock Name: Pac Andes
Company Name: PACIFIC ANDES RESOURCES DEVLTD

Research House: OCBC

Price Call: BUY

Target Price: 0.263

OCBC Investment Research has cut its target price for Singapore-listed frozen fish supplier Pacific Andes Resources Development to $0.263 from $0.344 and kept its buy rating.

Pacific Andes’ full-year earnings, excluding a one-time charge for the early redemption of its sister firm China Fishery’s senior notes, was still lower than expectations due to a fall in gross profit margin to 21.5%.

OCBC has cut its fiscal 2012 earnings forecast by 17.6% to HK$705 million ($118 million), citing deteriorating outlook for the global economy and muted demand.

“While fish demand is fairly resilient, we expect current weak market conditions to translate into lower average selling prices later on,” said OCBC in a report.

At 11:11 a.m., shares of Pacific Andes were flat at $0.205, and have fallen 43% since the start of the year.

GLP started at outperform by CIMB

Stock Name: GLP
Company Name: GLOBAL LOGISTIC PROP LIMITED

Research House: CIMB

Price Call: BUY

Target Price: 2.24

CIMB Research has started coverage of Global Logistic Properties, which owns warehouses in Japan and China, with an outperform rating and a target price of $2.24.

GLP has the size and network in logistics to multiply its tenant base, given its ability to lease space to multinational corporations in important cities under the same landlord, said CIMB in a research report.

The company also works closely with the Chinese government to acquire land, which provides GLP with a development pipeline on top of the 5.1 million square meters of space it already has.

"It has unique exposure to China’s growth, backed by stable Japan cashflows and a highly competitive capital structure," said CIMB in a report.

It also added that GLP is trading at a 20% discount to its restated net asset value and at more attractive multiples compared to its peers.

At 11 a.m., shares of GLP were 0.3% higher at $1.795, but have fallen 16.4% since the start of the year.

Market Pulse: ST Engin, FCOT, Marco Polo Marine (25 Nov 2011)

Stock Name: ST Engg
Company Name: SINGAPORE TECH ENGINEERING LTD

Research House: OCBC

Price Call: BUY

Target Price: 3.01

Stock Name: Frasers Comm
Company Name: FRASERS COMMERCIAL TRUST

Research House: OCBC

Price Call: BUY

Target Price: 0.87

Stock Name: Marco Polo
Company Name: MARCO POLO MARINE LTD.

Research House: OCBC

Price Call: HOLD

Target Price: 0.43

Market Pulse: ST Engin, FCOT, Marco Polo Marine (25 Nov 2011)

FOCUS

ST Engineering: Recent decline provides better entry point

Summary: Despite Singapore Technologies Engineering's (STE) recent contract win worth S$441m, its share price has fallen in line with the weakness in the Singapore equities. The latest contract win constitutes the construction of eight 97.2m long Offshore Supply Vessels (OSV) with additional options for up to 24 vessels. STE's EPS growth has been relatively stable through the years, largely buoyed by its strong order book. As the global environment remains challenging, we continue to favour stocks with resilient earnings. At current price level, and with an estimated dividend yield of 5.6%, we reiterate our BUYrating on STE and maintain our fair value estimate of S$3.01. (Eric Teo)

Frasers Commercial Trust: Expecting better performance in FY12

Summary: Frasers Commercial Trust's (FCOT) FY11 DPU of 5.75 S cents came in within our and consensus expectations. Going into FY12, we maintain our view that FCOT may continue to post improvement in its operating performance, barring any fallout in the office rental market. According to management, China Square Central's average passing rents is below the recently contracted rents. With management's intention not to renew the lease but to take over the management of the property upon its expiry, we are likely to see further rental growth on this front. We also note that the group had recently secured a new A$105m loan facility. This facility, which will be used to repay the outstanding amount relating to its existing A$150m loan facility, has an interest rate based on Australian BBSY rate plus margin of 1.55% (vs. existing 2.65%). Hence, we may expect DPU uplift from interest savings. We make minor adjustments to our FY12 forecasts to factor in these recent developments. Retain BUY and DDM-based fair value of S$0.87. (Kevin Tan)

Marco Polo Marine: Declares S$0.01 special dividend

Summary: Marco Polo Marine (MPM) reported a 38% YoY rise in revenue to S$20.3m and a 27% increase in net profit to S$3.5m in 4QFY11, such that FY11 figures accounted for 101% and 93% of our full year estimates, respectively. Net profit was lower than expected mainly due to a higher effective tax rate of 28.4% in 4QFY11 compared to an average rate of 12.2% in 9MFY11; this was because of higher contributions from Indonesia and Australia which had higher corporate tax rates. Looking ahead, MPM expects its ship chartering results to be supported by its relatively young offshore business, while its shipyard is expected to deliver two additional units of offshore support vessels by 3QFY12. The group has declared a special dividend of S$0.01 per share for FY12, which will be paid on 22 Dec 2011.Our Hold rating and fair value estimate of S$0.43 is under review, pending an analyst briefing later in the afternoon. (Low Pei Han)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.


NEWS HEADLINES

- German Chancellor, Angela Merkel, stated that joint euro bonds would send a "wrong signal", dampening optimism about a potential remedy for the region's debt problems. The euro (against the dollar) touched a seven-week low after her comments.

- According to DTZ, buyers from mainland China have been snapping up homes in Singapore, accounting for 30.6% of all private home transactions in Q3, vs. 26% in Q1 and Q2.

- NH Ceramics posted net profit of S$511k for FY11, down c.44%. This is partly due to lower sales from supplying building materials.

- Heng Long International, the crocodile skin tannery, moves closer to delisting as SGX raised no objections against its proposal. LVMH launched a takeover bid for Heng Long in Oct, offering S$160.8m.

- SingTel Optus has priced an A$75m, seven-year fixed rate note issue. The notes are to be issued on 5 Dec 2011 and will extend Optus's maturity profile as well as add diversity to its debt structure, according to SingTel.

- Even as liquidators of MF Global reported progress in winding down the business, customers of MF Global Singapore are still waiting to recover approx. US$307m, before monies and assets can be released.

IIFL downgrades SGX to sell from reduce

Stock Name: SGX
Company Name: SINGAPORE EXCHANGE LIMITED

Research House: IIFL

Price Call: SELL

Target Price: 5.44

IIFL has downgraded Asia’s second-largest listed bourse Singapore Exchange (SGX) (SGXL.SI) to sell from reduce and cut its target price to $5.44 from $6.12.

IIFL has cut its net profit estimate for SGX by 7% for fiscal 2012 and 2% for 2013 to reflect a decline in securities volume.

The brokerage has also lowered its estimate for the average daily turnover for SGX’s securities business for 2012 by 13% to $1.4 billion, which is 14% below the year ago.

“Gloomy outlook for global and Asian stock markets continues to weigh down on SGX securities turnover,” said IIFL in a report.

 

At 10:04 a.m., shares of SGX were 0.33% higher at $6.06, but have fallen 28% since the start of the year.

Ramba Energy rated 'increase exposure' by SIAS

Stock Name: Ramba
Company Name: RAMBA ENERGY LIMITED

Research House: SIAS

Price Call: BUY

Target Price: 0.80

SIAS Research in a Nov 21 research report says: "Ramba 3Q revenue grew by a robust 100.5% y-o-y to $25.8 million mainly due to higher contribution from the logistic services segment.

"Over the past two months, Ramba announced (1) the production of gas from JRR-7 development well which is reported to have sales gas flow of about 4.0m std cubic feet per day (mmscfd) and (2) the drilling of JRR-6 development well to its target depth of 1298m with production testing to follow up. The former's production rate exceeded the management's expectation by 100% and the Jatirarangon Block is projected to produce 8.8mmscfd by end of the year.

"Ramba has about $12.8 million cash as of 3Q 2011 and may generate another $10 million operating cash flow next year from the Jatirarangon Block and the logistic business. Intrinsic value of 80 cents.MAINTAIN INCREASE EXPOSURE."

Noble Group rated 'buy' by Nomura

Stock Name: Noble Grp
Company Name: NOBLE GROUP LIMITED

Research House: Nomura

Price Call: BUY

Target Price: 1.70

Nomura Research in a Nov 22 research report says: "Noble's weak 3Q (losses of USD27 million, gross profit declined 45% y-o-y and 45% q-o-q) and the CEO's exit has led to sharp negative sentiment. The stock has traded 6% of its market cap over last week and is down 30% since results.

"Though we think earnings will rebound sharply in CY12 (4Q may see some recovery), the poor results and the management departure overhang may prevent significant re-rating in the near term. Positively, 3Q volume growth was strong (34% y-o-y and 25% q-o-q), showing strong business reach.

"After correcting recently, Noble now trades at YTD lows and post-crisis trough valuations. We think the floor is near, and these are good entry points for long-term exposure. We cut our CY12F earnings by 14%. Target price of $1.70. MAINTAIN BUY."

Cambridge Industrial Trust rated 'buy' by DBS

Stock Name: Cambridge
Company Name: CAMBRIDGE INDUSTRIAL TRUST

Research House: DBS Vickers

Price Call: BUY

Target Price: 0.58

DBS Vickers Securities in a Nov 21 research report says: "Cambridge REIT (CREIT) announced the proposed acquisition of 3C Toh Guan Road East, an industrial building comprising of a 5-storey warehouse building and an ancillary office for a consideration of $35.5 million ($36 million, including attributable fees).

"We understand that the acquisition will be mainly funded by cash on its balance sheet, which we view as a positive catalyst, since this has been a drag on share price performance; the REIT faced a couple of delays in completing its acquisitions announced previously, resulting in lower than optimal distributions.

"This acquisition is estimated to boost DPU by 0.24 cents when completed in 1Q12, which we have already factored in our numbers. CREIT currently offers a FY2011-2013F DPU yield of 9.1-10.7%. Target price of 58 cents. MAINTAIN BUY."

OCBC raises Lian Beng target price

OCBC Investment Research has raised its target price for Singapore construction firm Lian Beng Group (LIBG.SI) to $0.55 from $0.51 and maintained its buy rating.

OCBC has raised its earnings estimates for Lian Beng in 2012 by 8% and 17% for 2013, to account for strong sales in its industrial development in Mandai, Singapore.

Lian Beng has also acquired a new residential development site in the city-state for $130 million, and OCBC said it was confident the firm will be able to execute its commercial and housing projects well.

“We believe these developments are positives for Lian Beng, as both are good locations and offer Lian Beng chances to add construction projects to their order books,” said OCBC in a report.

At 9:46 a.m., shares of Lian Beng were flat at $0.345, and have gained 13.1% since the start of the year.

Market Pulse: Commodity Sector & Lian Beng (24 Nov 2011)

Stock Name: Lian Beng
Company Name: LIAN BENG GROUP LTD

Research House: OCBC

Price Call: BUY

Target Price: 0.55

Market Pulse: Commodity Sector & Lian Beng (24 Nov 2011)

FOCUS

Commodities Sector: Outlook remains mixed at best

Summary: Looking back at the Sep quarter results, soft commodity plays under our coverage generally did better, with most coming close to our expectations. Meanwhile, the biggest surprise came from Noble, which reported a net loss of US$17.5m - its first in 14 years. In any case, even for those companies that performed within expectations, we note that there were increased signs of margin pressures, despite healthy volume growths. Renewed weakness in the US economy and uncertainties over the EU sovereign debt issues have exacerbated the risk of the economy slipping into a "down cycle". Even though we maintain a NEUTRAL weight on the sector, we attach a downside bias to our rating, as we could see a faster-than-expected deterioration in the global economies, especially in China. Our pick in the sector is Golden Agri. (Carey Wong)

Lian Beng: Another new addition for development.

Summary: Lian Beng recently announced that it has acquired the site of Dragon Mansion at Spottiswoode Park Road for S$130m. Together with its recent Midlink Plaza acquisition, the group has deployed around S$260m in recent months to acquire land resources. Given these sites' good locations and the potential opportunity for LBG's construction arm to win the related construction contracts, we believe these additional development resources are positive for the group. We factor in the financial impacts of these new sites and its strong sales so far for Mandai Industrial development and this raises our earnings estimates for FY12/FY13 by around 8% and 17% respectively. This in turn raises our fair value estimate to S$0.55, implying potential upside of 60%, therefore, maintain BUY. (Benjamin Lim)

For more information on the above, visit www.ocbcresearch.comfor detailed report.

NEWS HEADLINES

- The European crisis worsened further after a German government bond auction flopped with only EUR 3.64b out of EUR 6b worth of 10-year bunds taken up by investors.

- European banks clamoured for emergency funds from the ECB on Tuesday, borrowing the most since early 2009 in a clear sign that the eurozone's financial institutions are having trouble obtaining credit at reasonable rates in the open market.

- Singapore's inflation remains stubbornly high at 5.4% in October, on the back of higher rentals, transport and food costs.

- On the first day of the property's launch, Capitaland sold more than 350 apartments in its 583-unit Bedok Residences condominium with an average selling price of S$1,350 psft.

- Newly listed property and construction group TA Corporation has secured two new construction contracts from Allgreen Properties and its subsidiary worth S$271m.

- Hisaka Holdings' net profit for the fiscal year ended Sep 30, 2011 dropped 30.5% YoY to S$6.4m, mainly due to the slowdown in global manufacturing. It has also proposed a final dividend of half a cent per share.

Samsung starts NOL at buy, target $1.50

Stock Name: NOL
Company Name: NEPTUNE ORIENT LINES LIMITED

Research House: Samsung Securities

Price Call: BUY

Target Price: 1.50

Samsung Securities has initiated coverage of Singapore container shipping firm Neptune Orient Lines (NOL) (NEPS.SI) with a buy rating and a target price of $1.50.

Samsung said it expects NOL to be one of the companies most positively affected by the short-term improvement in sentiment towards the liner sector, which could begin early next year due to tighter supply in the industry.

NOL has also increased its exposure to the growing intra-Asian trade lanes, which should benefit the company in the face of upcoming capacity constraints, Samsung said.

In the longer term, the brokerage said it also expects NOL’s fleet replacement programme and the flexibility it has over controlling its capacity should lower its costs by about 15%.

At 10:24 a.m., shares of NOL were 2.5% higher at $1.03, but have plunged 53% since the start of the year.

STX OSV Holdings rated 'buy' by DBS

Stock Name: STXOSV
Company Name: STX OSV HOLDINGS LIMITED

Research House: DBS Vickers

Price Call: BUY

Target Price: 1.54

DBS Vickers Securities in a Nov 21 research report says: "STX OSV announced that the contract for 8 LPG carriers for Petrobras Transportes S.A. (Transpetro) has been made effective. This contract will boost the group's FY2011 YTD order wins to NOK8.6 billion, forming 91% of our full year order wins assumption of NOK9.5 billion.

"We estimate STX OSV's orderbook now stands at NOK17.1 billion, vs. NOK13.6 billion as of end 3Q11, after including the Transpetro contract and the other 2 contracts secured in 4Q11 to date. Book-to-bill has been lifted to c. 1.5x from 1.2x previously. No change to our numbers, as this contract was already in our forecasts.

"However, this removes an ongoing concern among investors over the repeated delays in the contract being made effective. Target price unchanged at $1.54. MAINTAIN BUY."

Super Group rated 'outperform' by RHB

Stock Name: SuperGroup
Company Name: SUPER GROUP LTD.

Research House: RHB

Price Call: BUY

Target Price: 1.70

RHB Research in a Nov 18 research report says: "Super Group, based in Singapore, is an instant F&B brand owner and manufacturer of more than 200 instant beverages and convenient food products which is distributed worldwide.

"For FY2011-2013, we are forecasting an earnings CAGR of 17.3%, on the back of a revenue CAGR of 16.1%, driven by: (1) stable growth and market share across its key markets of 9-10% for Malaysia, Singapore, and Thailand and 1% for Myanmar; (2) Increased sales of its ingredients segment sales with a CAGR of 22.9%; and (3) Revenue boost from sales in Indonesia through its JV with Petra Foods.

"We are valuing Super at $1.70 based on a target of 14.5x FY12 PER. Our target PER is in line with Super's regional F&B peers which are currently averaging 14.5x FY12 PER. OUTPERFORM. (initiating coverage)."

Lian Beng Group rated 'buy' by Kim Eng

Stock Name: Lian Beng
Company Name: LIAN BENG GROUP LTD

Research House: Kim Eng

Price Call: BUY

Target Price: 0.62

Kim Eng Research in a Nov 22 research report says: "Lian Beng's 50:50 joint venture with Centurion Properties bought the 68-unit, freehold Dragon Mansion at Spottiswoode Park for $130 million last week.

"The redevelopment can yield 118,943 sq ft of GFA, implying a sale price of $1,093 psf ppr and an estimated breakeven of $1,580 psf. With the addition of Dragon Mansion, Lian Beng has an attributable unsold landbank of 84,574 sq ft.

"We expect the group's earnings to continue to be largely (over 60%) driven by construction, backed by a strong orderbook of $761 million excluding the expected contracts from Mandai Estate ($66 million including the construction of worker's dormitory), Midlink Plaza ($45 million) and Dragon Mansion ($42 million). Target price of 62 cents, pegged at 6x FY May12F PER. MAINTAIN BUY."

PEC rated 'trading buy' by CIMB

Stock Name: PEC
Company Name: PEC LTD.

Research House: CIMB

Price Call: TRADING BUY

Target Price: 0.84

CIMB in a Nov 23 research report says: "Backed by net cash of 61 cents per share and net working capital of 55 cents per share, we see value emerging after its recent underperformance.

"PEC is only trading 11% above its net cash and 23% above its net working capital, implying an attractive risk-reward trade-off. We do not expect current net cash of $156 million to slip. We believe net cash can be sustained at $140 million-$160 million for FY2012-2014, even after factoring in some normalisation of working-capital management.

"It is the only stock trading at a 20% discount to book, even though its projected ROE could pass the COE hurdle rate. We cut our FY2012-2014 EPS by 4-27% as we dampen our margin expectations. Target price of 84 cents, still based on 1x CY12 P/BV. TRADING BUY."

Sapphire Corporation rated 'increase exposure' by SIAS

Stock Name: Sapphire Corp
Company Name: SAPPHIRE CORPORATION LIMITED

Research House: SIAS

Price Call: BUY

Target Price: 0.60

SIAS Research in a Nov 22 research report says: "Sapphire is currently trading at just 0.41x its common equity per share of 33 cents - more than fully discounting the book value (and upside potential) of its unlisted investments.

"Sapphire's 70% owned core vanadium and steel operations turned in an estimated net profit of >$4.0 million at the subsidiary level in 3Q FY2011. From 2012, more profit will accrue to Sapphire as it raises its stake in core subsidiary (Special Steel) from 70% to 100%.

"Growth for 2013 is being put in place with plans to introduce new products, e.g. silicon steel at the end of 2012, being ironed out at the moment. Sapphire's cash flow remains robust with $6.1 million and $22.2 million of operating cash flow before working capital changes for 3Q 2011 and 9M 2011 respectively. Intrinsic value of 60 cents. MAINTAIN INCREASE EXPOSURE."

ISDN Holdings rated 'overweight' by NRA Capital

Stock Name: ISDN
Company Name: ISDN HOLDINGS LIMITED

Research House: NRA Capital

Price Call: BUY

Target Price: 0.22

NRA Capital in a Nov 23 research report says: "9M11 net profit of $7.4 million (18% y-o-y) is slightly below our expectation of $7.9 million due mainly to lower-than-expected revenues and gross profit margins. However, these were partially off-set by gains from forex and properties sold by a subsidiary. 9M11 result represents 69% of our full-year forecast.

"Sales inched up 10% y-o-y to $129.8 million, on the back of higher motion control demand in China. We have cut our FY2011 forecasts by 24% and trimmed FY2012-2013 by 5-7% given the sharp fall in semiconductor sales was greater than our expectation.

"Our fair value has lowered from 29 cents to 22 cents after changing our valuation model from 8x FY11 PER to 1x FY12 P/NTA, lowest range of its 6 years historical. Upside of 64% with reasonable yield of 3.8%. OVERWEIGHT."

Anwell Technologies rated 'overweight' by NRA Capital

Stock Name: AnwellTech
Company Name: ANWELL TECHNOLOGIES LIMITED

Research House: NRA Capital

Price Call: BUY

Target Price: 0.43

NRA Capital in a Nov 18 research report says: "Despite higher-than-expected sales and excluding the gains on revaluation, 3Q11 core net loss of HK$217 million was 380% wider than our net loss forecast.

"The key variances were lower-than-expected gross margins, higher operating expenses, depreciation & amortisation, finance costs and taxation. 3Q11 sales surged 99% yoy to HK$453m with increased contribution from all its business divisions.

"We have revised our FY2011 net loss from HK$23 million to net profit HK$55 million after factoring in gains on revaluation but revised to net loss in FY2012 due to start-up costs and higher depreciation for its Dongguan plant that management expects to come onstream in 2H12. Our fair value has been lifted by 4 cents to 43 cents, still pegged at 0.9x P/NTA. OVERWEIGHT."

Serial System rated 'increase exposure' by SIAS

Stock Name: Serial
Company Name: SERIAL SYSTEM LTD

Research House: SIAS

Price Call: BUY

Target Price: 0.172

SIAS Research in a Nov 7 research report says: "Serial made three proposed acquisitions over the last three weeks.

"The three acquisitions, costing a total of $5.6 million, will allow Serial to (a) penetrate the Korean automotive industry and "small manufacturer market", (b) acquire two major branded Taiwan manufacturing customers and (c) take over a ready customer base in Korea to distribute the National Semiconductor brand of products.

"Serial reported a 2.3% y-o-y decline in revenue for 3Q FY11 - from $195.0 million in 3Q FY10 to $190.4 million in 3Q FY11. We adjusted our revenue and PATMI forecasts for FY2011 to $770.0 million and $13.1 million respectively and reduced our intrinsic value to 17.2 cents per share.MAINTAIN INCREASE EXPOSURE."

Tee International rated 'buy' by OCBC

Stock Name: Tee Intl
Company Name: TEE INTERNATIONAL LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.34

OCBC Investment Research in a Nov 16 research report says: "TEE built up its M&E engineering and general construction business over the years with many notable projects, including Marina Bay Sands.

"We like TEE for (1) its track record in the defensive M&E space, (2) its regional footprint providing it with opportunities to win contracts beyond Singapore, and (3) the healthy growth prospects of both its M&E and property development businesses.

"We adopt a SOTP valuation methodology to value TEE - a multiple based approach applied to value its M&E/construction business (5x P/E ratio on FY2012 estimates) and a RNAV approach for its development arm.

"We derive a fair value estimate of 34 cents, implying upside of around 41%. We also like TEE for its decent dividend payout, and based on our EPS estimates, it can potentially offer 5%-7% dividend yield. BUY (initiating coverage).

Consciencefood Holdings rated 'buy' by DMG

Stock Name: Consciencefood
Company Name: CONSCIENCEFOOD HOLDING LIMITED

Research House: DMG

Price Call: BUY

Target Price: 0.29

DMG & Partners Research in a Nov 17 research report says: "Consciencefood reported a 194% y-o-y rise in 3Q11 PATMI to Rp32.2 billion (+194% y-o-y) which was achieved on the back of a 30% rise in revenue to Rp183.4 billion. Results were above expectations.

"9M11 PATMI of Rp94.6 billion accounted for 87% of our FY2011F while revenue of Rp563.8 billion accounted for 80% of our FY2011 forecast. We increase our FY2011F revenue and earnings forecast by 2% to take into account higher sales of instant noodles which would be offset by the delayed production of its beverage line.

"With two new avenues of sales coming on stream next year and growing instant noodle sales, we remain optimistic on the stock. Unchanged target price of 29 cents, pegged at 7x FY2011F earnings. MAINTAIN BUY."

Lippo Malls Indonesia Retail Trust rated 'buy' by OCBC

Stock Name: LippoMalls
Company Name: LIPPO MALLS INDO RETAIL TRUST

Research House: OCBC

Price Call: BUY

Target Price: 0.45

OCBC Investment Research in a Nov 17 research report says: Lippo Malls Indonesia Retail Trust's (LMIRT) 3Q11 DPU of 1.06 cents was slightly below our expectation due to higher-than-expected tax expense.

"However, gross revenue of $33.3 million (-1.4% y-o-y) and NPI of $22.5 million (+1.2% y-o-y) were ahead of our projections, notwithstanding a negative impact from a depreciating IDR against SGD. For 9M11, revenue of $99.2 million and DPU of 3.32 cents formed 78.9% and 71.6% of our full-year revenue and distribution figures, respectively.

"We factor in the contributions from the two new malls (Pluit Village and Plaza Medan Fair) and rights issue, as the acquisitions are expected to complete on Dec 9. Our fair value is now adjusted from 61 cents to 45 cents (based on DDM), potential upside of 26.3%. MAINTAIN BUY."

Ezion Holdings rated 'buy' by DBS

Stock Name: EzionHldg
Company Name: EZION HOLDINGS LIMITED

Research House: DBS Vickers

Price Call: BUY

Target Price: 0.96

DBS Vickers Securities in a Nov 16 research report says: "Ezion delivered core 3Q11 PATMI of US$12.9 million (+69% y-o-y, +6% q-o-q), slightly ahead of expectations. This was mainly on higher contributions from liftboat #4, which commenced operations within the period.

"Given the strong 3Q11, our FY2011F is tweaked +1%, while FY12/13F are cut by 3%/12% from removing the marine bases' contributions. Partially offset by Liftboat #7 which should kick in from 2H2013 onwards, Ezion is still projected to post healthy FY2011-2013 EPS CAGR of 27%.

"We estimate that our FY2011-2013F profit before tax are 97%/75%/76% backed by secured contracts/ LOIs. Our target price is adjusted to 96 cents as we roll forward our valuation to FY2012, pegged to 9x PE in line with its historical average. MAINTAIN BUY."

Hong Leong Asia rated 'underperform' by CIMB

Stock Name: HL Asia
Company Name: HONG LEONG ASIA LTD.

Research House: CIMB

Price Call: SELL

Target Price: 1.66

CIMB in a Nov 14 research report says: "9M11 core profit is below, at 64% and 56% of CIMB and consensus estimates. Core earnings this quarter were only $1.8 million, after stripping out a $26 million gain from the sale of the Karriumun quarry.

"Results were dragged down by a $13.8 million bust demand from the construction industry. Xinfei reported a $13.8 million loss for 3Q and $31.4 million loss for 9M11. Unit sales declined 9% vs. the 50% growth for the industry in the quarter.

"HLA's new CEO plans to turn around the unit by developing differentiated products; however, a combination of near-term competitive pressures, the expiry of rural subsidies and upcoming cold season in China could continue to weigh on Xinfei. Target price of $1.66. MAINTAIN UNDERPERFORM."

Genting Singapore rated 'buy' by DMG

Stock Name: Genting SP
Company Name: GENTING SINGAPORE PLC

Research House: DMG

Price Call: BUY

Target Price: 2.14

DMG & Partners Research in a Nov 14 research report says: "The group's annualized 9MFY11 adjusted EBITDA of $1,669.4 million represented 97.4% of our full-year forecast, which we deem largely in line with both our and consensus forecasts.

"We see a stronger sequential 4Q11 performance, partly driven by the holiday season and ramping up of casino and room capacity. The stock, at a FY2012 EV/EBITDA of 10.1x, is trading at a 17% to 21% discount to its Macau gaming peers, which has more than priced in the relatively slower gaming growth in Singapore relative to Macau.

"The eventual legalization of junkets in Singapore, on which management is optimistic on materializing soon, as well as new VIP room capacity coming on stream in 4Q11, may be a key re-rating catalyst. Fair value at $2.14 (13x FY12 EV/EBITDA). MAINTAIN BUY."

Adampak rated 'buy' by DMG

Stock Name: Adampak
Company Name: ADAMPAK LIMITED

Research House: DMG

Price Call: BUY

Target Price: 0.31

DMG & Partners Research in a Nov 15 research report says: "Adampak's 3Q11 PATMI of US$1.6 million (-28.2% y-o-y) came in within expectation. Gross margin fell by 3.7ppt as a result of some forex losses while revenue stream remained stable.

"FY2012 is expected to be a strong year compared to FY2011. We believe that the business is in good hands as the management put great emphasis on risk control as they steer the company through a volatile period. Target price of 31 cents based on our Discount Dividend Model.

"Adampak still managed to generate a net cash flow of US$0.3 million for 9MFY11, making its net cash balance to hit a record high of US$13.0 million, equivalent to 6.4 cent per share. We think the group is able to sustain a steady dividend payout of more than 60% of its earnings, which works out to a yield of 9%. MAINTAIN BUY."

Gallant Venture rated 'buy' by DBS

Stock Name: Gallant
Company Name: GALLANT VENTURE LTD.

Research House: DBS Vickers

Price Call: BUY

Target Price: 0.88

DBS Vickers Securities in a Nov 14 research report says: "Gallant Venture (GALV) reported 3Q11 net loss of $0.6 million (vs $8.1 million profit in 3Q10) on top of a 30% decline in topline to $47.5 million. This was mainly due to lower recognition from land sales in this quarter ($1.4 million vs $20.6 million in 3Q10).

"Performance of its industrial parks and utilities continue to remain stable. Operational expenses were slightly high owing to higher marketing commissions and professional fees incurred, resulting in a net loss of $0.6 million in 3Q11. On the balance sheet front, net debt was fairly stable $178.7 million, even after accounting for $39 million loan repayment.

"NAV was 51 cents per share. We continue to see latent value in GALV, with potential land sales supported by the completion of Lagoi Bay Mall by 1Q12. Target price of 88 cents. MAINTAIN BUY."

Armstrong Industrial Corp rated 'hold' by Kim Eng

Stock Name: Armstrong
Company Name: ARMSTRONG INDUSTRIAL CORP LTD

Research House: Kim Eng

Price Call: HOLD

Target Price: 0.19

Kim Eng Research in a Nov 14 research report says: "Armstrong's 3Q11 results were hard hit by a weak US$, mark-to-market losses on forward forex contracts and higher material costs.

"We expect the next two quarters to remain weak due to the perfect storm of earthquake and flooding; 4Q11 in particular could be marked by asset impairment losses due to the Thai flooding. However, operating cash flow stayed strong and Armstrong could still declare a dividend, albeit much reduced from last year's $0.04 per share.

"We cut our earnings forecasts by 47% for FY2011 and 27% for FY2012, and switch to book value valuation. Assuming 0.9x FY12F BVPS of $0.217, our target price is reduced to 19 cents. The stock is trading at around BVPS of $0.195 and almost 5% dividend yield. MAINTAIN HOLD."

Boustead Singapore rated 'buy' by Kim Eng

Stock Name: Boustead Sp
Company Name: BOUSTEAD SINGAPORE LIMITED

Research House: Kim Eng

Price Call: BUY

Target Price: 1.32

Kim Eng Research in a Nov 15 research report says: "Boustead experienced a slow second quarter with revenue coming in at $91.0 million (-30.3% y-o-y, +0.3% q-o-q) and net profit at $9.1 million (+12.7% y-o-y, +7.0% q-o-q). Net profit of $17.6 million for 1HFY Mar12 made up about 38% of our full-year forecast.

"We expect its strong outstanding orderbook of $335 million to bolster the second half year to make up for the weak first half. An interim dividend of 2 cents per share was also declared. We cut our FY Mar12-14 net profit forecasts by 1-8% but continue to expect a stronger 2HFY Mar12.

"We have also made minor adjustments to our RNAV valuation for the Real Estate Solutions division. Our SOTP-based target price is thus lowered to $1.32 from $1.36 previously. Dividend yield remains attractive at 6.1%. MAINTAIN BUY."

Olam International rated 'hold' by DBS

Stock Name: Olam
Company Name: OLAM INTERNATIONAL LIMITED

Research House: DBS Vickers

Price Call: HOLD

Target Price: 2.35

DBS Vickers Securities in a Nov 15 research report says: "Olam reported earnings of $34.2 million (+15% y-o-y, -73% q-o-q) representing 8% of our FY2012 forecast, which was at the top end of typical 1Q contribution range of 5-8%.

"With 1QFY12 results above expectations, we raised FY2012-2014F by 1-15% imputing higher NC/MT of $124-135 versus $116-133 previously. Our target price is raised accordingly to $2.35 from $2.15. Despite strong performance amid extreme volatility and macro uncertainty in 1QFY12, we maintain hold rating for Olam due to limited catalysts in the near term.

"Its projected 26.9% 3-year core earnings CAGR and business resilience (exposure to food demand) have been priced in. However, financial close of Gabon urea project in 1HCY12 could reap potential upside of 47 per share. MAINTAIN HOLD."

Cerebos Pacific rated 'outperform' by CIMB

Stock Name: CerebosPac
Company Name: CEREBOS PACIFIC LIMITED

Research House: CIMB

Price Call: BUY

Target Price: 6.65

CIMB in a Nov 14 research report says: "3Q11 and 9M11 profits are broadly with market and our expectations, at 22% and 70% of our FY2011 estimate. 3Q revenue was flat y-o-y as higher sales of Health Supplements $140.2 million (+6% q-o-q) were offset by lower sales of $93.8 million (-8% q-o-q) in the Food & Coffee division following the discontinuation of its Riva range of products.

"Operating profit dipped to $31.3 million (-3% q-o-q), excluding a translation loss of $0.5 million. We adjust our FY2011-2012 estimates to capture lower sales in Thailand and Taiwan.

"Sum-of-the-part target price of $6.65. We expect its dividend payout of 25 cents to be sustainable on the basis of net cash of $89 million as at end-September. MAINTAIN OUTPERFORM."

Amara Holdings rated 'outperform' by CIMB

Stock Name: Amara
Company Name: AMARA HOLDINGS LTD

Research House: CIMB

Price Call: BUY

Target Price: 0.47

CIMB in a Nov 11 research report says: "9M11 earnings form 48% of our FY2011 estimate. This is broadly in line as we expect back-loaded contributions from residential sales.

"We view this positively as higher hotel revenue more than offset the absence of rental income from Amara Shopping Centre (closed for renovation in Jun). Earnings increased slightly y-o-y due to lower depreciation charges and taxes.

"We cut our FY2011-2013 to factor in a slowdown in RevPar growth and lower our target price to 47 cents from 31 cents (still at 50% disc to RNAV). At 0.9x P/BV and 0.3x RNAV, Amara remains substantially undervalued, we believe. MAINTAIN OUTPERFORM."

KS Energy Services rated 'hold' by OCBC

Stock Name: KS Energy
Company Name: KS ENERGY LIMITED

Research House: OCBC

Price Call: HOLD

Target Price: 0.91

OCBC Investment Research in a Nov 11 research report says: "KSE reported a 28.1% y-o-y rise in revenue to $132.4 million and a net loss of $11.5 million in 3Q11. Gross profit margin was lower at 22.7% in 3Q11 compared to 25.7% in both 2Q10 and 3Q10.

"After taking into account distribution costs, administrative and other expenses, the group was in negative territory at the operating level ($5.5 million loss), indicating that 2Q11's operating profit of $146k was but a fleeting moment of positive results after four consecutive quarters of dismal earnings.

"We have adjusted our earnings estimates to account for the bleaker outlook, but given limited earnings visibility, we are still not ready to revert to P/E based valuation for the stock. KSE has been trading at a historical average of 1.25x P/B, and based on 1.15x FY12F NTA, we maintain our fair value estimate of 91 cents. MAINTAIN HOLD."

Mewah International rated 'reduce' by Nomura

Stock Name: Mewah
Company Name: MEWAH INTERNATIONAL INC.

Research House: Nomura

Price Call: SELL

Target Price: 0.50

Nomura Research in a Nov 11 research report says: "Mewah's 3QFY11 performance continued to be weak, with net income of US$6.5 million down 69% y-o-y. The numbers missed our (and Street estimates), with 9MFY11 forming just 50% of our full-year estimate (and 51% of Street).

"The 3Q numbers were only marginally up sequentially (compared to 2Q's US$6 million), suggesting that there is no recovery in the operating environment yet. Mewah has rallied 38% in the last month - which now seems unjustified to us given the continued weak results and possible downside risks to our and Street numbers.

"Valuations at ~8.5x FY12F P/E might look inexpensive, but are misleading given that a downward revision to estimates is increasingly possible, in our view. Unchanged target price of 50 cents. MAINTAIN REDUCE."

Golden Agri-Resources rated 'buy' by Nomura

Stock Name: GoldenAgr
Company Name: GOLDEN AGRI-RESOURCES LTD

Research House: Nomura

Price Call: BUY

Target Price: 0.96

Nomura Research in a Nov 11 research report says: "Earnings increased 99% y-o-y, on the back of revenue doubling y-o-y and adjusted net profit margins remaining flat.

"Revenue growth was driven by a 24% increase in palm product volumes (a function of higher yields and hectarage) and substantial average selling price (ASP) growth (average CPO price up 41% y-o-y).

"The slightly lower operating margins however imply that ASP increase has not outpaced growth in cost per ton (inflated by the rupiah's 5% strengthening y-o-y). Lower interest expense (as a % of revenue) helped adjusted net margins to remain flat.

"We value the company at 16x P/E to FY11F EPS of US$0.05. We believe this mid-cycle valuation of +0.8x SD above the stock's mean is reasonable in the context of our bullish CPO view. Our target price is 96 cents. MAINTAIN BUY."

OCBC cuts UOL target to $5.17; keeps buy

Stock Name: UOL
Company Name: UOL GROUP LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 5.17

OCBC Investment Research has lowered its target price on Singapore property firm UOL Group (UTOS.SI) to $5.17 from $5.48 but maintained its buy rating. 

OCBC said it cut its target price on UOL as it had applied a heavier 25% discount to revised net asset value to reflect the heightened macro-economic risks.

OCBC expected UOL to launch its 577-unit development at Bedok Reservoir in Singapore later this month at indicative price levels of $1,100-$1,200 per square foot. 

But given that Singapore’s CapitaLand (CATL.SI), Southeast Asia’s largest property developer, would likely launch its 583-unit Bedok Residences in the same window at similar price levels, OCBC said it was cautious about UOL’s pace of sales going forward.

However, UOL has a solid track record of accretive land acquisitions and navigating the property cycle well, OCBC said, adding that the management would be actively seeking land as the company’s land bank was almost depleted.

At 11:08 a.m., UOL shares were up 2% at $4.53. The stock has fallen nearly 5% so far this year.

Rotary Engineering rated 'underperform' by CIMB

Stock Name: Rotary
Company Name: ROTARY ENGINEERING LIMITED

Research House: CIMB

Price Call: SELL

Target Price: 0.57

CIMB in a Nov 4 research report says: "At 14% of FY2011, 3Q11 earnings were below our expectation and consensus, due mainly to lower turnover. Turnover fell 25% y-o-y due to slower construction of the SATORP project (seasonality) and delays in the start-up of its UAE project.

"EBITDA of $14.7 million dropped even more by 33% y-o-y, due mainly to net unrealised forex losses of $4.3 million. The positive was steady execution. The group achieved gross margins of 26% vs. 25% for 3Q10 and 21% for 2Q11. YTD,

"Rotary has secured around $170 million of orders vs. our FY2011 order target of $400 million. We now expect $250 million while keeping our FY2012 target of $400 million. Target price of 57 cents now based on 1x CY12 P/BV (previously 7x CY12 P/E) as we look for floor valuations. MAINTAIN UNDERPERFORM."

CH Offshore downgraded to 'hold' by DBS

Stock Name: CH Offshore
Company Name: CH OFFSHORE LTD

Research House: DBS Vickers

Price Call: HOLD

Target Price: 0.57

DBS Vickers Securities in a Nov 8 research report says: "CHO's 1Q12 PATMI of US$6.4 million (-11% y-o-y) was below expectations. Revenue fell 14% y-o-y /7% q-o-q to US$12.3 million on a smaller fleet, as CHO had disposed 3 vessels to its associate in FY2011 to comply with the Indonesian Cabotage Regulations.

"Gross margins also weakened to 53.3% (-2.6ppt y-o-y), mainly on lower revenues against certain fixed overheads, while its SGD-denominated admin expenses rose to US$1.1 million (+41% y-o-y), largely on the back of a weaker USD/SGD, leading to overall earnings weakness. FY2012/2013F cut by 11%/4%.

"Our target price has been correspondingly reduced to 43 cents, still pegged to 9x FY12 PE. Current valuations are not rich (7.4x FY12PE, 0.8x P/BV) and should be supported by relatively attractive and sustainable dividend yield of 7.5% and estimated RNAV of 57 cents. DOWNGRADE TO HOLD."

Eratat Lifestyle rated 'increase exposure' by SIAS

Stock Name: Eratat
Company Name: ERATAT LIFESTYLE LIMITED

Research House: SIAS

Price Call: BUY

Target Price: 0.325

SIAS Research in a Nov 8 research report says: "Eratat 3Q FY11 results were in line with our expectations. Net attributable profit for 9M FY11 came in at RMB138.8 million or 75.7% of our full year forecast. Sales of higher margin apparel products hit RMB193.0 million in 3Q 2011 on 0.96 million pieces sold.

"1H FY12 apparel sales is expected to be 4-5% higher compared to 1H FY11 - excluding any subsequent restocking orders from distributors. In 4Q 2011, Eratat is recognizing revenue from the remaining 54% of its RMB550 million Autumn/Winter order book.

"Eratat's earnings per share for the first nine months of 2011 came up to 6.2 cents. Currently, Eratat trades at just 1.72x its trailing 12M earnings based on a price of 12.5 cents and 474.9 million shares outstanding. Intrinsic value of 32.5 cents. MAINTAIN INCREASE EXPOSURE."

China Fishery Group rated 'buy' by DMG

Stock Name: China Fish
Company Name: CHINA FISHERY GROUP LIMITED

Research House: DMG

Price Call: BUY

Target Price: 1.50

DMG & Partners Research in a Nov 9 research report says: "China Fishery (CFG) announced that they have acquired two Peruvian fishing companies for a total of US$26 million.

"Its share of North Peru TAC will increase by 0.16ppt to 6.21% and share of South Peru's by 0.81ppt to 11.72%, thereby increasing CFG's total TAC for Peru by 4%. Management has revealed that the acquisitions were made at 6.5x EV/EBITDA which we believe is fair compared to CFG which is trading at 7.9x FY10 EV/EBITDA.

"As of June 28, CFG has US$49 million in cash and bank balances which is sufficient for funding the acquisition. We have factored these in our forecasts and raise our FY12 EPS estimates by 1%. Unchanged target price of $1.50. MAINTAIN BUY."

KSH Holdings rated 'buy' by OCBC

Stock Name: KSH Hldg
Company Name: KSH HOLDINGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.30

OCBC Investment Research in a Nov 9 research report says: "KSH Holdings announced 2QFY12 PATMI of $5.2 million, up 24.1% y-o-y. This came in somewhat above our expectations given the faster-than-expected $19.8 million revenue recognition from the property development segment (Lincoln Suites).

"1HFY12 PATMI constituted 59% of our FY2012 forecast. Going forward, we look to construction contract wins and pace of development sales, especially at Cityscape, to be pertinent price drivers. We also expect 2HFY12 earnings to remain buoyant as Cityscape and Boutiq begin construction.

"In addition, of the construction projects, only Watten Residences is slated for completion by early 2012; Mt. Alvernia would start contributing in 3QFY12. We update our assumptions and revise our fair value estimate up to 30 cents from 28 cents previously. MAINTAIN BUY."

Kim Eng downgrades Wilmar to sell, cuts target price

Stock Name: Wilmar
Company Name: WILMAR INTERNATIONAL LIMITED

Research House: Kim Eng

Price Call: SELL

Target Price: 4.50

Kim Eng Securities has downgraded its rating on the world’s largest listed palm oil firm Wilmar International (WLIL.SI) to sell from hold and lowered its target price to $4.50 from $5.31.

Wilmar International (WLIL.SI) missed earnings expectations despite an almost 24% jump in net profit from a year earlier due to a loss from equities investments it made three years ago, foreign exchange losses and weaker margins from its consumer product business.

Kim Eng said that the possible hard landing or slowdown in China’s economy will affect the firm adversely and the brokerage house have tweaked its forecasts for 2011 financial year to reflect the one-off items and lower midstream margins.

As such, Kim Eng has has reduced its forecasts for Wilmar’s 2012-2013 financial year by 25 to 35% respectively. 

At 11:55 a.m., shares of Wilmar were traded 4.5% lower at $5.12, underperforming the 3% fall in the broader Singapore market.

Wilmar’s shares have lost 9% of its value so far this year.

United Envirotech rated 'buy' by OCBC

Stock Name: UtdEnvirotech
Company Name: UNITED ENVIROTECH LTD

Research House: OCBC

Price Call: BUY

Target Price: 0.42

OCBC Investment Research in a Nov 4 research report says: "United Envirotech Ltd (UEL) reported its 2QFY12 results with revenue climbing 9.6% y-o-y to $25.2 million; this largely aided by higher treatment revenue, which grew 54.5%, due to the additions of Hegang 50k m3/day treatment plant and Nansha industrial treatment plant.

"But net profit tumbled 38.7% y-o-y to $3.7 million. On a sequential basis, the group showed a pretty good performance, with revenue rising 21.3% and earnings 4.9%. For 1HFY12, revenue grew 1.4% to $46.0 million, meeting 51.7% of full-year estimate, while net profit fell 29.5% to 7.3 million, or 41.8% of our FY2012 forecast.

"Earnings estimates for both FY2012 and FY 2013 drop by 8.4%. DCF-based fair value also correspondingly drops to 42 cents, upside potential of 30%. MAINTAIN BUY."

Singapore Airlines downgraded to 'hold' by DBS

Stock Name: SIA
Company Name: SINGAPORE AIRLINES LTD

Research House: DBS Vickers

Price Call: HOLD

Target Price: 11.20

DBS Vickers Securities in a Nov 4 research report says: "SIA's 2Q12 EBIT declined 64% y-o-y to $123 million despite a modest 2% increase in revenue to $3.7 billion, as fuel costs rose 29%.

"However, due to higher non-operating income of $53 million versus $18 million a year ago, net profit posted a smaller decline of 49% to $194 million. For 1H12, net profit declined 62% y-o-y to $239 million. An interim dividend of 10 cents was declared (1H11: 20 cents).

"FY2012F and FY2013F earnings are cut by 27% and 17% to $685 million and $893 million respectively on lower yield assumptions. We lower our target P/B valuation multiple for SIA to 1x P/B, against FY2013F ROE of 6.7%. Target price of $11.20. DOWNGRADE TO HOLD."

Mun Siong Engineering rated 'neutral' by DMG

Stock Name: Mun Siong
Company Name: MUN SIONG ENGINEERING LIMITED

Research House: DMG

Price Call: HOLD

Target Price: 0.118

DMG & Partners Research in a Nov 4 research report says: "Mun Siong Engineering's (MSE) 3Q11 earnings was within our expectations (+3.1% y-o-y to $1.9 million), largely due to higher project and maintenance revenue (+16.6% y-o-y).

"With 9M11 earnings making up 73.2% of our FY2011 estimates, we are maintaining our FY2011 and FY2012 earnings forecasts. MSE's focus on growing its maintenance revenue is bearing fruit, with maintenance revenue growth likely to be >50% y-o-y.

"MSE's cash balance of $17.1 million also allows it to do earnings accretive acquisitions and the company has commenced casting its nets for overseas projects in Vietnam and Saudi Arabia. Based on DCF methodology, we derive a new target price of $0.118, down from $0.165 previously. MAINTAIN NEUTRAL."

Sembcorp Marine rated 'buy' by Kim Eng

Stock Name: SembMar
Company Name: SEMBCORP MARINE LTD

Research House: Kim Eng

Price Call: BUY

Target Price: 4.95

Kim Eng Research in a Nov 4 research report says: "Sembcorp Marine (SMM) posted 3Q11 net profit $222.5 million, down 25% versus a bumper 3Q10. This is in line with expectations. While 3Q11 revenue grew by 16.8% y-o-y to $1,302.3 million, the divergence was due to the difference in revenue recognition on a specific project.

"There were no major surprises with the group delivering exactly as expected. SMM has secured US$2.6 billion worth of contracts YTD with most being jackup orders. Net orderbook stands at around US$4.2 billion, with deliveries up to 2014.

"Our forecasts are only being adjusted for the $54.4 million tax refund due to the favourable tax assessment from the disputed foreign exchange transactions losses in FY2009 and FY2010. SOTP-based target price of $4.95, with the core shipyard operations valued at just 13x FY12F earnings. MAINTAIN BUY."

CSC Holdings rated 'neutral' by DMG

Stock Name: CSC
Company Name: CSC HOLDINGS LTD

Research House: DMG

Price Call: HOLD

Target Price: 0.11

DMG & Partners Research in a Nov 4 research report says: "CSC's 2QFY12 earnings were above expectations due to a one-off profit contribution (before taxes) of ~$3.7 million arising from the development of an industrial property.

"Stripping away the one-off earnings, pre-tax core construction earnings would be ~$1.7 million, down 67.3% y-o-y despite a 21.6% y-o-y jump in core construction revenue. While order book is strong, standing at $220 million currently (+10% from last quarter), margins may only pick up in 2HFY12 due to intense competition.

"We have raised our FY2012 earnings forecast by 34.5% to $7.1 million, to reflect the recognition of the industrial property development earnings. Lower target price of 11 cents (previously 12 cents), based on 0.8x P/B (previously 0.85x). MAINTAIN NEUTRAL."

OCBC cuts ST Engineering target to $3.01

Stock Name: ST Engg
Company Name: SINGAPORE TECH ENGINEERING LTD

Research House: OCBC

Price Call: BUY

Target Price: 3.01

OCBC Investment Research has lowered its target price on Singapore Technologies Engineering (STEG.SI) to $3.01 from $3.37, but maintained its buy rating.

ST Engineering, Singapore’s largest defence contractor and one of the world’s largest aircraft maintenance firms, is also involved in electronics, land systems and marine.

OCBC said ST Engineering management had lowered its guidance for 2011 revenue and pre-tax profit to be comparable to 2010, versus higher revenue and pre-tax profit previously.

The company warned of uncertainties arising from the sovereign debt issue in Europe, the slowing American economy as well as the unrest in the Middle East and North Africa, OCBC noted.

The bank lowered its estimates for ST Engineering’s 2011 revenue and profit after tax and minority interests by 2.4% and 1.3%, respectively, to $6.05 billion and $503.2 million.

ST Engineering reported on Friday a 3% increase in its third-quarter net profit to $133.8 million from a year earlier, partly due to a writeback.

At 9:02 a.m., the stock was flat at $2.85.

Phillip cuts Singapore Air target to $11.35

Stock Name: SIA
Company Name: SINGAPORE AIRLINES LTD

Research House: Phillip Securities

Price Call: HOLD

Target Price: 11.35

Phillip Securities maintained its hold rating on Singapore Airlines (SIAL.SI), the world’s second largest carrier by market value, but cut the target price to $11.35 from $13.45.

SIA reported last Thursday a 49% fall in second quarter net profit to $194 million, within Phillip’s expectations, due to higher fuel prices and a decline in passenger yields.

The fall in earnings would have been worse but for a one-off “return of capital” gain of S$48 million from the redemption of preference shares by associate Virgin Atlantic.

“With weakening consumer confidence in major economies, discretionary travel would likely be scaled back. Declines in consumer confidence tend to lead a fall in passenger yields and with the worsening economic outlook, we believe that further declines are likely,” Phillip said.

The brokerage also said that SIA is currently trading at 1.04 times of its financial year 2012 book value, and the price will not increase in the near term unless oil prices fall or the economic environment turns positive.

At 9:51 a.m., shares of SIA were unchanged at $11.28. The shares have fallen about 26% since the start of the year.

OCBC downgrades Rotary Engineering to hold

Stock Name: Rotary
Company Name: ROTARY ENGINEERING LIMITED

Research House: OCBC

Price Call: HOLD

Target Price: 0.61

OCBC Investment Research lowered Singapore’s Rotary Engineering (ROTE.SI), a construction firm that specialises in energy projects, to hold from buy and cut its target price to $0.61 from $0.66.

Rotary Engineering reported on Thursday a 30% fall in profit to $7.2 million, below OCBC’s expectations, due to lower contribution from its Middle East business which accounts for more than half of the group’s revenue.

“Rotary’s operating environment continues to be clouded by the uncertainty in the global financial markets and the slowdown in the U.S. and European economies. We see increased likelihood of oil companies pushing back their larger infrastructure investments,” OCBC said in a report.

The brokerage also said it expects Rotary to face margin pressure from its competitors in the near term, but noted that the company has a strong balance sheet and a healthy order book of $758 million.

At 11:11 a.m., shares of Rotary were up 2.4% at $0.63. The shares have fallen about 38% since the start of the year.

JPMorgan cuts Hyflux target to $1.60

Stock Name: Hyflux
Company Name: HYFLUX LTD

Research House: JP Morgan Chase

Price Call: HOLD

Target Price: 1.60

JPMorgan has lowered its target price on Singapore water treatment firm Hyflux (HYFL.SI) to $1.60 from $1.70 and maintained its neutral rating.

Hyflux said on Thursday its third-quarter net profit fell 34% to $12.6 million  from a year earlier, hurt by lower contributions from the Middle East and North Africa. 

JPMorgan trimmed its 2011 earnings estimate by 20% to account for lower earnings contribution from Hyflux’s Tuas desalination plant in Singapore, slower construction pace in China, as well as higher staff and finance costs.

Hyflux management had highlighted that based on the current macroeconomic environment, it does not expect to make major new investments over the next 1-2 years, which will require it to commit significant additional capital, JPMorgan added.

At 11:22 a.m., Hyflux shares were up 0.7% at $1.415.

United Overseas Bank rated 'neutral' by Nomura

Stock Name: UOB
Company Name: UNITED OVERSEAS BANK LTD

Research House: Nomura

Price Call: HOLD

Target Price: 21.90

Nomura Research in a Nov 2 research report says: "UOB declared 3Q earnings of $522 million (-18% q-o-q), 5-10% below Nomura and consensus expectations on an annualised basis.

"Key P&L drags were at the operating income level (-5% q-o-q, compared to +7% q-o-q for DBS) on (i) flat net interest income q-o-q despite +7% q-o-q loan growth as NIM contracted 3bps q-o-q; and (ii) 15% q-o-q contraction in non-interest income.

"Other P&L line items were within expectations but underlying ratios were less impressive-ie, cost-income ratio jumped to 46% while loan loss reserve fell to 133% as absolute NPLs inched up.

"Core equity ratio was a sector-leading 12.3%. Our Gordon growth based price target is 21.90 or 1.7x FY11F adjusted book value,13x FY11F earnings. NEUTRAL."

Oversea-Chinese Banking Corp rated 'hold' by Phillip Securities

Stock Name: OCBC Bk
Company Name: OVERSEA-CHINESE BANKING CORP

Research House: Phillip Securities

Price Call: HOLD

Target Price: 7.30

Phillip Securities Research in a Nov 4 research report says: "9MFY11 net profit of $1.72 billion and revenue of $4.1 billion met 69% and 70% of our full year forecasts respectively, including divestment gains of $39 million from sale of Bassein road in prior quarters.

"Results were below our expectations mainly due to trading losses and negative impact on GE's investment portfolios. OCBC core businesses were more resilient than its peers but having missed estimates, we had to revise our forecast to match reality.

"Earnings estimates were reduced by 8% for FY2011 and 13% in FY2012. Fair valuation is revised to $7.30 representing 1.2x PB based on estimated NBV of $6.08. MAINTAIN HOLD."

Hyflux rated 'neutral' by Nomura

Stock Name: Hyflux
Company Name: HYFLUX LTD

Research House: Nomura

Price Call: HOLD

Target Price: 2.33

Nomura Research in a Nov 3 research report says: "3Q11 earnings came in at $12.6 million, down 34% y-o-y. Excluding one-offs, 3Q11 recurring earnings came in at a loss of $1 million.

"Recurring 9M11 earnings came in at $23.0 million, down 65% y-o-y, contributing 23% and 29% of our/consensus' FY2011F estimates, respectively. Net gearings (net debt to equity) came in at 14% as at 9M11 (vs. 75% as at FY10), due to the issue of $400 million perpetual preference shares earlier in the year.

"Management expects gearings to go up to fund the development of Tuaspring project. Dividends of $12 million were declared and paid to the preference shares holders on Oct 25. Target price remains at $2.33. MAINTAIN NEUTRAL."

Broadway Industrial Group rated 'hold' by DBS

Stock Name: Broadway
Company Name: BROADWAY INDUSTRIAL GROUP LTD

Research House: DBS Vickers

Price Call: HOLD

Target Price: 0.32

DBS Vickers Securities in a Nov 3 research report says: "BWAY recorded 3Q11 net loss of $9.9 million as a result of forex losses of $13.2 million, of which $16.5 million are unrealized MTM losses from hedging of USD/CNY and USD/SGD.

"Excluding forex losses, operating profit would be $3.3 million, which is below our $4 million estimate due to higher operating costs in China, weaker than expected non-HDD business (operating loss of S$1.1m) and start up expenses.

"But BWAY looks like it could gain market share from Thailand floods... For a start, it has extra capacity in Wuxi to capture all customers' requirements before its Thailand plant resumes in March 2012. The current situation is still volatile and it remains to be seen if the spillover would flow to BWAY. Target price lowered slightly to 32 cents based on 0.6x PB. MAINTAIN HOLD."

Parkway Life Reit rated 'hold' by Phillip Securities

Stock Name: PLife REIT
Company Name: PARKWAYLIFE REIT

Research House: Phillip Securities

Price Call: HOLD

Target Price: 1.91

Phillip Securities Research in a Nov 3 research report says: "PLife REIT posted revenue of $22.0 million (+3.1% q-o-q, +4.1% y-o-y), net property income (NPI) of $20.1 million (+2.7% q-o-q, +3.6% y-o-y), distributable income of $14.5 million (+1.6% q-o-q, +6.8% y-o-y).

"DPU for the quarter was 2.40 cents (+1.3% q-o-q, +6.7% y-o-y). DPU for 9M11 was within our expectations, constituting 75.4% of our full year estimates and 73.5% of consensus estimates. The enhancement works at Sawayaka Nokatakan has completed and brings along an improvement of 1.43% increase in fixed gross rent of Nokatakan with a low capital outlay of $0.15 million.

"We raised FY11 DPU by 1% to 9.55 cents to account for the interest cost savings from the recent extension of interest rate hedges. Despite the adjustment of FY11 DPU, our target price remains unchanged at $1.91. MAINTAIN HOLD."

Starhub rated 'outperform' by CIMB

Stock Name: StarHub
Company Name: STARHUB LTD

Research House: CIMB

Price Call: BUY

Target Price: 3.08

CIMB in a Nov 1 research report says: "StarHub should not be too affected by the iPhone launch, thanks to more rational subsidies so far though the degenerating economics of pay TV is a concern. NBN take-up is slow and this should blunt competition in the residential market where StarHub is dominant.

"While 4Q margins could be affected, this should only be a blip. Industry rationality is probably inspired by a rather saturated smartphone market where 65-70% of postpaid users now possess smartphones and any ARPU uplift is unlikely to be material.

"We keep our earnings forecasts but roll over our target price to end-2012, which lifts our DCF-based target price of $3.08 (WACC 8.6%). Catalysts expected from slower competition in NBN, stabilising margins and a stable dividend outlook. MAINTAIN OUTPERFORM."

Osim International rated 'buy' by OCBC

Stock Name: OSIM
Company Name: OSIM INTERNATIONAL LTD

Research House: OCBC

Price Call: BUY

Target Price: 1.37

OCBC Investment Research in Nov 2 research report says: "OSIM reported its 3Q11 which fell short of our below consensus estimates. Revenue grew 5.9% y-o-y but declined 10.8% q-o-q to $123.6 million; while net profit rose 0.8% y-o-y but dipped 30.1% q-o-q to $13.1 million.

"Excluding a one-off tax provision of $2.8 million, we estimate that OSIM's net profit still came in below our forecasts by ~10.4%. For 9M11, revenue and net profit growth of 9.3% and 56.9% met 71.0% and 69.6% of our FY2011 estimates, respectively.

"We cut our FY2011/FY2012 revenue and net profit forecasts by 5.7%/7.2% and 7.1%/2.7%, respectively. Fair value estimate decreases from $1.52 to $1.37, potential upside of 15.1%. MAINTAIN BUY."

Swing Media Technology Group rated 'buy' by DMG

Stock Name: Swing Media
Company Name: SWING MEDIA TECHNOLOGY GRP LTD

Research House: DMG

Price Call: BUY

Target Price: 0.23

DMG & Partners Securities in a Nov 2 research report says: "Swing Media announced that it had formally entered into contract with PetroChina in carrying out turn-key solar panels installations for 100 of its petrol stations.

"Commencing from 2H FY12, this will contribute positively to the group's FY2012 and FY2013 earnings. The upcoming $9.3 million placement will provide Swing Media with the necessary working capital for the project, allowing it to tap on the booming Chinese solar market.

"Given (1) falling solar-panel prices and (2) increasing domestic demand, we believe the new business will provide a kicker to its earnings. Unchanged target price of 23 cents based on 0.5x industry average P/B. BUY"

UE E& C upgraded to 'buy' by OCBC

Stock Name: UE E&C
Company Name: UE E&C LTD.

Research House: OCBC

Price Call: BUY

Target Price: 0.65

OCBC Investment Research in a Nov 2 research report says: "UE E&C announced last night that its 90%-owned subsidiary, United Engineers (B) Sdn Bhd, has secured a BND131.5 million ($131.5 million) contract from Brunei government to construct the Prime Minister Office Building Complex.

"UE E&C has also won the tender for Pasir Ris EC site for $122.2 million. The group should be able to finance both projects without difficulty as it has a strong net cash position of $108 million (as of end-Jun 2011) and low capex requirements (FY12: est. $13 million).

"We have revised our FY2012 revenue/earning estimates by about 15-20% upwards. Applying a higher valuation peg of 4x (from 3x previously) on FY12s EPS to account for the improved earnings visibility, we obtained a revised fair value of 65 cents (previously 41 cents). UPGRADE TO BUY. "

STX OSV Holdings rated 'outperform' by CIMB

Stock Name: STXOSV
Company Name: STX OSV HOLDINGS LIMITED

Research House: CIMB

Price Call: BUY

Target Price: 1.39

CIMB in a Nov 2 research report says: "Fears over the impact of tighter credit on STX OSV's order intake are valid, although we believe STX OSV's current order book is intact and cancellations risks are low.

"STX OSV is not directly dependent on funding from export. Rather, a handful of its clients rely on export to finance their vessel purchases. We believe STX OSV's order book of NOK14.2 billion is intact. We are comforted by STX OSV's track record of no order cancellations in the past 10 years.

"Target price of $1.39, based on 9x CY13 P/E. MAINTAIN OUTPERFORM."

Nomura ups Biosensors target to $1.70

Stock Name: Biosensors
Company Name: BIOSENSORS INT'L GROUP, LTD.

Research House: Nomura

Price Call: BUY

Target Price: 1.70

Nomura has raised its target price for Singapore-listed medical technology firm Biosensors International Group (BIOS.SI) to $1.70 from $1.65 and kept its buy rating.

Nomura has raised its earnings estimates for Biosensors in fiscal 2012-2014 by 2-5%, after it reported second quarter earnings that were ahead of the brokerage’s expectations.
Biosensors said on Wednesday its second quarter net profit more than doubled to $22.9 million, up from $8.5 million a year ago.

The brokerage also noted that Biosensors’ management has raised its guidance for sales to grow by 70-80% in fiscal 2012, up from 50-60% previously.

At 12:46 p.m., shares of Biosensors fell 1.1% to $1.40. The shares have risen about 24% since the start of the year.

OCBC lowers Osim target price

Stock Name: OSIM
Company Name: OSIM INTERNATIONAL LTD

Research House: OCBC

Price Call: BUY

Target Price: 1.37

OCBC Investment Research lowered Singapore’s massage chair maker Osim International (OSIL.SI) target price to $1.37 from $1.52 but maintained its buy outlook.

OCBC said it has lowered its net profit forecast for Osim  in 2011 to 2012 from 7.1% to 2.7% respectively.

The brokerage said that Osim International third quarter net profit of $13.1 million was 10.4% lower than its estimate.

Osim faces a risk of lower sales growth as the euro zone crisis and sluggish U.S growth weigh on consuming spending in Asia.

As such, the brokerage also lowered its earings per share outlook for 2012 to 15 times from 12.9 times.    

At 10:00 a.m., shares of Osim were 0.02% lower at $1.18. They have fallen 28% since the start of the year.

 

CIMB upgrades DBS to outperform; target $14

Stock Name: DBS
Company Name: DBS GROUP HOLDINGS LTD

Research House: CIMB

Price Call: BUY

Target Price: 14.00

CIMB Research has upgraded Singapore’s DBS Group (DBSM.SI), Southeast Asia’s largest bank, to outperform from underperform and raised its target price to $14.00 from $11.90.

CIMB said DBS’s third-quarter net profit was above its expectation and consensus forecast on the back of treasury gains and trade fees.

This may be attributed to DBS’s initiatives to build its global trade services offerings to clients, CIMB said, adding that it may also reflect the trend of French banks pulling out of trade finance in Asia.

Loans had another strong quarter, but margins suffered as securities yields fell while deposit costs in Hong Kong rose, CIMB said. But this reflects the competition for local deposits across the world, it noted.

Key concerns are rising costs, as well as liquidity and potential non-performing loans from China, CIMB said. At 10:22 a.m., DBS shares were up 0.6% at $12.05.

DBS said on Wednesday it can ride out near-term economic uncertainties after posting a better-than-expected 6% rise in quarterly profit.

OCBC upgrades UE E&C to buy

Stock Name: UE E&C
Company Name: UE E&C LTD.

Research House: OCBC

Price Call: BUY

Target Price: 0.64

OCBC Investment Research upgraded Singapore-listed construction and engineering firm UE E&C Ltd (UECL.SI) to buy from hold and raised its target price to $0.65 from $0.41.

OCBC said it has raised its 2012 estimates for UE E&C’s revenues and earnings by 15-20% to account for two recent contract wins worth about $254 million in total.

UE E&C should be able to finance both projects without difficulty as it has a strong net cash of $108 million and low expenditure requirements.

The brokerage also said that it increased its valuation peg of the stock to four times its 2012 earnings per share from three times due to improved visibility of its income. 

At 9:10 a.m., UE E&C shares were untraded. The share last transacted at $0.38 on Oct 28.