OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: Armstrong
Company Name: ARMSTRONG INDUSTRIAL CORP LTD

Research House: CIMB

Price Call: SELL

Target Price: 0.29

Stock Name: Genting HK US$
Company Name: GENTING HONG KONG LIMITED

Research House: UOB KayHian

Price Call: SELL

Target Price: 0.35

Market Compass

25 March 2013~ Good Morning Singapore!

Singapore Idea Snippets:

25 March 2013~ Good Morning Singapore! Central Execution Team - The excellence of execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : If a free society cannot help the many who are poor, it cannot save the few who are rich - JOHN F. KENNEDY Singapore: The Day Ahead SINGAPORE DAYBOOK: M&L goes on buying spree despite recent divestment. Acquisition of 3 properties brings its portfolio value to $1.4 billion. [SINGAPORE] M&L Hospitality Trust (M&L) is not in a divesting mood, having in fact acquired three properties since it suspended its initial public offering (IPO) last year, its new chief executive has said. Neil Maxwell, who took over the reins at the real estate investment trust (Reit) last month, told The Business Times that of the three, one is the 165-room Hilton Auckland in New Zealand; the other two, with a combined 350 rooms, are the Holiday Inn and Staybridge Suites in Stratford, London. Financial details were not disclosed. Mr Maxwell was speaking to BT after the trust had disposed of the Ibis Novena hotel - what he described as one of M&L's smaller assets - to Keppel Land for $150 million. MARKET SCOOP Yoma sets up new Myanmar-based JV Singapore's bond market takes a breather Banks are feeling the pinch of regulatory action OCBC shifts strategy to focus on the customer Cyprus in last ditch EU talks to save economy CIMB Securities says... ARMSTRONG INDUSTRIAL | UNDERPERFORM | TP: S$0.29 We believe Armstrong's post-FY12 results share price outperformance has priced in all the positives from its automotive segment and cost saving measures In addition, our channel checks reveal an unexciting outlook for the HDD industry in 1H13 Data storage sales from Armstrong are expected to bottom out in 2Q13; hence a better 2H13 is expected In the long term, our data checks suggest flat growth for HDD all the way to 2017 Jan-Feb's inventory data for Chinese automakers was positive, and we expect Armstrong's automotive segment to benefit accordingly Our target price stays at S$0.29, pegged at 8x CY14 P/E, its 5-year average UOB KAY HIAN says... GENTING HONG KONG | SELL | TP: US$0.35 Genting Hong Kong chalked up a net profit of US$183.3m from continuing operations in 2012 (+4.6% yoy on restated 2011 results) Better-than-expected results were seen at both Star Asia and Resorts World Manila (RWM), while we had already factored in the impressive results of NCL after its result announcement in Feb 13 Although commendably closing on a high note, GENHK's earnings have been inexplicably erratic this year, in part, due to RWM's exceptionally low margins in 1H12 and a strong recovery in 2H12 we continue to expect RWM's earnings to be impacted by the opening of Manila's second integrated resort and casino, Solaire Manila, last Saturday We continue to brace for a modest fall in RWM's gross gaming revenue this year, particularly in the 2H, and further slippage in 2014 Our caution on the stock has been premised on concerns over a) intensifying competition and a longish consolidation at the integrated resort and casino space for RWM, b) lofty valuations of NCL since its listing DBS VICKERS Securities says... KREUZ HOLDINGS | BUY | TP: S$0.58 Kreuz's earnings delivery has consistently exceeded our expectations as they have continued to secure additional work at higher margins from customers, based on their execution track record For FY12, Kreuz registered net profit of US$39.7m (up 49% y-o-y), and gross margin increased to 32.9% (FY11: 30.7%) as the group reduced reliance on third party vessel chartering, with a new vessel acquisition earlier in FY12 In the longer term, it is building a state-of-the-art multi-purpose support vessel capable of operating in deeper waters The group won US$155m worth of orders in FY12, and current order book stands at US$205m, of which about 90% will be recognised in FY13 With better-than-expected margins and robust order win outlook, we revise up our FY13/14F earnings by about 19-20% Current valuation is undemanding, given its earnings delivery track record to date, healthy growth prospects and strong FY13F ROE of close to 25% Maintain BUY with a higher TP of S$0.58, pegged to 6x FY13 earnings