08 April 2013~ Good Morning Singapore!
Central Execution Team - The Excellence of Execution
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Global Flash: While You Were Sleeping
Source: Marketwatch
Quote for the day :Success is a lousy teacher. It seduces smart people into thinking they can't lose.
- BILL GATES
Singapore: The Day Ahead
SINGAPORE DAYBOOK:Park Hotel Grp seen seeking $1b for Orchard Rd hotel. Total price tag pegs hotel's value in the high-$1m range per room. [SINGAPORE] Park Hotel Group, which announced a $300 million or $893,000 per room sale of its Park Hotel Clarke Quay to Ascendas Hospitality Trust over the weekend, is understood to have put some of its other hotels on the market as well.
Industry players say these include its two remaining Singapore hotels - Grand Park City Hall in Coleman Street and Grand Park Orchard (along with its retail podium Knightsbridge).
The group is said to be seeking more than $1 billion for the latter asset or a whopping sum in the high-$1 million range per room - which if achieved would reprice the Singapore hotel market, according to industry players.
The asset comprises the 308-room Grand Park Orchard and about 74,000 sq ft net lettable area of retail space - leased to retailers such as Abercrombie & Fitch, Topshop/Topman, Brooks Brothers, Tommy Hilfiger, Dickson Watch & Jewellery, and The Hour Glass.
MARKET SCOOP
Interra to drill new well in Myanmar
Singapore's Temasek launches new firm for LNG investments
MCT issues S$70 million fixed rate notes
Govt closes car loan loopholes
Olamwithdraws lawsuit against Muddy Waters and its founder
Fu Yu seeks trading halt on SGX's query on price, volume surge
DBS VICKERS Securities says...
PAN-UNITED CORPORATION | BUY | TP: S$1.16
We believe the port business is currently undervalued
Our current valuation of CXP port stands at 7x FY13F earnings vs peer average of China listed ports at 12.2x
We believe placing 12.2x earnings multiple on the port business is fair to our valuation of PAN as it reflects a more representative value to assets that the company holds
Our analysis into the MRT construction projects suggests that we may see concurrent construction for five MRT lines at various stages in 2015
We expect PAN to re-rate to +2SD of its mean valuation ahead of the construction peak in 2015.
We conservatively re-peg CXP's value in PAN's SOTP valuation from 7x PE to 12x, in line with China-listed ports
We raise PAN's TP to S$1.16, implying 13.9x FY13F PE, which is slightly above +1SD but below +2SD of its mean valuation
STANDARD CHARTERED Securities says...
SINGAPORE PRESS HOLDINGS | OUTPERFORM | TP: S$4.99
SPH announced an agreement to acquire all the issued shares of Sgcarmart, a vehicle classifieds site and car auction platform
We welcome the deal as it provides synergies to SPH‟s online classifieds business
The deal, which involves acquisition of the entire issued capital, will be fully financed by cash
SPH already owns the online car portal, STCars, in addition to STJobs, STProperty and STClassfieds
In our view, the Sgcarmart acquisition will tighten SPH‟s grip on the online classifieds market
The proposed REIT listing would strengthen SPH‟s dividend stream and also enhance its value
Its 6.0% (2013E) yield is the highest among classic Singapore yield plays, and is above the peer group average of 37%
OCBC Securities says...
CAPITAMALL TRUST | BUY | TP: S$2.32
CapitaMall Trust (CMT) has been a clear laggard within the S-REITs space, staying flat YTD versus an average of 11.0% increase in unit prices for its local retail peers (FTSE ST REIT Index: 7.2% YTD)
We believe this is unjustified given its portfolio of 15 quality retail malls, which are strategically located in the suburban areas and downtown core of Singapore, and its relentless efforts in optimizing its yield via asset enhancement initiatives (AEIs)
According to CBRE, the average rents in prime Orchard Road rose for the first time (up 2% QoQ) in 1Q13 after staying flat since 3Q11
While the suburban retail will see a substantial amount of space (~1.6m sqft) coming online in 2013, CBRE notes that retailers are still upbeat about the suburban market (1Q13 rents flat QoQ)
This is consistent with our view that both Orchard Road and suburban rents may possibly remain firm in 2013
We are keeping our S$2.32 fair value unchanged and maintaining BUY on CMT as we expect the valuation gap to narrow between CMT and its peers
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