02 May 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 :It takes a long time to grow an old friend.
- JOHN LEONARD
Singapore: The Day Ahead
SINGAPORE DAYBOOK:S'pore must continue to be attractive to investors: PM Lee. It is critical that it retains reputation for reliability and, openness, he says [SINGAPORE] Investments are still critical to transform Singapore's economy and to upgrade workers, Prime Minister Lee Hsien Loong said at the annual May Day Rally yesterday.
What's different now, however, is that the country is seeking higher-skilled and higher value-added activities that are less manpower-intensive or land-intensive.
He was addressing some 1,600 people at Downtown East in Pasir Ris, including cabinet ministers, union leaders, workers and employers.
Speaking for an hour in both English and Mandarin, Mr Lee said it is important that Singapore retains its reputation as an attractive place to do business.
MARKET SCOOP
Virgin, Tiger to push back deal deadline
KepCorp regroups two infrastructure units into one new entity
Investments crucial to transform economy: PM Lee
Yoma extends deadline on development of Myanmar site
DBS VICKERS SECURITIES says... CDL HOSPITALITY TRUSTS | HOLD | TP: S$2.07
Given the seasonally slower start to 2013, CDL Hospitality Trusts'(CDREIT) gross revenue and NPI declined marginally by 1% and 2% y-o-y to S$37.9m and S$35.8m respectively
Income available for distribution (before retained income) dipped 3% y-o-y to S$ 28.7m, while DPU of 2.59 Scts was 3% lower y-o-y after a 10% retention ratio
CDREIT's Singapore portfolio RevPAR was 7.9% lower y-o-y at S$191/night (occupancy rate of 87%, average daily rate of S$219/night)
However, its overseas acquisitions performed well, especially the recently acquired Angsana Velavaru, which outperformed with a 28.5% y-o-y hike in RevPAR to US474/night
However, given new incoming hotel supply in 2013 (4,138 rooms, +8% of current supply), we believe that further room rate hikes will be limited. We now assume that rates will remain flat y-o-y in FY13 (+3% previously)
Given little upside to RevPAR in the immediate term, we do not see any re-rating catalysts
But, downside to share price is limited with CDREIT trading at yields of close to 6%
DMG OSK says...
FRASERS COMMERCIAL TRUST | BUY | TP: S$1.65
FCOT reported 2QFY13 DPU of 1.99 cents (+14% y-o-y)
Together with its 1QFY13 DPU of 1.58 cents, 1HFY13 DPU accounts for 43.4% of our full year forecast
The higher dividend per unit (DPU) was mainly attributed to the redemption of convertible perpetual preferred units (CPPU) which was costing FCOT an average 5.5% annually at the DPU level
Its management indicated that the pre-commitment rate in China Square Central reached a stable 92.6% from the actual occupancy of 73%
With the pro-active management of its properties, the occupancy rate of FCOT's portfolio has hit a high of 95.3% (Singapore properties - 93.1%, Australia properties - 99.5%)
Going forward, we expect FCOT to continue to register stronger DPU as the trust: i) reaps the full year benefit from the acquisition of another 50% of interest in Caroline Chisholm Centre and ii) benefits from CPPU buyback
Given its bright prospects and strong portfolio, we favour FCOT for its attractiveness and maintain our BUY rating on this counter with a higher DDM based (COE: 7.1%; TGR: 2.0%) TP of SGD1.65
UOB KAY HIAN says...
BUMITAMA AGRI | BUY | TP: S$1.12
Bumitama Agri (BAL) announced its 1Q13 production data with CPO production growth of 30.9% yoy to 116,971 tonnes (-21.3% qoq)
1Q13 production was within our expectation and is current the best among the Indonesia based companies, which had announced production in Indonesia
Strong production growth in 1Q driven by its young age profile and about 10,000ha of newly mature areas that came on-stream in 1Q13
BAL is scheduled to announce its 1Q13 results on 13 May 2013 after market close
We are expecting the net profit of Rp150b-Rp170b for 1Q13 (18-20% of full year estimated net profit)
Maintain BUY with target price of S$1.12, based on 14x 2014F PE
We like BAL for its young age profile and best oil extraction rate to support its 5-year net profit CAGR of 32%
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