SG: MARKET PULSE: Starhill, Tiger, Midas (12 Jun 2013)

Stock Name: Starhill Gbl
Company Name: STARHILL GLOBAL REIT

Research House: OCBC

Price Call: BUY

Target Price: 1.00

Stock Name: TigerAir
Company Name: TIGER AIRWAYS HOLDINGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.79

Stock Name: MIDAS
Company Name: MIDAS HLDGS LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 0.54

MARKET PULSE: Starhill, Tiger, Midas

12 Jun 2013

KEY IDEA Starhill Global REIT: Another positive development Summary: Starhill Global REIT (SGREIT) announced that the rent review for the Toshin master lease has been concluded, and that a renewal rent at 6.7% higher than the prevailing rate has been secured. This is consistent with our 29 Apr report that SGREIT may again benefit from rental upside following the completion of the review process. We now factor in the increased rents in our forecasts but lower our fair value marginally to S$1.00 on higher risk-free rate (S$1.05 previously). However, we continue to like SGREIT for its growth potential, strong financial position and compelling valuations. For FY13, SGREIT looks set to gain from continued strength from its Singapore portfolio, incremental income from its newly-acquired Plaza Arcade and a 7.2% rental escalation from its Malaysia master leases in Jun. We maintain BUY on SGREIT. Key risks include weaker JPY/AUD and negative impact from a potential CPU conversion. (Kevin Tan) MORE REPORTS Tiger Airways: Time for a tiger Summary: In light of its more than 6% price correction, we are reiterating our BUY rating on Tiger Airways (TGR) with an unchanged fair value estimate of S$0.79 as we believe prospects remain positive for the counter. Its recent May operating statistics revealed its eighth consecutive month of passenger traffic growth for TGR SG, and passenger load factors during the period have also remained fairly resilient, which demonstrates its effective capacity management. In addition, we are hopeful for a better showing from its associate airlines given the propensity for travel in the coming months for Indonesia and the Philippines. On a broader scale, the industry dynamics, namely growth in the Asia-Pacific region, remains conducive for budget carriers as consumers become more affluent and appetite for air travel increases. (Lim Siyi)

Midas Holdings: JV NPRT secures CNY1.26b metro contract Summary: Midas Holdings (Midas) announced that its 32.5%-owned JV Nanjing SR Puzhen Rail Transport (NPRT) has clinched a CNY1.26b metro contract. This is for the supply of 33 train sets (or 198 train cars) for the Shenzhen Metro Line 3 project. However, delivery is scheduled only from 2015 to 2016. Given that this is the third contract secured by NPRT in two weeks, we believe this highlights the growing momentum of China's metro industry. In our view, this may also lead to future contract wins for Midas given that it is a supplier of aluminium extrusion profiles for NPRT. Maintain BUY on Midas, with an unchanged fair value estimate of S$0.54, pegged at 1.1x FY13F P/B. (Wong Teck Ching Andy) For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES - US stocks fell, sending the S&P 500 Index lower for a second day, after Bank of Japan Governor Haruhiko Kuroda said he sees no need to expand monetary stimulus immediately. - DBS would still want to buy Temasek's entire stake in Danamon, Business Times reports, citing an interview with Peter Seah, chairman of DBS Group Holdings Ltd. - Aussino expects that it will not be able to exit the SGX watch list by the 3 Sep deadline and intends to apply to SGX for extension of time to apply for removal from watch list. - T T J Holdings wins new contracts for structural steelworks and civil defence shelter doors in Singapore and Malaysia, bringing its order book to S$164m as at 11 Jun. - Tsit Wing's Chairman and CEO Peter Wong seeks to privatize the company and has acquired an aggregate of 20m ordinary shares at a price of $0.3075 each, valuing it at S$65.5m - Del Monte Pacific says shareholder Nutriasia Pacific to enter a placement agreement for the sale of 150m shares of the Company which will be listed and traded on the PSE, marking first dual listing between the SGX and the PSE.