29 Aug 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 :The only time a woman really succeeds in changing a man is when he is a baby.
- NATALIE WOOD
Singapore: The Day Ahead
SINGAPORE DAYBOOK : F&N: Weighing square feet and fluid ounces. Demerger appears to be a 'price discovery exercise', says analyst
[SINGAPORE] Fraser and Neave's (F&N) split-up will test whether the company's diverse businesses had actually been weighed down by a conglomerate discount.
"F&N's planned demerger and listing of two separate entities appear to be a price discovery exercise for now," CIMB analyst Donald Chua wrote in a report.
F&N on Tuesday said it plans to distribute two shares of its property business, Frasers Centrepoint Ltd (FCL), for every one F&N share held.
FCL will then be listed by way of introduction, with no plans to raise additional capital during the listing. (Source: The Business Times)
MARKET SCOOP
PM makes changes to cabinet and other appointments
IDA launches public consultation on proposed acquisition of OpenNet
Metech reverses loss position
Dukang's Q4 earnings jump on higher sales
Olam gets US$120m IFC loan for Nigerian, Indian projects
Sembcorp to build 2 water treatment plants in Liaoning
(Source: The Business Times) DBS Securities says... IHH HEALTHCARE | HOLD | TP: S$1.50
2Q13 headline revenue and net profit dropped by 38% and 61% y-o-y to RM1.68bn and RM157m respectively
The drop was due to the recognition of medical suite sales from Novena hospital in 2Q12, which contributed RM1.2bn and RM193.6m in revenue and net profit, respectively
In addition, 2Q12 profits were boosted by exceptional items, including fair value gains on investment properties
In fact, 2Q13 core net profit (excl. exceptional items and medical suite sales in 2Q12) at RM189m was 60% higher than a year earlier
EBITDA margins (excl PREIT) strengthened marginally by 1.7ppts to 22.5% (2Q12: 20.8%) despite cost pressures
This came on the back of improving revenue intensity and positive EBITDA contribution from Novena Hospital and Acibadem Ankara Hospital
In addition, Acibadem Bodrum Hospital also saw a smaller EBITDA loss in 2Q13
Novena Hospital posted a turnaround in EBITDA contribution, with positive RM2m EBITDA
This is in line with earlier expectations for Novena Hospital to turn EBITDA positive in 2H13
Operational beds are unchanged from 1Q13 at 116, with occupancy estimated at c.50-60%
This is on track to meet our expectation of EBITDA contribution of RM16.8m for FY13FMaintain HOLD while our TP is adjusted slightly to account for the weakening in RM against S$
While we believe the long term prospects for healthcare remain positive and IHH commands a premium due to its scarcity and geographical spread, the stock is already trading at 43x/36x on FY13F/14F earnings
UOB KAY HIAN says ...
WING TAI HOLDINGS | BUY | TP: S$2.67
Wing Tai reported 4QFY13 net profit of S$275.8m (81% yoy) bringing FY13 net profit to S$531.1m (102% yoy)
Core net profit of S$458.1 excluding fair value gains (S$52.1m) and the effect of a change in accounting policy (S$20.9m) was above expectations
The strong contribution from the development properties was underpinned by earnings recognised from Foresque Residences, L'VIV, Helios Residences and Belle Vue Residences in Singapore as well as Verticas Residences in Malaysia
FY12) comprising of an ordinary dividend of 3 S cents and a special dividend of 9 S cents (payout - 32% of core earnings)
NTA per share rose 27% yoy to S$3.62/share
Wing Tai's recent launch of the Tembusu project was very well received with over 220 options granted to date (S$1,400-1,500 psf)
We expect Wing Tai to record strong margin of more than 40% for the project due to the low land cost as this site was formerly an industrial building (Wing Tai's headquarters)
During FY13 Wing Tai sold a total of 318 units (FY12: 225 units) in Singapore and 169
units in Malaysia with a sales value of S$725m and S$130m respectively
Management guided a cautious outlook for the Singapore residential market and believes that the new measure introduced on the Total Debt Servicing Ratio (TDSR) framework for property loans is likely to slow the demand for new residential units in
Singapore
Going forward, Wing Tai is expected to launch the Prince Charles Crescent site and its high-end development at Ardmore Park
Wing Tai's net-gearing dropped further to 0.15x (from 0.17x in end-FY12)
Assuming a comfortable gearing of 0.5x, this would provide headroom of over S$700m
The group is on the lookout for suitable investment opportunities in its core markets of Singapore, Malaysia, China and Hong Kong
Maintain BUY with an unchanged target price of S$2.67/share pegged at 20% discount to its RNAV of S$3.33
Wing Tai's low gearing levels and sufficient cash buffer present good acquisition opportunities
DBS Securities says...
GOODPACK | BUY | TP: S$2.00
While FY13 revenue of US$190.7m (+8% y-o-y) matched our estimate, headline net profit came in slightly above at US$51.3m (+13% y-o-y), 6% ahead of ours and consensus' expectations of US$48m
The key variants were the US$1.4m disposal gain of PPE and US$0.9m forex gain as well as lower-than-expected operating expenses in 4Q13
Goodpack is on track to achieve volume growth of 250k boxes in FY14, underpinned by the firm ramp up of new SR markets in Singapore and Russia
Demand from US/Europe markets seems to be stabilizing and bottoming out. It has also made good progress in autoparts market with the secure of 10 new customers in FY13 and is at an advance stage of an approval process with one of the major OEMs in Europe
Valuation is undemanding for Goodpack, trading at 1 SD below mean of 12x FY14PE and 1.8x P/Bv
Our DCF-based TP is raised to S$2.00 as we roll over to FY14, which translates to 15x FY14PE and 2.3x P/Bv or 2-11% discount to historical mean
In addition, Goodpack also offers 3-4% dividend yield based on an informal dividend payout ratio of about 45%
Company declared final dividend and special dividend totaling 5 Scents for FY13
Reiterate BUY for Goodpack's rosy growth prospects and a lucrative 30% upside potential to our TP
The finalisation of autoparts contracts will serve as an imminent catalyst. |
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