SG: MARKET PULSE: Astro, KepLand (12 Sep 2013)

Stock Name: KepLand
Company Name: KEPPEL LAND LIMITED

Research House: OCBC

Price Call: BUY

Target Price: 4.09

MARKET PULSE: Astro, KepLand

12 Sep 2013

KEY IDEA Astro: Maintain BUY with lower MYR3.21 FV Astro Malaysia Holdings Berhad (Astro) saw 1H14 revenue +13% at MYR2314.1m, meeting 24.5% of our full-year forecast, while net profit eased 2% to MYR213.0m, or 21.4% of our FY14 forecast. Astro has declared another 2.0 sen interim dividend (30 Sep entitlement date/18 Oct payment date), bringing its payout so far to 4.0 sen. While 1H14 results were tracking slightly below our forecast, we opt to leave our estimates unchanged as we still expect Astro to gain traction in both customer and ARPU growth. We are also keeping our free cash-flow assumptions for now. However, our DCF-based fair value dips slightly from MYR3.26 to MYR3.21 due to a higher risk-free rate assumption. But given that there is still a total return of 11%, we maintain BUY on the stock. (Carey Wong) MORE REPORTS Keppel Land: Sells stake in Indonesian hotel KPLD reported that it has entered into an agreement for a subsidiary to sell its 50% stake in PT Pantai Indah Tateli, a Indonesian company which owns Hotel Sedona Manado in Indonesia, for USD 7.0m (S$8.8m). The price was arrived at on a willing-buyer, willing seller basis and took into account prices of comparable properties in the vicinity. We expect some divestment gains in the ballpark of S$3.0-5.0m from this sale, given that the unaudited book value attributable to KPLD's stake was S$3.2m as at 31 Aug 2013. Given the size of the transaction, however, the impact on RNAV is likely to be limited. Maintain BUYwith an unchanged fair value estimate of S$4.09 (30% RNAV disc.) (Eli Lee)

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