Keppel T&T - Data centre takes centre stage

Stock Name: KepT&T
Company Name: KEPPEL TELE & TRAN

Research House: CIMB

Price Call: HOLD

Target Price: 1.22

Target S$1.22

1Q12 core earnings hit a record with the help of a strong data-centre performance. However, we believe near-term positives are in the price at 9.2x CY13 P/E (vs. 10x historical five year historical average). 1Q12 core net profit (S$14.4m) meets expectations at 20% of our forecast and consensus. We keep our earnings estimates largely intact and SOP-based target price. Maintain Neutral.

Source: CIMB Daybreak - 18 April 2012, Full PDF Report

CIMB downgrades Keppel T&T to neutral

Stock Name: KepT&T
Company Name: KEPPEL TELE & TRAN

Research House: CIMB

Price Call: HOLD

Target Price: 1.22

CIMB Research cut its rating on Singapore logistics firm Keppel Telecommunications & Transportation (Keppel T&T) (KTEL.SI) to neutral from outperform and lowered its target price to $1.22 from $1.24.

Keppel T&T shares were unchanged at $1.23, and have gained 11% since the start of the year.

CIMB lowered its earnings per share estimates for Keppel T&T by 1-5% for 2012-2014 to account for higher interest expense as it borrows more to fund developments.

The broker said that while the company's expansion into Jilin in China should help develop its core logistics business further, meaningful contributions from the country will only come in

“While its core logistics and data-centre earnings could continue to grow, full-year contributions from new warehouse capacity and data-centre expansion are largely in the price,” said CIMB.

 

Keppel Tele and Trans rated 'outperform' by CIMB

Stock Name: KepT&T
Company Name: KEPPEL TELE & TRAN

Research House: CIMB

Price Call: BUY

Target Price: 1.46

CIMB in an Oct 19 research report says: "3Q11 core net profit fell 11.3% y-o-y as investments and logistics revenue declined following the disposal of non-core investments and redevelopment of a warehouse. The impact was partially cushioned by a 15% q-o-q increase in data-centre contributions.

"In the quarter, there was a $24 million gain from the sale of investments in Wuhu Annto ($18.4 million) and others ($5.8 million). KPTT's logistics business is trading at 4.7x CY13 P/E, near its 3x trough during the global financial crisis. Target price of $1.46.

"KPTT is determined to develop its core operations as it continues to divest non-core investments. While this temporarily affected 3Q11 results, we see longer-term rewards. Coupled with near-trough valuations, KPTT is still a buy! OUTPERFORM."

Keppel Telecommunications & Transportation rated 'outperform' by CIMB

Stock Name: KepT&T
Company Name: KEPPEL TELE & TRAN

Research House: CIMB

Price Call: BUY

Target Price: 1.61

CIMB in a July 20 research report says: "2Q11 core net profit ($17.6 million, +27.8% y-o-y) came largely in line with our expectations. 1H11 core net profits formed 42% of our FY2011 estimates.

"Key variances came from (i) slightly lower-than-expected topline offset by lower-than-expected operating costs leading to higher-than-expected margins and (ii) higher-than-expected depreciation and interest expense. Therefore, we tweak our operating expense assumptions, leaving our FY2011-2013 estimates largely unchanged.

"However, our target price rises to $1.61 (from $1.57), still based on sum-of-the parts valuations, helped by M1's recent price increase. KPTT achieved record operating profit this quarter, which reflects success in its efforts to strengthen its core operations. MAINTAIN OUTPERFORM."

CIMB starts Keppel T&T at outperform, target $1.57

Stock Name: KepT&T
Company Name: KEPPEL TELE & TRAN

Research House: CIMB

Price Call: BUY

Target Price: 1.57

CIMB Research has initiated coverage of logistics firm Keppel Telecommunications & Transportation (KPTT) (KTEL.SI) with an outperform rating and a target price of $1.57.

KPTT’s data-centre operations is a key growth driver and the firm is also expected to increase warehouse capacity in Singapore and China, CIMB said.

The brokerage also noted that KPTT could also expand its interest in its Vietnamese logistics joint venture following a lifting of foreign investment restrictions in the country. Management is also eyeing acquisitions in Asia.

KPTT’s stock remains undervalued, and catalysts for a re-rating could come from major acquisitions and contract wins, CIMB said.

At 10:44 a.m., shares of KPTT were 2.3% higher at S$1.34. They have fallen about 5% since the start of the year.