OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: PanUnited
Company Name: PAN-UNITED CORPORATION LTD

Research House: DBS Vickers

Price Call: BUY

Target Price: 1.21

Stock Name: SIA
Company Name: SINGAPORE AIRLINES LTD

Research House: UOB KayHian

Price Call: HOLD

Target Price: 11.50

Stock Name: Ascendasreit
Company Name: ASCENDAS REAL ESTATE INV TRUST

Research House: Nomura

Price Call: BUY

Target Price: 2.61

Market Compass

18 October 2013~ Good Morning Singapore!

Singapore Idea Snippets:

18 Oct 2013 ~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day : Architecture should speak of its time and place, but yearn for timelessness. - FRANK GEHRY Singapore: The Day Ahead SINGAPORE DAYBOOK : Improving tertiary education not just a numbers game: PM Lee. Unis must provide skills relevant in the future and which lead to good jobs [SINGAPORE]The government's efforts to improve Singapore's tertiary education system cannot be just about increasing the number of university places, says Prime Minister Lee Hsien Loong. Some countries have found that having a large proportion of their students going to universities "does not necessarily guarantee happy outcomes", he said at the opening ceremony of the National University of Singapore's (NUS) University Town campus last night. About 27 per cent of each cohort of students currently get a place in one of Singapore's publicly funded universities, and the target is to hit 40 per cent by 2020. In his speech, Mr Lee talked about the situation in South Korea, where more than 70 per cent of each cohort attend university. (Source: The Business Times) MARKET SCOOP Cosco Shipyard unit bags contracts worth US$233.3m SGX Q1 net profit rises 24% as revenue gains Grow-Tech Properties is top bidder for both Gambas Crescent plots Qian Hu reports S$88,000 Q3 profit Keppel Corp Q3 net profit rises 32% on property earnings Planned OUE Reit to include Shanghai's Lippo Plaza Asiasons to relook Black Elk deal after SGX rejects new share issue Singapore NODX contracts 1.2% in Sept (Source: The Business Times) DBS VICKERS Securities says ... PAN-UNITED CORPORATION | BUY | TP: S$1.21 Post acquisition of MIIF's 34.2% stake for S$101m (out of MIIF's 38% in CXP), CXP now contributes more significantly to PAN's earnings (27% vs 18% previously) Based on our estimates, the acquisition is earnings accretive and will improve FY14F's earnings by 10% We visited CXP port to gain further insight to its operations and have confidence that CXP is capable of contributing a sustainable stream of earnings to PAN going forward CXP is strategically located along the Yangtze River and is capable of serving 100,000 dwt vessels CXP enjoys a low 30% breakeven utilisation for its operations with port operational functions outsourced to third parties Cargo volumes have grown at 9% CAGR since 2005 We expect cargo volumes to be supported by robust log demand and expansion of steel and paper mills in the area As there is no longer a requirement that was made by MIIF to pay out 100% of earnings as dividends at CXP's level, management has more financial resources available to further develop the port in areas such as warehousing The CXP visit has given us confidence that earnings will be sustainable going forward We have not made any major changes to our forecast and outlook for now PAN should be able to maintain DPS despite retaining some portion of CXP's earnings for port development Reiterate BUY and S$1.21 TP UOB KAY HIAN says ... SINGAPORE AIRLINES | HOLD | TP: S$11.50 Pax traffic rose 1.8% in Sep and 4.9% for 2QFY14. 2Q loads improved 1.3ppt on the back of strong demand during Hari Raya period coupled with summer holiday leisure travel Cargo traffic declined 6.7% in sep and 7.2% during the quarter Key highlight was the 4.5ppt improvement in Europe loads for the quarter SIA attributed the improvement to better capacity management rather than a demand pickup SIA noted that efforts to boost loads continue to place downward pressure on yields Yields fell 2.6%yoy in 1Q due to competition and forex impact Loads fell 4ppt for Sep and 3.5ppt for 2Q marking the seventh consecutive month of decline Key reason was the 11.8ppt decline in West Asia loads as capacity growth far outpaced demand increase Overall some encouragement on the pax front with loads improving 4.9%yoy and 2.1%qoq 2Q loads are 1.3ppt above 2Q13 break-even loads indicating better results if yields remain firm.SIA will be reporting the results on 12th Nov(after market close) We will do a detailed results preview closer to the announcement date Maintain HOLD fair price of S$11.50, valuing it at 0.8x FY14's book value(ex- SIAEC) NOMURA Securities says... ASCENDAS REIT | BUY| TP: S$2.61 AREIT reported its 2QFY14 results on 16 October after the market closed 2QFY14 DPU of 3.6Scts (+2%y-y; +1.4%q-q) brought the 1HFY14 DPU to 7.2Scts (+1.3%y-y), which met 53.1% of our full year forecast of 13.5Scts The better-than-expected 1H performance was principally on account of: 1) marginally higher NPI; 2) lower net interest expense and 3) higher distribution from AREIT's China investment AREIT's aggregate leverage was 29.7% as of end-September (from 28.6% as of end-June; 30.5% if committed but yet-to-be-funded capex of SGD73mn were to be included) The SGD395mn CMBS due in mid-2014 could be refinanced by drawing from the SGD1.2bn revolving credit facility (33% drawn as of end-September), according to management The 2.1-3.7%q-q decline in market rents for AREIT's Business and Science Park (BSP) as well as light industrial and flatted factory portfolios during the quarter suggests a still challenging operating environment That being said, AREIT's overall portfolio appears to have held up quite well despite the challenges New and expansion leases of 53,461 sq m were signed during the quarter (vs. 44,873 sq m in 1QFY14 and 28,628 sq m in 2QFY13) with an increase of 1.5-14% in new take up rates (vs. a decline of 2.6-8% during the previous quarter) On a same-store basis, overall portfolio occupancy was slightly higher at 94.9%, vs. 94.8% at the end of the previous quarter With the exception of the previous Ultro Building (no pre-commitment yet) and the LogisTech new annex block (still in negotiation with prospective tenant), leasing for newly created space within the portfolio also appears brisk Commitment at Nexus increased to 73.9% by end-September (from 55.7% at end-June) and management expects commitment to exceed 80% soon The new factory block at Techplace II is now 22% committed Pre-commitment of the upgraded space at 31 IBP improved to 81.5% as of end-September (from 76.7% at end-June) Including leases under offer, the new warehouse space at Xilin Districentre Building D is almost fully committed In our view, AREIT's valuation remains relatively undemanding at P/B of 1.2x, based on the end-September book value of SGD1.90/unit, compared to the historical trading average of 1.3x Maintain Buy

OSPL - Good Morning S'pore - Central Dealing Desk

Stock Name: PanUnited
Company Name: PAN-UNITED CORPORATION LTD

Research House: DBS Vickers

Price Call: BUY

Target Price: 1.16

Stock Name: SPH
Company Name: SINGAPORE PRESS HLDGS LTD

Research House: StanChart

Price Call: BUY

Target Price: 4.99

Stock Name: CapitaMall
Company Name: CAPITAMALL TRUST

Research House: OCBC

Price Call: BUY

Target Price: 2.32

Market Compass

08 April 2013~ Good Morning Singapore!

Singapore Idea Snippets:

08 April 2013~ Good Morning Singapore! Central Execution Team - The Excellence of Execution This product is made available by your Central Execution Team, for you as TRs of OCBC Securities to help you with your business and therefore it is confidential and only for internal circulation. It is not intended for onward circulation to non-OSPL TRs, clients or any other third party in this or any other version. Neither is this intended to be relied upon as a sole basis for any recommendation. TRs must also consider their clients' investment objectives, financial position and needs when intending to make or making any recommendation. For the front desk, by the front desk. All feedback to make this a better product is welcome. Global Flash: While You Were Sleeping Source: Marketwatch Quote for the day :Success is a lousy teacher. It seduces smart people into thinking they can't lose. - BILL GATES Singapore: The Day Ahead SINGAPORE DAYBOOK:Park Hotel Grp seen seeking $1b for Orchard Rd hotel. Total price tag pegs hotel's value in the high-$1m range per room. [SINGAPORE] Park Hotel Group, which announced a $300 million or $893,000 per room sale of its Park Hotel Clarke Quay to Ascendas Hospitality Trust over the weekend, is understood to have put some of its other hotels on the market as well. Industry players say these include its two remaining Singapore hotels - Grand Park City Hall in Coleman Street and Grand Park Orchard (along with its retail podium Knightsbridge). The group is said to be seeking more than $1 billion for the latter asset or a whopping sum in the high-$1 million range per room - which if achieved would reprice the Singapore hotel market, according to industry players. The asset comprises the 308-room Grand Park Orchard and about 74,000 sq ft net lettable area of retail space - leased to retailers such as Abercrombie & Fitch, Topshop/Topman, Brooks Brothers, Tommy Hilfiger, Dickson Watch & Jewellery, and The Hour Glass. MARKET SCOOP Interra to drill new well in Myanmar Singapore's Temasek launches new firm for LNG investments MCT issues S$70 million fixed rate notes Govt closes car loan loopholes Olamwithdraws lawsuit against Muddy Waters and its founder Fu Yu seeks trading halt on SGX's query on price, volume surge DBS VICKERS Securities says... PAN-UNITED CORPORATION | BUY | TP: S$1.16 We believe the port business is currently undervalued Our current valuation of CXP port stands at 7x FY13F earnings vs peer average of China listed ports at 12.2x We believe placing 12.2x earnings multiple on the port business is fair to our valuation of PAN as it reflects a more representative value to assets that the company holds Our analysis into the MRT construction projects suggests that we may see concurrent construction for five MRT lines at various stages in 2015 We expect PAN to re-rate to +2SD of its mean valuation ahead of the construction peak in 2015. We conservatively re-peg CXP's value in PAN's SOTP valuation from 7x PE to 12x, in line with China-listed ports We raise PAN's TP to S$1.16, implying 13.9x FY13F PE, which is slightly above +1SD but below +2SD of its mean valuation STANDARD CHARTERED Securities says... SINGAPORE PRESS HOLDINGS | OUTPERFORM | TP: S$4.99 SPH announced an agreement to acquire all the issued shares of Sgcarmart, a vehicle classifieds site and car auction platform We welcome the deal as it provides synergies to SPH‟s online classifieds business The deal, which involves acquisition of the entire issued capital, will be fully financed by cash SPH already owns the online car portal, STCars, in addition to STJobs, STProperty and STClassfieds In our view, the Sgcarmart acquisition will tighten SPH‟s grip on the online classifieds market The proposed REIT listing would strengthen SPH‟s dividend stream and also enhance its value Its 6.0% (2013E) yield is the highest among classic Singapore yield plays, and is above the peer group average of 37% OCBC Securities says... CAPITAMALL TRUST | BUY | TP: S$2.32 CapitaMall Trust (CMT) has been a clear laggard within the S-REITs space, staying flat YTD versus an average of 11.0% increase in unit prices for its local retail peers (FTSE ST REIT Index: 7.2% YTD) We believe this is unjustified given its portfolio of 15 quality retail malls, which are strategically located in the suburban areas and downtown core of Singapore, and its relentless efforts in optimizing its yield via asset enhancement initiatives (AEIs) According to CBRE, the average rents in prime Orchard Road rose for the first time (up 2% QoQ) in 1Q13 after staying flat since 3Q11 While the suburban retail will see a substantial amount of space (~1.6m sqft) coming online in 2013, CBRE notes that retailers are still upbeat about the suburban market (1Q13 rents flat QoQ) This is consistent with our view that both Orchard Road and suburban rents may possibly remain firm in 2013 We are keeping our S$2.32 fair value unchanged and maintaining BUY on CMT as we expect the valuation gap to narrow between CMT and its peers

Pan-United Corporation rated 'buy' by DBS

Stock Name: PanUnited
Company Name: PAN-UNITED CORPORATION LTD

Research House: DBS Vickers

Price Call: BUY

Target Price: 0.68

DBS Vickers Securities in a Feb 28 research report says: "Pan-United reported a strong earnings recovery in FY2011 underpinned by volume growth and margin expansion. Net profit surged 50% y-o-y to $30.4 million in line with our revised estimates.

"Revenue grew 31% y-o-y to RMB512.7 million, driven by robust ready-mixed-concrete (RMC) demand and port business. Gross margin expanded 2.1ppts to 16.1%, the highest since 2009 (peak was 18.9% in 2008). Company declared a higher than expected final dividend per share (DPS) of 2.0 cents (vs 1.5 cents previously), bringing FY2011 DPS to 3.5 cents.

"We expect similar dividend payout in 2012 assuming sustainable operating profits, translating to an attractive annual dividend yield of c.7% for FY2012. Sum-of-the-part-based target price is adjusted to 68 cents, as we roll over our valuation to FY2012. MAINTAIN BUY."

Pan United Corporation rated 'invest' by SIAS Research

Stock Name: PanUnited
Company Name: PAN-UNITED CORPORATION LTD

Research House: SIAS

Price Call: BUY

Target Price: 0.63

SIAS Research in an Aug 15 research report says: "On the back of higher sales volume, better selling prices and effective cost control, Pan-United Corp Ltd's (Pan-U) 2Q FY11 revenue and PATMI grew 27% and 75% y-o-y to $129 million and $8.78 million respectively.

"1H revenue and PATMI formed 51.3% and 56.7% of our FY2011F. There was a slight surprise in profit margin for this quarter owing to sustained gross profit margin and well controlled operating costs. Developments in Indonesia and Vietnam are progressing as per projected and initiatives are taken to minimise losses at the shipping division.

'We will revise our FY2011 forecasts upward should the BBM division continue to maintain its margin. Intrinsic value of 63 cents per share. MAINAIN INVEST."

Pan-United Corporation rated 'buy' by DBS

Stock Name: PanUnited
Company Name: PAN-UNITED CORPORATION LTD
Research House: DBS Vickers

DBS Vickers Securities in a Mar 1 research report says: "4Q10 net profit climbed 53% q-o-q to $6.1 million on strong margin recovery of 5.4ppt to 18.2% and revenue growth of 9%. FY2010 net profit was $20.3 million, well in line with our estimate of $20.0 million. Margin expansion was largely attributable to higher ASP for ready-mixed concrete (RMC).

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