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Singapore a balancing act in 2011 - UOB Kay Hian

Tags: A-REIT | Keppel corp | OCBC | OUE | Sabana REIT | Singtel | Starhub | Tiger Airways | UOB Kay Hian

Written by Dow Jones & Co, Inc   
Wednesday, 12 January 2011 15:30
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UOB KayHian says with slower Singapore GDP growth in 2011 and reasonable (but not cheap) valuations, “investors will need to balance their portfolios between: a) large-cap stocks with value or yield and b) reasonably priced mid-cap stocks with specific catalysts or good growth prospects.” 

It adds, the STI’s 2011F P/E of 15.4X looks reasonable vs its long-term mean of 16.9X. The house is Overweight on banks, office/industrial property and oil services. 
 
It says its key Sells include Keppel Corp (BN4.SG), CapitaLand (C31.SG), SingTel (Z74.SG) and Tiger Airways (J7X.SG). "“We remain negative on SingTel, preferring StarHub (CC3.SG) and M1 (B2F.SG) for their higher dividend yields.” 
 
Among banks, top pick is OCBC (O39.SG) for its strong overseas presence, which will help drive loans growth and better margins. 
 
The house’s commercial property top pick is OUE (LJ3.SG) “as it is a key beneficiary of improving prospects for office property.” 
 
In industrial property, it favours A-REIT (A17U.SG) and Sabana REIT (M1GU.SG). The house has a 2011 STI target of 3550 vs 3240 currently.
 
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Singapore a balancing act in 2011 - UOB Kay Hian
Wednesday, 12 January 2011

Last Updated on Wednesday, 12 January 2011 15:44
 

Comments 

 
0 #1 Wiratna Widjaja 2011-01-13 15:10 I think M1 and Starhub have different scope of growth with SingTel. SingTel has been investing in overseas telcos (India, Australia, and Indonesia, especially India and Indonesia, huge populations there). I won't only look into the high dividend yields, but also the growth the company for long term. With limited telco market share for Singapore, how far a telco company can grow if they are not expanding to overseas?