broker's report

Further upside to property-related companies on the way, says KGI

SINGAPORE (Oct 21): In September, new home sales reached the highest monthly sales since July 2018, when the latest round of property cooling measures came into effect.

According to data released by the Urban Redevelopment Authority (URA), developers sold a total of 1,270 private residential units, which represented a 13% m-o-m and 36% y-o-y increase.

Analysts stay lukewarm as Soilbuild REIT misses 3Q estimates

SINGAPORE (Oct 21): Analysts are remaining lukewarm on Soilbuild Business Space REIT, after the business park and industrial property trust saw its 3Q19 results come in below expectations.

The manager of Soilbuild REIT on Oct 16 announced a distribution per unit (DPU) 0.918 cents for the 3Q ended September, some 26.3% lower than DPU of 1.245 cents a year ago.

The decline, however, was mainly attributable to an enlarged unit base following its recent preferential offering and the cessation of revenue recognition from NK Ingredients.

Ixom boosts Keppel Infra Trust's 3Q; Basslink drama not likely to have any financial effect, says DBS

SINGAPORE (Oct 18): DBS Group Research is reiterating its “buy” recommendation on Keppel Infrastructure Trust (KIT) with a target price of 58 cents.

This came on the back of the trust announcing that its 3Q19 DPU has remained flat y-o-y at 93 cents.

Distributable cash flow for the quarter came in at $55.7 million, a 61% y-o-y increase over the corresponding period.

Analysts bullish on more acquisitions to boost Keppel DC REIT after 3Q results in line with expectations

SINGAPORE (Oct 17): Analysts believe that Keppel DC REIT could turn to more new acquisition to seek growth, after the data centre trust posted 3Q19 results that were in line with expectations.

For the latest quarter ended September 2019, KDCREIT reported a 4.3% rise in distribution per unit (DPU) to 1.93 cents, on the back of a 5.4% growth in distributable income to $27.4 million.

The higher DPU came despite a 1.8% dip in net property income to $42.3 million, as 3Q19 gross revenue slipped 2.5% to $46.4 million.

Analysts upbeat on Keppel REIT's 3Q performance

SINGAPORE (Oct 17): Keppel REIT announced its 3Q19 results yesterday and analysts say it will continue to do well.

DBS Group Research has maintained its “buy” call on Keppel REIT with a target price of $1.45. CGS-CIMB also made a similar recommendation but has lowered the target price to $1.35, from $1.41 previously.

Keppel REIT’s 3Q19 numbers recorded a 2.9% increase in its DPU to 1.40 cents, compared to 1.36 cents in 3Q18. This came on the back of a 2.5% y-o-y growth in distributable income to $47.5 million.

China Sunsine poised to ride market consolidation, says KGI

SINGAPORE (Oct 16): China Sunsine Chemical Holdings, the largest rubber chemical producer in China, is set to benefit from long-term market consolidation, according to KGI Securities Research.

KGI is re-initiating coverage on China Sunsine with an “outperform” rating and a target price of $1.40, representing an upside of close to 18%.

Analyst Chen Guangzhi notes that China currently accounts for 76% of global rubber chemical production. Meanwhile, only 47 producers supplied 90% of the output to China’s market in 2018.

Sheng Siong likely to be hampered by slow supermarket sales, says Maybank

SINGAPORE (Oct 16): Maybank Kim Eng Research is reiterating its “sell” call on mass-market supermarket operator Sheng Siong Group (SSG) with an unchanged target price of 96 cents, on the back of “tepid” supermarket sales.

Despite improving in August, supermarket sales contracted 0.1% y-o-y for the first eight months of 2019.

According to latest data in the Retail Sales Index, sales for supermarkets and hypermarkets improved 1.8% y-o-y in August – the largest increase since January this year.

New REIT on the block Lendlease Global REIT started at 'outperform' as top S-REIT pick: Daiwa

SINGAPORE (Oct 15): Daiwa Capital Markets is initiating coverage on Lendlease Global Commercial REIT with an “outperform” rating and a target price of $1.01.

According to analyst David Lum, the REIT’s 12-month forward distribution per unit (DPU) yield of 5.6% is higher than the sector average of 5.1% among Singapore REITs – making it an attractive and viable investment option.

ST Engineering expected to soar above peers with latest acquisitions

SINGAPORE (Oct 14): Analysts are bullish on ST Engineering on the back of future trends of its satcom business and recent acquisitions, which are expected to contribute positively to this segment’s growth.

To recap, the group on Sept 17 announced that its US subsidiary iDirect Government has acquired 100% ownership in Glowlink Communications Technology for a consideration of US$20 million ($28 million).

CGS-CIMB bullish on Ascendas REIT but rues expensive valuations

SINGAPORE (Oct 11): CGS-CIMB Research believes investors should “look for a lower entry point” when buying into Ascendas REIT (AREIT), despite being bullish on its growth prospects.

“While we are positive on AREIT due to its dominant market position and visible growth profile, we think valuations are expensive at 5.3% yield and 1.4x P/BV,” says lead analyst Lock Mun Yee in a Thursday report.

The research house is keeping its “hold” call on AREIT, but raising its target price by 1.3% to $3.12.

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