CGS-CIMB Research

CGS-CIMB has eyes on Boustead Projects after order book hits record

SINGAPORE (June 21): Boustead Projects, the industrial property designer and building solutions provider, is now on the radar screen of CGS-CIMB Research after its order book hit a record high of $660 million.

This figure comprises of values of both the company’s remaining unrecognised project revenue at the end of FY19 and the new orders secured since then – including sizeable contracts for the JTC multi-storey recycling facility and Surbana Jurong Campus.

Virtual banks not a threat to Singapore banks – for now, says CGS-CIMB

SINGAPORE (June 20): The Monetary Authority of Singapore (MAS) is studying the potential for opening the doors to “digital-only banks with non-bank parentage”.

But CGS-CIMB Research dismisses fears that such virtual banks on could put a dent in the market share of incumbents DBS Group Holdings (DBS), Oversea-Chinese Banking Corp (OCBC) and United Overseas Bank (UOB) – at least for now.

“We think that virtual banks are not likely to threaten the primary lending businesses of DBS, OCBC and UOB in the near term,” says lead analyst Andrea Choong in a report on Wednesday.

ESR-REIT kept at 'add' pending clarity on equity fund raising to revitalise portfolio, repay debt

SINGAPORE (June 19): CGS-CIMB Research is maintaining its forecasts on ESR-REIT “pending greater clarity” on details of an equity fund raising to raise up to $150 million.

The brokerage is keeping its “add” recommendation on ESR-REIT with an unchanged target price of 60 cents.

The manager of ESR-REIT earlier this week announced the proposed equity fund raising exercise.

SATS kept at 'buy' by CGS-CIMB on strategy of buying out rivals

SINGAPORE (June 17): CGS-CIMB Research is maintaining SATS at ‘add’ given the stock is a proxy for secular growth in air travel although M&As may require investor to be patient in the short term.

CGS-CIMB says secular demand for travel is key growth driver for SATS. Over the past 19 years, SATS has seen an expansion of the food and gateway services it provided, with capacity handled growing from 22 million passengers in FY00 to 128 million in FY19.

SingTel kept at 'add' by CGS-CIMB amid signs of EPS turnaround

SINGAPORE (June 14): CGS-CIMB Research believes Singapore Telecommunications (SingTel) could have seen a bottoming of its earnings per share (EPS) decline, after falling 21.4% in FY19.

“We see Singtel’s core EPS inching up by 1.8% y-o-y in FY20F, then growing 9.3%/5.5% y-o-y in FY21/22F,” says analyst Foong Choong Chen in a Thursday report.

The way Foong sees it, better associate earnings and narrower Group Digital Life (GDL) losses will help offset earnings pressure from Singapore consumers, Group Enterprise (GE) and a weaker Australian dollar in FY20F.

China could give healthcare players a shot in the arm, says CGS-CIMB

SINGAPORE (June 11): CGS-CIMB Research says China could be the “cure” for anaemic local growth among Singapore-listed healthcare providers, with a total healthcare market size that is some 46 times larger.

“China is an attractive market for Singapore healthcare companies,” says analyst Ngoh Yi Sin in a sector note on Monday. “China’s healthcare expenditure is projected to grow from RMB 5.3 trillion ($1.0 trillion) in 2017 to RMB 8.0 trillion in 2020F, but supply – especially private healthcare – still lags demand.”

Singapore's main real estate brokerages offer great value and defense, say analysts

SINGAPORE (June 7): Phillip Capital and CGS-CIMB Research are initiating positive coverage on both APAC Realty and PropNex, the two main market players within Singapore’s real estate brokerage sector.

In a Monday report, Phillip analyst Tara Wong says she likes both stocks for their market dominance within the real estate brokerage market in Singapore, which in turns allows to them to capture a substantial amount of transactions in both buyer and seller markets.

Analysts expect a more exciting performance from mm2 Asia in FY20

SINGAPORE (June 4): DBS Vickers Securities is upgrading its call on mm2 Asia from “hold” to “buy” while raising its target price by a cent to 34 cents, which is pegged to 16 times FY20F earnings for the core business, and in line with listed peers in Asia.

Meanwhile, CGS-CIMB Research maintains its “add” call on the stock with an unchanged target price of 37 cents.

CGS-CIMB keeps UOB as top bank sector pick despite underperforming NIM expansion

SINGAPORE (June 3): CGS-CIMB Research is keeping United Overseas Bank (UOB) as its top pick among the Singapore banks, despite the bank’s NIM expansion underperforming compared to its peers.

According to lead analyst Andrea Choong, UOB’s valuations are inexpensive at 1.0 times FY19F price-to-book value (P/BV) – close to 1 standard deviation below its long-term mean. The bank also offers a FY19F dividend yield of 5.1%.

Memtech minority shareholders should take $1.35 cash offer, says CGS-CIMB

SINGAPORE (May 29): CGS-CIMB Research says minority shareholders of Memtech International (MTEC) should take the cash offer of $1.35 per share, which the brokerage deems to be a “fair” offer price and an “attractive cash exit opportunity”.

“While we like MTEC for its material science expertise in liquid silicone rubber (LSR) and its diversified customer base, we think its near-term outlook could be weighed down by ongoing trade tensions and a global auto slowdown,” says analyst Ngoh Yi Sin.

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