CIMB Equity Research

Keppel upgraded for contract novation to Borr Drilling on favourable terms

SINGAPORE (March 21): CIMB is upgrading Keppel to “hold” from “reduce” after the rigbuilder says the contracts with Transocean for the five Super B jack-up rigs will be novated to Borr Drilling at US$216 million ($302 million) per rig.

That is almost at a zero discount to its original price of US$219 million per rig.

“We think the Borr contract is a good reference point for ‘realisable value” of undelivered rigs... However, there could still be some impairment in 2017 for mothballing of Singapore yards,” says analyst Lim Siew Khee in a Tuesday report.

Growth on the horizon for Fu Yu Corp after 3-year decline

Fu Yu Corp logo

SINGAPORE (Sept 21): Fu Yu Corporation says its revenue decline over the past three years will see a reversal by early FY17, after bottoming out in FY16.

The precision injection moulds and plastic parts provider explained that its gross margins have risen from 7.1% in FY11 to 16.7% in 1HFY16. In addition, it posted a positive growth in core earnings in FY14 and FY15, even as group revenue continued to slide for the past three consecutive years.

New investment ideas to play the Singapore market

SINGAPORE (Sept 20): CIMB Equity Research has found two new investment themes that local investors can look into, namely the Asean domestic consumption and new technology.

These are on top of the Real Estate Investment Trusts and property segments which CIMB has an “overweight” rating on.

The telco showdown has begun

SINGAPORE (Sept 2): Analysts have begun to price in the real possibility of a fourth telco entering the Singapore market after MyRepublic, AirYotta and TPG Telecom submitted their applications to the Infocomm Development Authority (IDA) on Thursday to bid for the fourth mobile operator licence in the New Entrant Spectrum Auction (NESA) in October.

Memtech kept at ‘add’ by CIMB on the back of an expanding project pipeline

SINGAPORE (June 20): CIMB Equity Research has maintained its “add” call for Memtech International, with an unchanged target price of 86 cents.

Two main segments will drive Memtech’s growth in FY16-17. These are the consumer electronics and automotive engineering, says lead analyst Ngoh Yi Sin in a Monday report.

Memtech has in recent years gained traction in the consumer electronics segment, securing several new orders such as headbands for Beats, Roku’s streaming devices and a potentially new acoustic device for one of Apple’s tablets.

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