sector report

OCBC keeps 'overweight' on Singapore hospitality sector as REITs rally

SINGAPORE (Feb 7): OCBC Investment Research is maintaining “overweight” on Singapore’s hospitality space as the sector’s REITs – namely CDL Hospitality Trusts (CDL HT), Ascott Residence Trust (ART) and Far East Hospitality Trust (FEHT) – rally into the new year with total returns of +5.7%, +2.5% and +6.5%, respectively.

2019 will be a good year for hospitality, but risks from trade tensions remain: OCBC

SINGAPORE (Jan 16): OCBC Investment Research is maintaining “overweight” on Singapore’s hospitality sector as it sees value in some of the hospitality REITs under its coverage at their current unit prices.

OUE Hospitality Trust (OUE HT), Far East Hospitality Trust (FEHT) and Ascott Residence Trust (ART) are OCBC’s top “buy” picks with fair value estimates of 79 cents, 67.5 cents and $1.18, respectively.

Competition heats up in telco sector and the catchphrase is 'free'

SINGAPORE (June 12): UOB Kay Hian continues to rate the telecommunications sector as “market weight” as competition within the sector has intensified even before TPG Telecom has launched its mobile services on a commercial basis.

So far, TPG has launched a mobile plan just for senior citizens aged 65 and above, giving them 3GB of data and unlimited local calls for free for the first 24 months.

In its 1H18 results briefing, TPG disclosed that its data centre and core network in Singapore has been completed and a large number of base stations have already been installed.

S-REIT sector kept at 'overweight' as earnings come within expectations: UOB

SINGAPORE (May 2): UOB Kay Hian is keeping “overweight” on Singapore REITs (S-REITs) post the announcement of Mapletree Logistics Trust (MLT) and Frasers Hospitality Trust’s (FHT) latest set of quarterly results, which the research house continues to rate “hold” and “buy” at target prices of $1.41 and 90 cents, respectively.

In a report last Friday, lead analyst Vikrant Pandey says both REIT’s results came in line with expectations, with MLT and FHT’s respective 4Q and 2Q distributions making up 100.1% and 47.6% of full- and half-year estimates.

Maybank remains 'positive' on S-REITs as industrials are bottoming out

SINGAPORE (Apr 16): Maybank Kim Eng is remaining “positive” on Singapore REITs (S-REITs), despite the recent pull-back in share prices against a rising interest rate regime.

In a Monday report, analyst Chua Su Tye says, “We see positive earnings momentum led by the large cap names from improving supply and demand, with near-term catalysts rising occupancies and stable/positive rental reversions.”

The analyst sees limited risks from higher interest rates given the sector’s well-cushioned balance sheets, with potential acquisition growth upside not priced in.

Fintech players are shaking up the banking sector in SEA

SINGAPORE (Apr 16): CLSA is rating the Asean banking sector “overweight” as it is set to take a different route in the near future with fintech players carving out their paths and partnering the banks in more meaningful ways.

In a Wednesday report, managing director, HK and Singapore Banks of CLSA, Asheefa Sarangi says, “In our view, as a market, Singapore is best positioned from the banks’ perspective.”

Regulatory changes expected to drive earnings for Singapore's land transport sector

SINGAPORE (Mar 22): Phillip Capital is maintaining an “overweight” for Singapore’s land transport sector on regulatory reviews and changes with ComfortDelGro (CDG) its top “buy” pick with a $2.50 target.

In addition, regulatory changes on fare formula and licensing of private-hire car companies could be catalysts for a re-rating for the stock.

In a Thursday report, analyst Richard Leow says, “We forecast CDG's earnings to have bottomed in FY17, with the Public Transport Services segment largely driving earnings going forward.”

Asean's agribusiness kept at 'neutral' by CIMB given CPO price may not be sustainable

SINGAPORE (Oct 11): CIMB is maintaining its “neutral” rating on the Asean agribusiness as the current CPO price may not be sustainable in 4Q17.

In September, crude palm oil (CPO) production fell 2% m-o-m but rose 4% y-o-y to 1.78 million tonnes due to fewer working days as Malaysia observed three public holidays.

Meanwhile, palm oil exports in September rose 2% m-o-m to 1.52 million tonnes, significantly lower than cargo surveyors’ (SGS and ITS) growth estimates for the same period of 10-10.4% m-o-m.

This was due to lower export volumes to Europe and Pakistan.

Could Singapore’s consumer sector see a pickup in investor sentiment?

SINGAPORE (June 13): OCBC Investment is maintaining its “neutral” rating on Singapore’s consumer sector given a lack of broad-based improvement for the retail scene, as well as the continued expansion and growth of e-commerce players.

This comes even as local retail sales data for April registered slightly above consensus, with retail sales up 2.6% on-year on higher sales in discretionary segments like Department Stores and Watches & Jewellery.

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