Daiwa says NPI was 5% higher than forecast, while DPU was 3% higher. “The stronger-than-expected NPI came almost solely from the Renhe Spring Zongbei Property in Chengdu, China, which reported NPI of S$3.38 million (+72% on quarter).”
Daiwa has lowered its earnings forecast for SIA by 6-17% for fiscal years 2011-2013 to account for higher jet-fuel prices and to include cargo price-fixing penalties.
Daiwa Research in a Jan 12 research report says: “SingTel’s stake in Bharti has increased by just 0.1 of a percentage point. Hence, we expect the earnings accretion resulting from the current transaction to be very small (less than 0.2% upside for our FY12 EPS forecast).
“The latest announcement supports our belief that SingTel could be a logical buyer in the event that Vodafone Group decides to divest its effective 4.4% shareholding in Bharti. That said, in our opinion, SingTel’s future course of action with regards to possible stake increases is difficult to predict, as we think such a move may require the consent of the Bharti Enterprises, the key indirect shareholder of Bharti.
“Sum-of-the-parts-derived six-month target price of $3.09. SingTel looks fairly valued to us, with the stock trading currently at a PER of 12.1x on our FY11 EPS forecast. MAINTAIN HOLD.”
Daiwa Research in a Jan 11 research report says: “For 2Q FY11, we forecast a net profit of $76.6 million (up 6.8% y-o-y) and revenue of $166.4 million (up 10.4% y-o-y).
From a regional perspective, Daiwa says it expects ASEAN markets to build on their gains for 2010 in 2011, “as corporate earnings ride on robust household spending and rising infrastructure investment.”
Daiwa forecasts Singapore Press Holdings (T39.SG) will report a 1Q FY11 adjusted net profit of $126.6 million (down 12.5% on year), “due primarily to a lack of property-development business in 1Q” (says Clementi Mall will contribute only in 2Q) on revenue of $344.0 million.
The house’s forecast is 9.6% above consensus “which we attribute to our forecast of continued strong advertising volume growth throughout FY11 due to a resilient domestic consumer economy.”
Daiwa cuts Wilmar’s (F34.SG) target price to $6.73 from $7.49, based on a lower 14.4x FY11 P/E vs 16.2x FY11 P/E previously, to reflect its concerns over the agribusiness group’s venture into the real estate business.
“We believe investors will see this as a strategic divergence from its core (business), will raise concerns that the company is running out of investment opportunities in its core business, and have investors questioning why Wilmar is being used for this project.”
Daiwa keeps Olam International (O32.SG) at Buy with a $3.52 target price. Expects the situation in Ivory Coast — where there is civil unrest after a disputed election — will have a neutral impact on Olam.
“We expect Olam to generate more cocoa volume sales, but a thinner unit contribution” in 2Q-3Q FY11. Says Olam would theoretically face a price risk from the change in cocoa prices from the time of the cocoa harvest (typically October-December in Ivory Coast) and the time it can reset its hedge via deliverable futures.
Daiwa Securities in a Dec 6 research report says: “We see more challenging y-o-y earnings comps in 2011, with the Felix acquisition rolled in fully and volume growth slowing through 2012. Seasonal factors remain positive for coal prices.
Daiwa Securities in a Dec 6 research report says: “The Shanghai aluminium price has underperformed the global aluminium price significantly since mid-2010 due to oversupply.
Daiwa keeps Singapore Exchange (S68.SG) at Outperform; says share-price decline of 9.3% since merger proposal with ASX (ASX.AU) “has more than priced in the key negative factors, such as ROE deterioration, increased gearing, and a potential market-share loss for ASX.”
Continues to like SGX as merger should improve operating efficiency, “we also believe an enlarged market could make SGX more attractive as a fund-raising location for companies.”
Keppel (BN4.SG) has “a very high chance” of winning 6 rig contracts from Petrobras, while SembMarine (S51.SG) will probably not receive any from Brazilian oil giant, which recently unveiled outcome of 28-rig tender exercise, says Daiwa.
Daiwa Research in a Nov 18 research report says: “The gross-profit margin came in at 16.4% for 3Q10, down from 18.2% for 2Q10, as a result of a decline in ASPs and slight increase in wafer prices. STP’s 3Q10 net profit of US$33m was below our forecast of US$52m due to a lower gross margin and net hedging loss of US$32m.
Daiwa raises Olam International’s (O32.SG) target price to $3.52 from $2.94 due to higher peer multiples, keeps Buy call.
Daiwa says 1Q (slow season) results were inline financially, operationally, with house, consensus forecasts, management guidance. In addition, Olam is “on plan” with strategy to expand adjusted net profit at CAGR of 25% for FY09-FY15. Notes “the 1Q FY10 numbers were ‘clean’, without disappointments or distorting one-off items.”
Daiwa upgrades Genting Singapore (G13.SG) to Buy from Outperform, lifts target price to $2.93 from $2.06 based on 18x EV/EBITDA vs 15x previously. Says improved operating environment due to duopolistic Singapore gaming market structure, plus lower tax rate, will continue to support company’s operations. Expects softer 3Q10 results vs 2Q10, tips 11% sequential improvement in 4Q10 EBITDA on year-end seasonal effect. Shares last down 5.7% at $2.15.
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