DMG, which has a Buy rating with a $2.20 target, says the results were within expectations; the strong performance was underpinned by higher contributions from three domestic residential projects and an improved performance from its 35%-owned HK associate.
DMG & Partners Securities in a Jan 25 research report says: “Controlling shareholder, Eight Capital Inc., is selling 75 million of its First Resources’ shares (bringing its stake down from 74% to 68.2%) and FR is selling 15 million treasury shares, at $1.48 per share (8.1% discount to 19 Jan’s close).
DMG & Partners Securities in a Jan 17 research report says: “Sembcorp Marine (SMM) has won a shipbuilding and three upgrading jobs valued at $215 million for various customers. We estimate that total outstanding orderbook climbed to $5.7 billion, with deliveries extending up to end 2013 and is 1.4x annualised FY10 revenue.
DMG & Partners Securities in a Jan 14 research report says: “Renewable Energy Asia Group (REAG) has secured another concession to develop a 49.5MW wind farm with its JV partner, China Datang Corporation Renewable Power Co (China Datang). The wind farm will be located in Binhai New Area, Jiangsu Province, China.
DMG & Partners Securities in a Jan 13 research report says: “We hosted Sino Grandness (SFGI) at OSK-DMG‟s ASEAN corporate day on Jan 7, 2011 and investors’ response was positive. SFGI show-cased demo of its new TV-commercial, which will be aired after the Chinese New Year.
The house raises its fiscal FY12 average daily turnover assumption by 8% to $1.90 billion on expectations trading volumes will rise, “given increased interest in market developments in the U.S. and EU, and on the domestic front.”
DMG & Partners Securities in a Jan 10 research report sas:Â “STX OSV is one of the leading global shipbuilder of offshore support vessels (OSV) with nine shipyards in four countries.
DMG initiates STX OSV (MS7.SG) at Buy with a $1.56 target price.
It says the company is in a good position to capture the returning demand for high-end platform supply vessels and offshore subsea and construction vessels, given its leading edge technology and strong market share in the high-end segments.
“We expect prices to be supported as investors continue to pursue yields. Investors are also likely to be attracted to assets that offer an inflation hedge by allowing for continuous re-pricing of cash flows with a dynamic earnings model.”
DMG raises SembCorp Marine’s (S51.SG) target to $5.30 from $4.70 and maintains its Neutral rating.
After SembMarine announced an order win from Noble Corp for two premium jackup rigs valued at US$400 million ($525 million) plus options for four more, the house estimates that SembMarine’s total outstanding order book is now around US$5.3 billion, with deliveries stretching up to 2Q 2013.
DMG raises its FY11-12F EPS estimates by 4.0% and 10% respectively to reflect the new jackup orders from Noble and higher margins on repeat orders.
Wilmar (F34.SG) extends its fall, and is down 4% at $5.69 as investors take a dim view of the group’s foray into the property market.
DMG says “while the investment amount of US$134 million ($176 million) is small…and we have no doubt about the eventual profitability of the project…the entry into the property market represents Wilmar’s first ever deviation from its core agribusiness.” House fears this could mark the start of a “loss of business focus and corporate discipline.”
DMG says it’s optimistic on the potential arising from Singapore Airlines’ (C6L.SG) acquisition of a 16% stake worth $65 million in China Cargo Airlines, announced Monday.
“While management has not provided any guidance on the outlook specifics, SIA’s pivotal role in the route optimization of China Cargo Airline’s freighter carriers could potentially see SIA offering direct connectivity between China and Singapore (and Asean for the matter) and Australia, while China Cargo Airlines would be dedicated to traffic in/from the mainland China region.”
DMG & Partners Securities in a Dec 17 research report says: “The Think Environmental Co (TENV) announced it has entered into a MOA with Mornington Offshore Inc (Mornington) for the proposed investment in the latter which owns 100% stake in a gold exploration company, Societe Emas Mali SA (SEM).
DMG cuts Think Environmental (A78.SG) target price to $0.135 from $0.350 and keeps the stock at Sell after the company announced it has entered into a MOA with Mornington Offshore for the proposed investment in the latter which owns 100% stake in a gold exploration company, Societe Emas Mali.
The house says details of the investment in Mornington “remain scanty,” but views the move into offshore gold mining negatively “due to its shift in focus away from the troubled environmental business, and the lack of experience in offshore gold mining in a new country.”
Yangzijiang (BS6.SG) is up 1.1% at $1.91 after the shipbuilder says it has entered an agreement to acquire 100% of Jiangsu Zhongzhou Marine Equipment — which owns shipbuilding facilities of 350,000 square metre yard space, 430 metre deep water coast line — for RMB420 million ($82.7 million) (implied P/E of 7.7x and 1.2x NAV).
Ezra (5DN.SG) is +2.4% at $1.71, a three-week high, as it continues to recover from a nearly seven-month low of $1.63 touched earlier in December.
The offshore oil and gas support company has underperformed peers, down 8.2% since 2H10’s start, compared with the FTSE ST Oil & Gas Index’s +23.8%, partly on disappointment with its quarterly results and the company’s persistent delays in taking delivery of new vessels.
