Good Time to BUY M1 Ltd

• Met 73% of our 9M17 estimate
• NB-IoT network takes time to ramp up
• Maintain HOLD

9M17 Revenue Growth Driven Mainly by Fixed Services

 

M1 Ltd’s (M1) 3Q17 revenue grew 1.0% YoY to S$251.6m driven mainly by fixed services (+19.9%) and mobile post-paid (+3.4%) revenues but partly offset by weaker handset sales (-13.6%) and international call services (- 7.0%). Fixed services revenue growth was driven by a 20.0% YoY increase in customer base despite recording 6.1% decline in ARPU, while mobile revenue growth was mainly driven by higher post-paid customer base and flat YoY ARPU.

3Q17 operating expenses rose at a slower pace of 0.6% YoY to S$209.1m due to a 21.8% decline in advertising and promotion expenses, offset by higher depreciation. Consequently, EBITDA increased 1.3% YoY to S$75.5m. However, NPAT fell 4.8% YoY to S$32.7m as taxation increased 13.1% to S$7.2m. For 9M17, revenue rose 2.3% YoY to S$763.9m driven mainly by fixed services and handset sales.

However, operating expenses grew 4.8% to S$633.3m due to higher handset costs and higher wholesale costs of fixed services. Consequently, 9M17 NPAT declined 13.9% YoY to S$68.6m and EBITDA fell 5.0% to S$228.0m, which formed 72% and 73% of our FY17 forecasts, respectively.

No Change in FY17 Outlook Guidance

For FY17, M1 keeps its guidance unchanged:

1. capex to be around S$150m,
2. expects NPAT to decline YoY for FY17, and 3) intends to maintain 80% dividend payout ratio for FY17.

Looking ahead, we believe competition within the mobile segment will continue to put pressure on ARPU with the impending entry of TPG as well as the announced intention of MyRepublic to launch mobile services as a Mobile Virtual Network Operator (MVNO). While M1 has recently launched nationwide NB-IoT network, it expects mass adoption to take time as a new technology and with the eco-system still evolving.

Separately, we do not expect M1’s ICT business to contribute materially in the near-term as it needs time to ramp up as well.

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Supported by 6.8% Forward Dividend Yield

With a set of in-line 9M17 results, we keep our forecasts unchanged and note the lack of any near-term catalysts driving earnings. Hence, we maintain our HOLD rating and the same FV of S$1.65.

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SPH REIT Share Investment update

1. 4QFY17 DPU +0.7% YoY
2. FY17 portfolio rental reversion of 1.2%
3. Full committed occupancy

4QFY17 Results Within Expectations

SPH REIT reported an in-line set of 4QFY17 results, with gross revenue and NPI growing by 1.3% and 3.9% YoY to S$52.9m and S$41.8m, respectively. This was driven by higher rental income from both Paragon and The Clementi Mall (TCM), coupled with higher NPI margins (+2 ppt YoY to 79.0%) due to proactive management of utility contracts, lower property tax and maintenance expenses.

DPU for the quarter came in at 1.42 S cents, representing YoY growth of 0.7% as management released S$4.5m of taxable income available for distribution retained in 9MFY17, versus S$1.6m released in 4QFY16.

For its full-year performance, SPH REIT reported a 1.5% increase in gross revenue to S$212.8m and a 4.5% jump in NPI to S$168.1m. The latter formed 101.5% of our FY17 forecast. DPU of 5.53 S cents translated into growth of 0.5% and constituted 99.0% of our FY17 projection.

Negative Rental Reversion for Paragon a Surprise

Both Paragon and TCM maintained their 100% committed occupancy, as at end-FY17. However, a downside surprise came from Paragon’s negative rental reversion figure of 0.8% for expiries in FY17. As rental reversions for the mall were positive in 9MFY17 at 3.6%, this implies a weak 4QFY17 showing.

The softness came largely from the retail space, as reversions for the office/medical leases were flat. TCM fared better, with positive rental uplifts of 3.7% for the full-year, thus resulting in an overall portfolio rental reversion of 1.2% in FY17. Shopper traffic for both malls was stable.

While Paragon achieved higher tenant sales of 2.1% in FY17, TCM saw a 5.8% decline. Nevertheless, the occupancy cost for Paragon (19.6%; unchanged) and TCM (15.8%; +0.8 ppt) remains healthy, in our view.

There were also positives from SPH REIT’s portfolio valuation, underpinned by a compression in cap rates adopted by the valuers, as rental assumptions held steady. Paragon’s valuation rose 1.5% to S$2,695m, while that of TCM inched up 1.6% to S$583m.

Maintain BUY

Taking into account this full-set of results, we trim our FY18 and FY19 DPU forecasts by 1.1% and 1.8%, respectively. But as we also roll forward our valuations, our DDM-derived fair value estimate remains unchanged at S$1.08. Maintain BUY.

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Stock Market analysis of City Developments Limited

• Price translates to S$1,515 psf ppr
• FV increases to S$12.90
• Maintain BUY

Acquires Amber Park for S$906.7m Via Collective Sale

 

An 80:20 JV between City Developments (CDL) and Hong Leong group has successfully tendered S$906.7m for the collective sale of Amber Park. The 200-unit development at Amber Garden is one of the largest sites in the locality with a land area of 213,675 square feet. With a plot ratio of 2.8, the allowable GFA of the project is 598,290 sq ft. Development charges are not payable for the proposed development. This translates to a price of S$1,515 per square foot per plot ratio, which we believe is a reasonable price given a competitive land market currently.

We expect sale prices of between S$2.3k – S$2.4k when the new project is launched. Subject to approval, the JV plans to redevelop the site into a condominium project comprising four 25-storey blocks with close to 800 units and a basement carpark. Most apartments will have a NorthSouth orientation with many units commanding sea views. We note that CDL was also the original developer of Amber Park three decades ago, and management has indicated that they are intimately familiar with the location.

Near New Tanjong Katong MRT Station to be Completed in 2023

The site is located in a private residential area in the Katong and East Coast area and is accessible via the East Coast Parkway. It is also within 1km to Tanjong Katong Primary School and 2km to CHIJ (Katong) Primary, Haig Girl’s School, Kong Hwa School and Tao Nan School. The new Tanjong Katong MRT station will also be located 200m from the site when it is completed in 2023. W

e update our model for the site acquisition and firmer residential ASP assumptions, given recovering home prices and stronger market conditions, and our fair value estimate increases from S$12.39 to S$12.90. Maintain BUY.

 

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Market Update: Singapore stocks log best week in nine months, Malaysian shares rise

Singapore shares posted their best weekly advance since January, helped by a rally in property developers and lenders, while Malaysian equities also rose over the last five days to snap a two-week losing run.

Singapore's FTSE Straits Times index rose 0.9% to 3,291.29 on Friday, taking its rally this week to 2.2%. UOL Group added 5.3% since last Friday, pacing gains for real estate developers. DBS Group Holdings led banking stocks higher, climbing 3.2% this week. On Friday, UOL Group was up 4.3% and DBS by 0.8%.

Property Singapore stocks in the city-state gained this week after City Developments bought a residential site worth more than S$900 million ($660 million), reigniting optimism for Singapore's real estate market, according to at least two brokerages. Shares of City Developments rose 2.3% this week.

Lenders climbed for a third consecutive week, tracking a rise in U.S. bond yields amid optimism over tax reforms in the world's largest economy. Singapore rates are heavily influenced by the U.S. and a rising interest rate scenario helps the net interest rate margin outlook for banks. The benchmark 10-year U.S. bond yield is trading near a four-month high.

Gains in Singapore stocks this week were also helped by a record run on Wall Street that saw all three major U.S. equity benchmarks repeatedly scale record highs.

The FTSE Bursa Malaysia KLCI ended up 0.3% to 1,764 on Friday, rising 0.5% this week. AMMB Holdings and RHB Bank were the week's top performers, adding at least 2.4% each, rebounding from last week's losses. On Friday, AMMB rose 0.2% and RHB ended little changed.

The market is expected to trade sideways in the coming week as investors await fresh catalysts which include Malaysia's upcoming 2018 fiscal budget, said Pong Teng Siew, head of research at Inter-Pacific Securities in Kuala Lumpur. "It looks like it's going to be a very quiet week ahead," with funds seen holding back positioning ahead of the budget announcement expected in the final week of this month, said Pong. His forecast model indicates a "very narrow" 14-point upside and downside for the KLCI for the whole week.

Foreign outflows from Malaysia's stock market dwindled to 29 million ringgit ($6.8 million) this week through Thursday, after last week's outflow of nearly 1 billion ringgit.

Construction and property developer WCT Holdings advanced 2.3% on Friday after is subsidiary won a contract for completion of Light Rail Transit Line 3 (LRT3) and other associated works for 640 million ringgit.

Gabungan AQRS climbed 6.4% after securing LRT3 contract worth 1.21 billion ringgit.

Source - nikkei.com

Singapore REITs Performance

Singapore’s manufacturing and electronics Purchasing Managers’ Index (PMI) continued their robust momentum, coming in at 52.0 and 53.6 for the month of Sep, representing MoM increases of 0.2 and 0.4 points, respectively. 

 

 

This also represented the 13th and 14th consecutive month of expansion, respectively.

 

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Similarly, we saw last week another month of strong industrial production in Singapore for Aug, with YoY growth of 19.1% registered. This was higher than the street’s expectations for an increase of 16.0%. This trend has also been observed in the Eurozone, with the manufacturing PMI of 58.1 in Sep at the highest level since Feb 2011.

We believe these data points augur well for the sentiment of industrial REITs, although this would be partly offset by continued supply pressures in Singapore in the near-term which would weigh on rental reversion figures.

We like Suggest Frasers Logistics & Industrial Trust [BUY; FV: S$1.22] and Mapletree Logistics Trust [BUY; FV: S$1.35] within the industrial REITs space.

Singapore Penny Stocks To Watch

1. FALCON ENERGY
2. TAT HONG
3. JAPFA
4. CHINA AVIATION
5. FRENCKEN

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Recent Stock Recommendations

SGX:Buy TAT HONG || Level 0.480|| Cut Profit @ 0.515 || Return 7.29%

KLSE:Buy PALETTE || Level 0.300 || Cut Profit @ 0.370 || Return 23.33%

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Singapore Stocks analysis of OUE Commercial REIT

1. Redemption of 75m CPPUs
2. Aggregate leverage to increase
3. Fair value of S$0.67

CPPU Redemption as Part of Capital Management Strategy

 

 

OUECT announced that it will be carrying out a redemption of 75m convertible perpetual preferred units (CPPUs) at the issue price of S$1 for each CPPU. The issuance of these CPPUs to OUECT’s sponsor was for partial payment of the purchase consideration for OUECT’s stake in One Raffles Place. Following the redemption on 2 Nov 2017, 475m CPPUs will remain outstanding. The Manager notes that this move is part of its proactive capital management strategy and to mitigate dilution in DPU from potential conversion of CPPUs into units of OUECT in the future.

Higher Finance Costs Expected

We note that the CPPUs were issued at a coupon of 1.0% p.a. in 2015, at a conversion price of S$0.841 per unit with a restricted period of 4 years from the date of issuance. While CPPU distributions will drop, OUECT’s finance costs should creep up, given that the redemption will be largely funded by existing loan facilities.

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OUECT’s pro-forma aggregate leverage as of 30 Jun 2017 is expected to increase from 36.4% to ~38.7%. On balance, we expect DPUs to soften slightly by 0.2% and 0.8% in FY17 and FY18 against our last forecast, respectively. We also believe it is possible for more CPPUs to be redeemed ahead of the non-call period in 2019, though a full redemption of the outstanding 475m units is highly unlikely.

Maintain HOLD

We believe that the Investment Outlook 2017 for the office sector is improving, as demonstrated by the flat QoQ Grade A CBD Core monthly rents of S$8.95 in Q2’17, according to CBRE. The same sentiment can also be observed from CapitaLand Commercial Trust’s recent acquisition of Asia Square Tower 2 (excluding the hotel component), where the potential benefits from an expected uptick in Grade A office rents has been cited as one of the reasons for the transaction.

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We will be waiting for further evidence to corroborate our view as we head into the earnings season. For now, based on our revised DPU forecasts, we maintain our HOLD rating but with a slightly lower fair value estimate of S$0.67 (previously S$0.68).

More update:  Stocks To Watch, 2017 Stock Market Outlook & Stock Market Investing Outloot

Singapore Stock market Analysis fo Delfi Ltd

• Indonesia cuts key rate again
• Stable 2H sales expected vs. 1H
• Investments for the long term

Soft Consumption for Key Market Indonesia

 

Delfi Ltd’s key markets have been Indonesia and Philippines, with Indonesia typically accounting for about 70% of overall revenue. As of 1H17, Delfi saw lower sales in Indonesia YoY amid the weak retail sales environment and its own product rationalization exercise to focus on core brands. Last Friday, Indonesia’s central bank cut its interest rate for the second consecutive month, against the backdrop of soft domestic consumption growth. Overall, management expects operating environment to remain challenging amid uncertain economic conditions in its key markets.

Read more -HOW AFFECTED SINGAPORE AIRLINES SHARE PRICE

Bright Spots

Management has been making efforts to improve the quality of earnings. The product rationalization programme is an example, whereby the group had eliminated lower performing SKUs, with the bulk of elimination made in late FY16, so that they could focus on growing sales of their core brands. Particularly, in the last two months of 2Q17, sales for Own Brands products saw a double digit growth in Indonesia.

In addition, the group has been able to maintain a healthy level of gross profit margin at around 30%, with 1H17 at ~33% vs. a threeyear average of ~32%, backed by initiatives such as pricing and right-sizing adjustments, as well as pushing for higher sales of premium products.

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But High Expenditures

With continuous investments being made in various aspects of the business such as brand building, capacity, distribution capabilities and supply chain integration, realizing benefits from these investments would be pertinent to sustaining growth for the long term. However, costs would likely remain high.

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On the expectation of stable sales in 2H vs. 1H, FY17 revenue would still be lower YoY, and with higher expenditure, management has also guided for lower profitability this year.

Notably, the group was in a net cash position of US$23.5m as of 30 Jun-17, and has paid 3.01 S-cents/share of dividends YTD. They have also formed strategic initiatives with Japan’s Yuraku Confectionery and South Korea’s Orion Corporation. With that said, due to an internal reallocation of resources, we are ceasing coverage on the stock..

More update:  Stocks To Watch, 2017 Stock Market Outlook, Stock Market Investing Outlook & Investment Outlook 2017

Singapore Stocks Market Analysis of ComfortDelGro Corp

ComfortDelGro Corp - Downgrade: A rail disappointment

 
■ Regulator awards TEL contract to SMRT despite poorer track record
■ We see greater uncertainty over the outcome of future contracts
■ Downgrading to Hold (3) from Buy (1); lowering TP to SGD2.09

What's new:

The recent award of the Thomson-East Coast Line (TEL) rail contract to SMRT (not listed) raises uncertainty over the regulator’s evaluation process for future transport service contracts, in our view. As our original expectation for ComfortDelGro (CDG) to be a key beneficiary of greater public transport usage in Singapore appears diminished, we downgrade our rating on the stock to Hold (3) from Buy (1).

 

What's the impact:

The TEL contract was widely expected to be a key near-term catalyst for CDG. While we had not factored its potential into our forecasts, we estimate that the rail line could have contributed around SGD0.08/share to our valuation. According to the regulator, SMRT’s bid of SGD1.7bn was 30% below that of CDG while still ranking higher on quality – despite CDG’s relatively better rail reliability track record. More importantly, the outcome of the bid raises uncertainty over the bidding and evaluation process for future contracts in both the bus and rail segments.

 
In the rail segment, CDG remains in negotiations with the regulator over the transitioning of its existing lines to a new rail model (see our note dated 20 July 2016), which we think could now lead to a less favourable resolution. Meanwhile, as bus packages currently operated by CDG are to beprogressively tendered out over the next decade, we see elevated risks
that bids may have to be priced more competitively for CDG to retain them.
Finally, while we have been aware of competitive pressures, we nowexpect CDG’s taxi business to see a structural longer-term decline. In terms of forecast changes, we cut our near and longer-term growth and margin expectations for CDG’s Singapore businesses across its segments, resulting in 4-13% cuts to our 2017-19 EPS forecasts. 

 

We now look for a structural decline in CDG’s taxi business over a 10-year horizon, as well as reduced profitability outlook for bus and rail. We also factor potential fare reductions into our 2018-19 rail forecasts following the regulator’s recent fare review exercise.

 

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Singapore Stocks to Watch

Here are a few Singapore Stocks that could move the market this Monday morning:

Mandarin Oriental says it has gotten recommendations from potential buyers to gain the gathering’s The Excelsior inn in Hong Kong. In a recording to SGX post-retail close on Friday. Offers in Mandarin Oriental surged 20.8%, or 44 US pennies higher, to close at US$2.56.

Roxy-Pacific announced that its partner organization, RH Guillemard, has consented to obtain freehold private locales at 12 and 14 Guillemard Lane for $22.5 million. Offers in Roxy-Pacific shut 1 pennies higher at 53 pennies on Friday.

Pavillon Holdings is getting units in a business complex and land in JB for RM52 million ($16.7 million). Offers in Pavillon shut 0.1 penny higher at 4.9 pennies.

BlackGold Natural Resources on Friday went into a Heads of Agreement (HOA) with different gatherings to shape another consortium for the improvement, development, operation, and upkeep of a 2 x 300MW coal-terminated power plant in Riau, Indonesia. Offers in BlackGold last exchanged at 11 pennies on Friday.

Singapore Airlines Group’s traveler stack factor (PLF) enhanced by 1.2 rate focuses to 80.9% in August. Offers in SIA shut 5 pennies bring down at $10.13 on Friday, up 4.8% year to date.

Lian Beng Construction (1988), a completely possessed auxiliary of Lian Beng Group, has been granted an agreement worth around $162 million to build an apartment suite lodging improvement at Martin Place. Offers in Lian Beng shut 1 penny higher at 62 pennies on Friday.

ICP is obtaining the land, building, and friends of Geo Hotel in Kuala Lumpur for a sum of $27.5 million to rebrand it into a Travelodge Inn. Offers in ICP shut down at 0.8 penny on Friday.

Low Keng Huat, the development organization, and engineer, detailed 2Q17 profit fell 99% to $474,000 from $43.1 million a year back because of an exceptional pickup of $53.8 million from the offer of Duxton Hotel Saigon in 2Q16. Income rose 59% to $13.6 million. Offers in Low Keng Huat shut down at 66 pennies on Friday.

Heatec Jietong, the warmth exchanger, and channeling authority, secured three contracts under its warmth exchanger business fragment with a joined worth of $4 million. Offers in Heatec Jietong shut down at 6.5 pennies on Friday.

Global Stocks Markets

Markets in US shut at record levels on Friday.The & Dow rose 64.86 focuses to close at 22,2686.34, a record. The&; S&P 500 also indented record highs, progressing 0.2% to complete at 2,500.23. The& ;Nasdaq composite shut 0.3% higher at 6,448.47.

Singapore Stocks Market

The offering of the three banks brought about the Straits Times Index completing 11.39 focuses bring down at 3,209.56 on Friday. Two billion units of exchanges esteemed at $1.7 billion were finished. Barring warrants, there were 174 ascents versus 212 falls.

Singapore Penny Stock To Buy

• Blumont
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• YZJ Shipbldg SGD
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Singapore Stock Market Leading now positively in Asia Economy

The Singapore securities exchange ricocheted higher again on Friday, one session after it had finished the three-day winning streak in which it had gathered right around 65 focuses or 2 percent. The Straits Times Index stays just underneath the 3,230-point level and it called higher again on Monday.

 
The worldwide conjecture for the Asian markets is extensively positive because of cheery U.S. work information and French decision comes about. The European and U.S. markets were up on Friday and the Asian bourses are relied upon to take action accordingly.

The STI completed scarcely higher on Friday taking after blended exhibitions from the financials, properties and industrials. 

Singapore Stock Market

Among the actives, SembCorp Marine plunged 2.79 percent, while Golden Agri-Resources dropped 1.37 percent, City Developments slipped 1.29 percent, Thai Beverage climbed 1.11 percent, SembCorp hopped 0.95 percent, Yangzijiang Shipbuilding progressed 0.81 percent, Oversea-Chinese Banking Corporation gathered 0.59 percent, DBS Group facilitated 0.15 percent and Noble Group was unaltered.

The lead from Wall Street is firm as stocks moved higher on Friday, pushing the NASDAQ and the S&P 500 to new record shutting highs. 

Global Share Market
 

The NASDAQ included 25.42 focuses or 0.4 percent to 6,100.76, while the S&P was up 9.77 focuses or 0.41 percent to 2,399.29 and the Dow included 55.47 focuses or 0.26 percent to 21,006.94. For the week, the Dow included 0.3 percent, the NASDAQ was up 0.9 percent and the S&P increased 0.6 percent. 



Read more - SINGAPORE STOCK MARKET 2017 OUTLOOK & STOCK PICKS TO CONSIDER
 
The firm close took after the Labor Department's month to month employments report, which indicated more grounded than anticipated occupation development in April. The information fortified desires of another loan fee climb by the Federal Reserve one month from now.

Merchants were hesitant to make enormous pushes forward of the end of the week's presidential spillover in France - yet anti-extremist hopeful Emmanuel Macron has been anticipated as the victor, likely powering the business sectors. Macron soundly vanquished far-right applicant Marine Le Pen to end up, at 39, the nation's most youthful president. 


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Crude Oil petroleum fates steadied Friday in the wake of diving to their most reduced of the year. WTI light sweet unrefined petroleum was up 60 pennies at $46.12 a barrel, having dipped under $45 before in the session.

We would like share us Singapore movable stock of the day:

• CHASEN
• BEST WORLD 
• JADASON
• NOBLE 
• YUUZOO

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Today's SGX/KLSE Hot Stocks Update .

Here is Today's SGX Hot Stocks List of Singapore  :

• REX INTL.SG
• TT INTL.SG
• NOBLE.SG 

Here is Today's KLSE Hot Stocks List of Malaysia  :

• CSCSTEL.KL
• COMCORP.KL
• BIMB.KL
  
  

These rundown Are more gainful for Contra exchanging and Intra Trading . So I Wish all of you the best.

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Daily Hot Stock List of Singapore

Today in Singapore Stock Market Below Stocks are In Focus:

• Semb Corp Marine
• Inovalues
• Noble
• Eezion

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