| CIMB | UOB KAYHIAN |
|
Multi-Chem Limited Stopping hackers in their tracks ■ Multi-Chem Limited (MC) used to be a printed circuit board (PCB) drilling service provider. Today, MC has successfully diversified into the IT distribution business. ■ Its IT business carries best-of-breed IT security products and MC is also involved in training for such products. ■ We note that the company has been in a net cash position over the past five years and has also rewarded shareholders with dividends. ■ MC trades at historical FY15A P/E of 11.0x. Historical dividend yield was 5.66%.
|
Oil and Gas – Singapore The Beginning Of The End Of Low Oil Prices? OPEC has announced a deal that will see their production reduced by 1.2mbpd, effective Jan 17. The deal sets the stage for the oil market to reach an earlier balance in 2017. We expect the sector to remain a trading play, as we expect continued oil price volatility from factors that may cap or break current price levels. We re-run our P/B to Brent crude price regression and update valuations accordingly. Upgrade to MARKET WEIGHT.
|
| OCBC | |
|
Global Logistic Properties Ltd: Reviewing strategic options GLP announced that it is undertaking an independent strategic review of options to enhance shareholder value, after it has received a request from its largest shareholder, GIC Real Estate Private Ltd. The group has appointed JP Morgan as a financial advisor to assist on the strategic review and has also set up a special committee, comprising four independent directors, to oversee the strategic review. We understand that the group, through JP Morgan, is in the process of making preliminary approaches to various parties to evaluate the viability of options for its business. Management emphasized that no definite transaction has been entered into with any party. Overall, we see this as a positive development that underscores the fact that the GLP's share price has been persistently undervalued but caution against speculating on a near-term sale of the company, which is uncertain. We continue to see significant long term fundamental value in the group's shares at current prices, given its business portfolio and leading positions in its key markets, and maintain our BUY rating with a fair value estimate of S$2.37. |
|
| PHILLIP SECURITIES | DBS VICKERS |
|
Cache Logistics Trust Refinances Loan Facility Entered into a term loan facility to refinance and repay borrowings No refinancing requirement until 2H 2018 Extended weighted average debt maturity and lowered all-in financing costs Upgrading our rating to "Neutral" on valuation grounds What is the news? Cache has entered into a facility agreement of a five-year, S$90.0mn unsecured term loan facility. The S$90.0mn will be used to: (1) refinance an existing S$97.0mn 3.5-year secured term loan facility, of which S$73.0mn has been drawn to date, (2) repayment of an existing S$12.0mn drawn from revolving credit facilities of S$65.0mn and (3) other working capital requirements.
|
Sembcorp Industries Riding on oil recovery BUY SCI; TP lifted to S$3.10, after imputing higher valuation for SMM (from S$1.15 to S$1.55). The risk premium for O&M players should be reduced with the brighter oil outlook following OPEC’s agreement to cut production. Sembcorp Industries (SCI) offers the best risk reward among the three O&M large caps, trading at an undemanding 0.7x P/BV, implying a next-to-zero valuation for SMM. Our TP translates to 0.9x P/BV, which is c.20% below the trough levels seen during the Global Financial Crisis and Asian Financial Crisis. We believe this is fair in view of its 6% ROE and 3% dividend yield. Reiterate BUY on SCI.
|
Check out our compilation of Target Prices
