CNMC Goldmine Holdings Limited
A respite in the bull run
9M16 Revenue met 65.8% of our full year expectation of US$44.8mn
Operating income met 62.2% of our full year expectations of US$21.9mn
Net income met 64.8% of our full year expectation of US$21.1mn
We revise down our FY16e revenue from US$44.8mn to US$42.1mn while maintaining FY17e and FY18e unchanged. We maintain our “Buy” rating with a reduced discounted FCFE-derived TP of S$1.01 (from S$1.03). Cost of equity used remains unchanged at 9.8%. Our TP implies a 96% return from the last close price of S$0.515.
Scoring a hat trick in cinemas
■ mm2 proposed acquisition of 13 Lotus Fivestar cinemas in Malaysia, expanding its market share to top four in Malaysia.
>■ Deal comes with 2-year EBITDA target of S$3.3m and option for more cinema purchases and collaboration.
■ Purchase price cheaper than previous acquisitions of Mega and Cathay.
■ Earnings-accretive acquisition raises our FY18-19F EPS by 4-7%.
■ Deal an overall positive given the greater synergies and diversification. Maintain Add, with higher target price of S$0.52 (based on 22x CY18F P/E, peer average).
Global Logistic Properties Ltd: Fund management strategy showing results
Chinese outlook appears firm
Strong execution on fund platform
Earnings broadly within expectations
GLP reported that its 2QFY17 PATMI increased 52% to US$173m mainly due to increased contributions from the group’s fund management platform. Specifically, we understand that fund fees over the quarter rose 25% YoY to US$47m, comprising US$31m of asset and property management fees and US$16m of development fees. On a core basis (adjusting for non-recurring items and revaluations), the group’s core earnings in 2QFY17 were 53% higher YoY at US$68m. In terms of the topline, GLP’s revenues over the quarter also increased 13% YoY to US$214m mostly because of the completion and stabilization of the group’s Chinese projects with higher rents, higher management fee income, and the appreciation of the JPY, partially offset by the weaker RMB and rent adjustments in China due to the transition of business tax to a VAT regime. Overall, we judge this quarter’s performance to be broadly in line with expectations. Maintain BUY with an unchanged fair value estimate of S$2.37.
|UOB KAYHIAN||DBS VICKERS|
STRATEGY – SINGAPORE Riding The M&A Wave
M&A continues to be in play after the spate of privatisation. Other than privatisation candidates, we highlight companies with potential accretive acquisitions that could pique investors’ interest. WHAT’S NEW • M&A theme continues to be in play. The recent spate of M&As, including the latest privatisation of ARA Asset Management, conditional general offer for Super Group and the acquisition of Innovalues via a scheme of arrangement, indicates the M&A theme is still playing out. This report highlights our stock picks to ride on the M&A theme.
Singapore Office REITs
Bullish signal from developers
Central Boulevard office sold on implied price in excess of S$3,000 per square foot on a gross development basis
Signals confidence on outlook for the Singapore office market
Singapore office REITs undervalued given high land prices and construction costs
Top pick – Keppel REIT (BUY, S$1.23 TP)
Check out our compilation of