| PHILLIP SECURITIES | MAYBANK KIM ENG |
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CapitaLand Commercial Trust Driven by CapitaGreen acquisition CapitaGreen acquisition boosted gross revenue by 9.6% (Without acquisition: -1.2%) Minimal occupancy risk in FY17. But FY18 could be worse than FY16 and FY17 for rental reversions. Golden Shoe Car Park (GSCP) re-development commencement expected in 2H17. Estimated completion of GSCP could clash with potential release of 1m sq ft of competition office space. Net office demand likely to have bottomed in 2016. Upgrade to NEUTRAL with a higher target price of $1.63.
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Bumitama Agri (BAL SP) The worst is likely over BUY for its decent valuation and growth recovery After three consecutive quarters of YoY decline, BAL finally posted its first quarterly yield recovery for 4Q16, a sign that the worst is likely over. Its better-than-expected 4Q16 yield recovery will lift our 2016 earnings estimate. BAL’s 2016 core PATMI will likely beat our forecasts by +16%, but fall within consensus estimates. At ~11x FY17 PER, it current trades at -2SD of its historical mean. BUY with a TP of SGD0.97 based on 14x 2017 PER (pegged at -1SD of 4-year historical mean).
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| CIMB | |
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Japfa Ltd Capitalising on Asia’s growing consumption ■ We initiate coverage on Japfa with an Add rating and SOP-based TP of S$1.53 (implied 11.6x CY17F P/E), representing 66% upside potential over current price. ■ Japfa is among the top two industrial agri-food companies in most of its markets and its profitability has improved following a recovery in selling prices over the past year. ■ On a macro level, we like Japfa as a long-term play on emerging markets’ GDP growth and rising middle class population. ■ We forecast 27% EPS CAGR over FY15-18F, driven by its 1) stable feed business, 2) now profitable breeding and farming segments, and 3) strong dairy operations. ■ Upside earnings surprise could come from the dairy segment.
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| OCBC | UOB KAYHIAN |
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Keppel DC REIT: Reiterate BUY with higher FV Keppel DC REIT’s (KDCREIT) 4Q16 results met our expectations. Gross revenue grew 8.4% YoY to S$26.8m, but DPU dipped 20.1% to 1.31 S cents largely due to an enlarged unit base arising from KDCREIT’s pro-rata preferential offering exercise in Oct last year, while contribution from Keppel DC Singapore 3 (KDC SGP 3), which is to be funded by proceeds from the preferential offering exercise, has yet to kick in. Completion of the acquisition was only completed on 20 Jan this year. Excluding this impact, adjusted DPU would have increased 1.8% YoY to 1.67 S cents. KDCREIT’s occupancy stood at 94.4%, as at 31 Dec 2016, up 1.7% QoQ. Portfolio WALE (by NLA) remains healthy at 9.6 years. 83% of its borrowing costs have been hedged, while its foreignsourced distribution up to 1H18 has also been hedged. We maintain BUY on KDCREIT with a higher fair value of S$1.39 (previously S$1.35), as we roll forward our valuations and update our FX and cost of equity assumptions. |
KEPPEL INFRASTRUCTURE TRUST (KIT SP) 4Q16: Results Remain In Line; Prepped For Acquisitions in 2017 RESULTS • 4Q16 results in-line. Keppel Infrastructure Trust (KIT) reported distributable cash flows of S$41.8m for 4Q16. For FY16 this was S$149.5m, and made up 97% of our full-year estimate |
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