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Accordia Golf Trust Will the game change? ■ We visited six of AGT’s golf courses in Tokyo over the weekend. ■ Bloomberg consensus puts forward dividend yield at 9.0% and forward P/BV at 0.78x. ■ Post MBK’s acquisition of sponsor, Accordia Golf, management will seek a meeting with MBK to understand the strategy going forward. Status quo for the moment. ■ Dividends are derived in yen and paid in Singapore dollars. The company does not hedge the exchange rate.
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Raffles Medical Group: New hospital in Chongqing strategically located Targeted for completion by 2Q18, we believe Raffles Medical Group’s 700-bed hospital in the New North District of Liangjiang New Area in Chongqing would be one of the early movers to ride on the area’s rapid economic growth and increased connectivity. We see this hospital as a likely beneficiary of a significant addressable patient population, including upper-middle income local patients from across China, expatriate as well as international patients, with the latter potentially spanning from central Asia, Russia and Europe. We are positive on this new development in China for the long run, which is further backed by a team experienced with the region. For now, we keep our estimates unchanged. Maintain BUY and S$1.60 FV. |
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MAYBANK KIM ENG |
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M1 (M1 SP) Post-GSA, Cut TP 5%/DPS 38% Maintain SELL, TP lowered to SGD1.75 The IMDA has concluded Phase 1 of the General Spectrum Auction (GSA) after three days of auctions. Excess demand for 50MHz from the incumbent telcos and newcomer TPG (TPG AU, Not Rated) led to frenzied bidding for the 175MHz of spectrum available and a final price premium of 560% per lot for the non-reserved 900Mhz spectrum, 370% for 700MHz and 297% for 2.5GHz. To pay for higher-than-expected spectrum cost, M1 needs to lower FY18-19E dividends by 38% to keep gearing levels below the estimated comfort level of 1.8x net debt/EBITDA, with the result that yields will become a pedestrian 3.2% by FY19E. We lower DCF-TP by 5% to SGD1.75 (WACC 5.5%, LTG 0%). Maintain SELL.
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Hong Leong Finance Earnings recovery amidst M&A potential Initiate coverage with BUY rating, S$3.20 TP; new opportunities abound, M&A a possibility Solid >50-year track record in property-related financing and SME lending; untapped and unbanked niche financier Expect 44% growth in NPAT in FY2017 due to NIM expansion Attractive M&A target for acquirers looking to expand reach in Singapore SME lending space Trading below book value and >30% discount to banks; TP of S$3.20 offers 18% upside; an additional minimum 43% upside in the event of an M&A over last close
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Check out our compilation of Target Prices
