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HRnetGroup Ltd (HRNET SP)
Positioned for Region’s Growth
In the world’s largest labour market HRnetGroup (HRnet) is one of the largest Asia Pacific-based recruitment companies outside Japan operating in 10 cities and serving over 2,000 clients across eight industry segments. Independent research firm Frost & Sullivan estimates the APAC region will be the largest labour market in the world and amongst the fastest growing too with recruitment industry revenues forecast to grow at 9.4% CAGR in 2016-2021.
Adding work in Brazilian yard
■ YTD orders touched c.S$270m as SMM announced a US$145m hull carry over works contract from Tupi B.V. for the FPSO P-68 project.
■ The hull is an addition to the current contract that SMM secured in 2012 from Petrobras for the construction and integration of FPSO P-68.
■ We are keeping our S$1.5bn order wins target, hoping to hear of more offshore conversion/Gravifloat contracts.
■ Maintain Add and target price, still based on 1.5x FY17F P/BV, the average trading band in 1996-2003, a period of weak oil prices and pre-rig boom.
■ Contract wins and divesting of delayed rigs could be a key catalyst.
Banyan Tree Holdings (BTH SP)
Sunny Turnaround Just Ahead
A global hospitality giant and born-and-bred Singapore brand, BT is executing a comprehensive strategy for a sunny turnaround. We believe the Accor and Vanke deals as well as its own internal improvements will bring about revenue growth, improved margins and a healthy balance sheet. This puts the BT turnaround story firmly in place with 35.4% 2016-19 EBITDA CAGR and deep book value. Initiate coverage with BUY and SOTP-based target price of S$0.93.
Cache Logistics Trust: Trading at 7.7% FY18F yield
The ex-rights trading for Cache Logistics Trust’s (CACHE)
rights issue began last Fri and our ex-rights fair value estimate is S$0.78. Our fair
value in turn implies an intrinsic value of S$0.148 for the rights entitlements, given the rights issue price of S$0.632 per unit. The
Remedy for en-bloc fever?
• Sharp 13.8% hike in DC rates for non-landed residential developments could further reduce profitability by 1-4% for recent en-bloc transactions
• Larger en-bloc sites such as Serangoon Ville, Eunosville and Rio Casa could launch early to mitigate potential risks of ABSD and QC charges in the future
• Moderates en bloc momentum
• Picks UOL and City Dev
Check out our compilation of Target Prices