■ We initiate Yongnam with an Add and TP of S$0.53, based on 0.8x FY18 P/BV (10% discount to long-term average). Contract wins are the key catalysts for the stock.
■ Using existing capacity, Yongnam aims to tender for S$1.16bn worth of projects for 2017-18 award. This includes c.S$500m of struts projects for North-South Corridor.
■ As a steel provider for Singapore’s iconic projects, Yongnam sits on 208k tonnes of struts and steel plate assets worth S$242m (S$0.46/share) at end-FY16.
■ Yongnam is trading at 5x FY19 P/E and 0.5x FY18 P/BV, below its long-term average of 6x forward P/E and 0.9x P/BV.
■ Based on the projects in tender and a 50% hit rate, losses in FY17 could be reversed in FY18F to a net profit of S$10m. Earnings were c. SS$47m p.a in FY08-12.
FR reported better qoq and yoy FFB nucleus production in 3Q17 on the back of a yield recovery and supported by new mature areas. We forecast core net profit of US$33m-37m for 3Q17. We expect better qoq earnings on the back of higher production and higher contribution from biodiesel sales, while yoy earnings could come in flat or marginally higher as the higher yoy production yoy would be partly offset by lower CPO ASP. Maintain HOLD. Target price: S$1.95. Entry price: S$1.75.
Frasers Centrepoint Trust: Projecting another record DPU in FY18
Sing Investments & Finance Limited
A Stellar Performance
SINGAPORE | BANKING | 3Q17 RESULTS
3Q17 PATMI of S$5.164mn exceeded our estimate by 28.6%.
The surprise came from a sharp increase in interest income and hiring charges after two quarters of decline. We raised our earnings forecast by 10%.
Allowances for bad loans declined 45.6% YoY.
Maintain “Accumulate” with a higher target price of S$1.725 (previous TP S$1.67) based on 0.8x FY18e P/BV as we roll over to FY18e valuations.
Check out our compilation of Target Prices