| DBS VICKERS | OCBC |
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Delaying results announcement by several hours to the morning of 23 February Hint that it will be releasing outcome of its Strategic Review alongside results? Hopeful of a meaningful review Reiterate BUY; TP S$4.50
What’s New Sembcorp Industries made an announcement to inform the market that it is delaying the release of its FY17 results by several hours from 22 February (after market close) to 23 Feb (before market open). The analyst briefing is thus postponed from the evening of 22 to the morning of 23at 11am. While there is no clarity on the announcement of the outcome of its Strategic Review, which Sembcorp has said will be done by 1Q18, we wonder if the reason for the delay could be that Sembcorp is combining the announcement of results and the outcome of the review outcome.
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Far East Hospitality Trust: Bow Wow Wow
Far East Hospitality Trust's (FEHT) results were within expectations. Altogether, FY17 revenue was down 4.8% YoY to S$103.8m while DPU ended 9.9% down YoY at 3.90 S cents or 98% of our full-year forecast. Management indicated that its Orchard assets and Oasia Hotel Novena found the entry of the nearby hotels in 4Q17 challenging. We believe poorer operating performance from these assets pulled down the positive RevPAR trend for the rest of the hotel portfolio. We continue to see 2018 as a period of recovery from this low base, though we tweak our RevPAR growth rates for FY18 downward. For the serviced residences, we believe 1Q18 should see a marked improvement YoY – recall that FEHT’s SR suffered a 13.1 ppt drop in occupancy to 71.2% in 1Q17. After adjustments, our fair value decreases from S$0.77 to S$0.75. As at 15 Feb’s close, FEHT is trading at a FY17 yield of 5.5% (actual) and a FY18F yield of 6.2% (our forecasts). Maintain BUY. |
| UOB KAYHIAN | PHILLIP SECURITIES |
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Banking – Singapore 4Q17 Round-up: Dividends Aplenty
Banks provided a generous serving of final and special dividends after Basel III reforms were finalised in Dec 17. Banks have guided for loan growth of high singledigits and we expect NIM expansion to continue into 2018. Maintain OVERWEIGHT. OCBC is our preferred BUY (Target: S$14.90) due to IPO of Great Eastern (Malaysia) in 2H18. However, DBS could provide more short-term momentum in the run-up to the next FOMC meeting on 20-21 March (Target: S$30.40).
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CapitaLand Limited A year of active portfolio re-constitution
SINGAPORE | REAL ESTATE | FY17 RESULTS 20% dividend hike to 12c/share for FY17. Replenishing of land bank in Singapore with en bloc purchase of Pearl Bank. Lower residential sales value in China partially offset by higher sales in Vietnam. Active portfolio reconstitution with realised divestment gains tripled YoY at S$318mn. Maintain Accumulate with unchanged TP of S$4.19.
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PHILLIP SECURITIES |
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Chip Eng Seng Corporation Ltd Strong revenue visibility in FY18
SINGAPORE | REAL ESTATE | FY17 RESULTS 39% yoy jump in contributions from property development segment. Improved occupancies at Singapore and Maldives hotels. Timely replenishing of construction order book with S$168mn design and build contract from HDB. Maintain Buy with unchanged STOP-derived TP of S$1.21 (40% discount to RNAV).
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