ANALYSTS SAY: Buy, Sell, Hold (11 May '18)

Frencken Group (FRKN SP)

1Q18: Results In Line, Broad-based Improvements Ahead

Frencken’s 1Q18 results are in line. Despite the absence of revenue from a sold subsidiary, higher sales from Mechatronics offset reduced sales from IMS to deliver overall growth of 3.2% yoy. Stripping out 1Q17’s one-off disposal gain, attributable net profit grew 10.8% yoy. As Frencken executes its strategies amid a positive macro background, we expect broad-based improvements in 2Q18. Maintain BUY with an unchanged PE-based target price of S$0.79, implying 46.3% upside.

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Genting Singapore: EBITDA up 27% YoY!

Genting Singapore (GS) posted a strong set of quarterly results to start FY18. 1Q18 revenue increased 15% YoY to S$675.1m, supported by a 17% increase in gaming revenue and 10% increase in non-gaming revenue. 1Q18 adjusted EBITDA grew 27% YoY to S$358.9m, with a margin of 53.2% for the quarter. After making adjustments, our FCFE-based fair value remains at S$1.45. As of 10 May’s close of S$1.16, GS’s share price has corrected 17% from its peak in Jan and has an expected upside of 25% to our fair value, excluding dividends. Given the robust operational outlook, we re-iterate BUY on the stock.

Wilmar International

Weaker tropical oils a drag on 1Q18 earnings

■ Wilmar’s 1Q18 results below expectation due to lower tropical oils earnings.

■ Core net profit fell 37% yoy due to weaker performances from key divisions.

■ Tropical oils and sugar posted poorer earnings due to weaker refining margins.

■ The group said the plan to list its China operations is on track for 2H19.

■ We retain our Add call due to its attractive valuations and plan to list its China assets

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Health Management International

In the pink of health SINGAPORE | HEALTHCARE | 3Q18 RESULTS

 9M18 Revenue/Core PATMI met 73%/76% of our full year estimations

 Remains a medical tourism hotspot; 9M18 Foreign patient load +15% YoY

 Improving operating efficiencies, with higher Day Surgery cases and benefitting from its cost-saving initiatives; FY18e EBITDA margin could +2pps YoY to c.25%

 Maintain BUY with unchanged DCF-derived TP of S$0.83

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HRNetGroup Ltd

A good start Thesis: Riding on labour market recovery.

We maintain our BUY recommendation for HRnetGroup as a beneficiary of the economic and labour market improvement. The counter is currently trading at 16.5x/15.8x FY18F/19F PE. Excluding cash estimated on its balance sheet, PE (ex-cash) would be even lower at c.10.6x/10.1x our earnings estimates. The institution of the group’s co-ownership model with its IPO has seen over 400 of its employees becoming shareholders. In our view, this aids in increasing motivation and bodes well for the group.

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Hongkong Land (HKL SP)

Offices shining

 Central office vacancy fell below 1% on continued favorable rental reversion

 Office reversionary growth in Singapore to turn positive later this year

 Recent share buyback signals strong embedded value

 Maintain BUY with US$8.53

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