| CGS CIMB |
UOB KAYHIAN |
|
OCBC Digitalisation is the new normal
■ Digital transformation is a step in the right direction and OCBC is playing it safe by sticking with a tried and tested approach. ■ OCBC targets to achieve a 40% cost-to-income ratio (CIR) by 2023 once cost efficiencies from its transformation kick in. 1H18 CIR stood at 43%. ■ Maintain Add with a TP of S$14.00 based on GGM (LTG:3%, ROE:11.8%). Short-term catalyst includes higher NIMS from loan repricing.
|
Telecommunications – Singapore Second Time Lucky
Keppel and SPH are considering a potential transaction involving their respective 19.3% and 13.5% stakes in M1. A general offer for M1 shares would be triggered if both KPTT and SPH divest of their M1 shares. The potential investor could be attracted by the possible consolidation of the mobile industry from four to three players over the longer term. Upgrade M1 to BUY (Target: S$1.88). BUY StarHub as the stock would play catch-up (Target: S$1.92). Maintain OVERWEIGHT.
|
| RHB SECURITIES | OCBC SECURITIES |
|
Valuetronics Minimal Flooding Impact
Maintain BUY and DCF-based TP of SGD0.92, 33% upside. Management clarified that the flooding at its plant in China had caused minimal impact to operations. It has since resumed production of its consumer electronics products. It also guided that <10% of topline would likely be impacted by the recent USD200bn additional tariffs. We note that the recent correction has placed Valuetronics at an attractive valuation – of just 7.9x F19F P/E, accompanied by a 6.3% yield. Management would be implementing more overtime shifts to catch up on production.
|
Wheelock Properties (S) Ltd: Wake Me Up before You Go-G.O.
Regarding the voluntary unconditional general offer (GO) from Wheelock & Co (20 HK), the Offeror has announced both a final offer price (S$2.10/share) as well as a final closing date (5:30PM on 2 Oct 2018). In this report, we discuss the options available to shareholders in great depth. We continue to see the S$2.10 offer price as low relative to our fair value. At the same time, we also recognize that the GO presents a unique opportunity for some shareholders to realize a profit in a very short period of time. As such, we have a two-tiered recommendation. For shareholders who are in-the-money, we recommend accepting the offer (Option 1) to switch to other more attractive opportunities like CAPL and UOL. For shareholders who collected WPS after the current GO announcement (at more than S$2.10), we recommend waiting out for a second and better general offer (Option 2), though there are also risks associated with this. See our report appendix for more details. |
|
DBS VICKERS |
DBS VICKERS |
|
Frasers Commercial Trust (FCOT SP) : BUY Seeing is believing
• Tour of revitalised Alexandra Technopark (ATP) gives confidence in the ability of ATP to attract tenants • Enhanced amenities and refreshed environment should enhance ATP’s competitive position • Next step to take is to convert increased enquiries into new leases • Maintain BUY, TP of S$1.65
|
Keppel-KBS US REIT (KORE SP) : BUY
Maiden acquisition in Seattle • Acquires Westpark portfolio in Seattle for US$169.4m or initial NPI yield of 6.80-6.85% • Yield-accretive transaction to be funded via rights issue or preferential offering • Under rented portfolio in a rising Seattle market leveraged to the technology sector • Maintain BUY, TP of US$0.95
|
Check out our compilation of Target Prices
