| UOB KAYHIAN | UOB KAYHIAN |
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Lendlease Global Commercial REIT (LREIT SP) 1HFY21: Benefitting From Recovery In Domestic Consumption
Contribution from 313@Somerset has normalised with occupancy improving 3.1ppt qoq to 98.7% in 2QFY21. 313@Somerset will benefit from increased shopper traffic from the redevelopment of the Grange Road car park site, while Sky Complex will benefit from the redevelopment of MSG into a major decentralised office district in Milan. LREIT provides an attractive distribution yield of 6.0% for FY21 and trades at a 7% discount below NAV/unit of S$0.85. Maintain BUY. Target Price: S$0.97.
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Thai Beverage (THBEV SP) 1QFY21: Solid Earnings; Awaiting A Potential Listing
THBEV announced net profit of Bt8.5b, up 0.5% yoy, above expectations. The spirits volume remained resilient while cost control measures continue to improve margins. A potential spin-off listing of the group’s beer business, ASEAN’s leading brewery by volume, looms on the horizon. It could help unlock value for THBEV. Maintain BUY with a 12% higher target price of S$0.95.
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MAYBANK KIM ENG |
PHILLIP SECURITIES |
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Far East Hospitality Trust (FEHT SP) Master Lease Cushion
Recovery slow, undemanding valuations FEHT’s operations in 2H20 continued to be cushioned by isolation demand and accommodation originating from border restrictions. Occupancies for its Singapore hotels and serviced residences (SRs) were high at 92.5% and 84.9%. RevPARs/ RevPAUs were soft but declined less than peers, while a reduction in management fees (by 23%) after a review at end-2019 saw FY20 DPU at -37% YoY (versus -60% YoY for ART and -45% YoY for CDLHT). A high proportion of minimum fixed rent from its master lease offers downside support amid a slow 2021 recovery, whilst valuation is undemanding at 0.7x P/B to our SGD0.70 DDM-based TP (COE: 5.4%, LTG: 2.0%).
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DBS Group Holdings Ltd Tenacity in adversity
SINGAPORE | BANKING | FY20 RESULTS FY20 earnings in line as lower credit costs compensated for weaker-than-expected income. NIM fell 27bps to 1.62% YoY but loan growth of 4% YoY cushioned NII. NIM further contracted 4bps to 1.49% QoQ. Fees and commissions grew 1% YoY, recovering to pre-COVID levels. Allowances matched 3Q20 levels despite the consolidation of troubled Lakshmi Vilas Bank (LVB). Upgrade to ACCUMULATE from NEUTRAL with higher GGM TP of S$29.50, from S$22.60. We increase earnings by 6% for lower allowances following a better credit outlook. We now assume 1.31x FY21e P/BV in our GGM valuation, up from 1.26x
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Check out our compilation of Target Prices
