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REITs – Singapore S-REITs Bi-Weekly Updates (16-26 Feb 21)
S-REITs corrected 2.4% during 16-26 Feb. We expect the rise in the bond yield to persist in the near term, which puts pressure on blue chip S-REITs which are well owned by institutional investors. Switch to laggard S-REITs sheltered from the higher bond yield with their much higher yields. BUY ALLT (Target: S$0.89), LREIT (Target: S$0.97), SUN (Target: S$1.72) and UHU (Target: US$0.95), which provide distribution yields of 7%, 6.2%, 6.5% and 9.4% respectively. Maintain OVERWEIGHT.
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Japfa (JAP SP)
2020: Earnings Beat Expectations; Positive Outlook For 2021; Raise Target Price By 19% 2020 core net profit grew 63.3% yoy, forming 115% of our estimates. This excludes an extraordinary gain of US$140.2m from the sale of dairy-SEA. The better-than-expected results came mainly on the back of the strong recovery of its Indonesia poultry segment. The outlook remains positive for the dairy and APO segments as we continue to see favourable ASPs in 2021. We raise our core earnings forecasts for 2020 and 2021 by 23.8% and 26.3% respectively. Maintain BUY with a 19% higher target price of S$1.17
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DBS VICKERS |
UOB KAYHIAN |
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Singapore Market Focus Seasonal support ahead
• March and April are seasonally positive months • S-REIT pullback presents opportunities • Vaccine beneficiaries back in spotlight • Stocks going ex-dividend
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ATA IMS (AIB MK) Riding High On Key Customers’ Aggressive Expansion
As the preferred partner of its main customer, ATA continues to see higher loadings riding on the customer’s aggressive expansion which will see the volume doubling in five years’ time. It is also deriving alpha growth from trade diversion-related orders, which would dilute its customer concentration. We increase our FY21-22 earnings forecasts by 2-12% post briefing. Maintain BUY with a higher target price of RM3.50.
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Check out our compilation of Target Prices
