CGS CIMB | CGS CIMB |
Singapore Strategy Faith arise
■ Singapore to relax Phase 2 restrictions after 13 Jun if community cases fall. ■ We believe economic impact of the Covid-19 resurgence will be contained in a shorter period amid speedier vaccinations and ever-ready targeted relief. ■ We still expect FSSTI FY22F EPS growth at 14%, which justifies our 3,488 pts target based on +0.5 s.d. of mean 15.3x P/E. ■ Our picks surround themes of 1) reopening, 2) defensive, 3) growth, 4) restructuring and 5) valuations. Add big caps: CD, SPH, UOL, KEP, SATS.
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Banks Speedbump in growth
■ Banking system loans tapered 0.6% mom (-1.1% yoy) in Apr 21, coming off a gradual deceleration since the 2.4% mom growth spurt in Jan 21. ■ While DBU deposits were flattish mom (+4.7% yoy) in Apr 21, CASA balances contracted in favour of FDs for the first time since Sep 19. ■ Industry LDR stayed relatively low at 94.3% in Apr 21. Meanwhile, credit card charge-offs declined to 5% -- a positive indicator of asset quality, in our view. ■ Reiterate Overweight. Faster-than-expected economic reopenings could spur stronger credit growth. SG economy remains on track to reopen in mid-Jun.
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UOB KAYHIAN |
OCBC |
Valuetronics (VALUE SP) FY21: Above Expectations; Outlook Remains Challenging
FY21 net profit of HK$187.1m (+4.6% yoy) was above our expectations, forming 117% of our full-year earnings estimate, largely due to better-than-expected revenue in 2HFY21. But we expect a challenging outlook as the impact of customers switching to suppliers outside China is expected to be more substantial in FY22. Furthermore, the global component shortage may hurt margins and affect VALUE’s ability to meet orders. Maintain HOLD with a higher target price of S$0.66 (12x FY22F PE).
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Singtel Hitting the reset button
Investment thesis Singtel’s 2HFY21 operating revenue was down 0.7% YoY to SGD8.2b while EBITDA fell 12.2% YoY. The increasing ROIC from mid-signal-digit levels to low-to- |
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