buy sell hold 2021



Singapore REITs Monthly – Temporary pain; impending rally

Recommendation: OVERWEIGHT (Maintained)

  • FTSE S-REIT Index dipped 1.3% MoM, as interest rates climb. Hospitality REITs led the pack while overseas industrial SREITs were the biggest losers (-11.4ppts MoM) due to refinancing jitters surrounding EC World REIT (ECWREIT SP Equity, Not Rated) and a high proportion of unhedged interest rate and higher interest costs.

  • Based on the median FOMC member’s Fed fund rate forecast of 3.4% at year end, we could see another 165 bps increase in the Fed rate. Our research team believes that the rate of interest rates would likely peak in 3Q22 before moderating.

  • We remain OVERWEIGHT on the REIT sector with preference on the office and hospitality sectors. SREITS under our coverage are expected to deliver FY22e DPU yields of 4.3-9.9%. We remain OVERWEIGHT on the REIT sector as we think REITs could rally once central banks begin lowering rates.


APAC Realty Ltd
Supported by attractive valuations and yield

■ 1Q22 net profit up 20% yoy to S$9m, making up 31% of our FY22F forecast.

■ Higher share of resale/rental market offset by lower share of new home sales.

■ Reiterate Add rating, with a lower TP of S$0.84.




UnUsUaL Limited (UNU SP/UNUS.SI) 

Novem Acquisition to boost top and bottom-line growth

  • On the edge of glory. After two years of forced hibernation, UnUsUaL (UNU), a live entertainment producer and promoter, is on the cusp of a recovery from both a demand and supply perspective. Pre-pandemic, UNU produced and promoted more than 20 shows across over 10 cities annually. We see scope for UNU to return to such levels in the near-term and advocate investors to build long positions in this unnoticed recovery trade.  

  • Return to profitability. We expect UNU to return to the black in FY23F with revenue/PATMI of SGD45.6m/SGD5.2m, a stunning turnaround from FY22A’s SGD3.6m/-SGD4.2m. Subsequently, we pencil in 4-year revenue/PATMI CAGRs of 28.1%/54.5% on reattainment of pre-pandemic margins.

  • We initiate with an Outperform recommendation and a blended peer and DCF-backed TP of SGD0.192 apiece. 


 ViTrox Corp (VITRO MK)
ABI segment resumes growth trajectory

Mixed developments in 2Q22, but thesis intact
Despite potential hiccups in ViTrox’s MVS segment from subdued Chinese
demand, the ABI segment is expected to fare sequentially better in 2Q22 following the resolution of supply bottlenecks last month.

Our BUY call, TP (pegged to 41x FY23 PER, at +1SD to the 5Y mean) and earnings forecast are maintained.

ViTrox remains our top MY ATE pick owing to its dominant position in machine vision tech, diversified customer base and exposure to high-growth sectors such as EVs/5G/IR4.0; accumulate on weakness. 

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