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AEM Holdings (AEM SP)
1H22: Record 1H22 On Strong Momentum; Revenue Guidance Raised
1H22 earnings of S$83m (+180% yoy) are above our expectations, forming 75% of our full-year estimate. Growth was driven by volume ramp-up for the new generation System Level Testing handlers, Burn-In Test handlers, related consumables and peripheral tools. Management raised 2022 revenue guidance marginally from S$700m750m to S$750m-800m, indicating a softer 2H22, which will form around 33% of 2022 revenue. Downgrade to HOLD with a 10%-lower target price of S$5.02.
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CSE Global (CSE SP)
1H22: Results Below Expectations Due To Supply Chain Disruptions
1H22 earnings of S$4.5m (-55% yoy) are below our expectations, forming 26% of our full-year estimate. This was mainly due to supply chain disruptions which led to longer delivery time. Revenue grew 12% yoy due to infrastructure project revenues.
CSE maintained its interim dividend at 2.75 S cents/share and continues to receive a robust amount of orders. We trim our 2022F/23F earnings forecast by 42%/10%, rolling over our valuation base year to 2023F. Maintain HOLD. Target price: S$0.44.
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Frencken Group (FRKN SP)
1H22: Impacted By Cost Pressures But Improvement Expected In 2H22
1H22 earnings of S$26m (-17% yoy) were largely in line, forming 39% of our full-year estimate. 1H22 revenue grew 4% yoy: semiconductor (+9% yoy), life science (+7% yoy) and industrial automation (+7% yoy) recorded growth while medical (-7% yoy) and automotive (-17% yoy) declined. Frencken expects to pass on higher costs to customers in 2H22 and expects higher hoh revenue across all segments except for industrial automation. Maintain Buy and target price of S$1.60. |
UMS Holdings (UMSH SP)
1H22: Above Expectations; Benefited From Solid Semiconductor Demand Worldwide
1H22 earnings of S$40m (+23% yoy) are above our expectations, forming 65% of our 2022F estimate as UMS continues to benefit from solid semiconductor demand worldwide. UMS's order forecasts remain strong as its key customer expects increased sales despite ongoing supply chain challenges. We raised our 2022 and 2023 EPS by 27% and 35%. Maintain BUY with a 3%-lower target price of S$1.40 (reduce PE peg to mean of 11x 2023F, from 2SD of 15.5x 2022F).
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Ascott Residence Trust (ART SP)
Delivering On Deals
Adding AUM at 2.8% accretion
ART is raising c.SGD150m (or SGD200m including a SGD50m upsized option) to fund its latest acquisition, at 3.2-6.5% EBITDA yield. The assets should help strengthen its stable income contribution and push its long-stay assets closer to its medium-term target. Beyond an c.8% AUM and 2.8% DPU boost, we see upside to yields from recovering RevPAU. Our forecasts and SGD1.40 DDM-based TP are unchanged pending deal closure. We continue to like ART’s diversified portfolio, concentrated long-stay assets, strong balance sheet, and c.SGD300m in residual divestment gains, which could add to capital distributions amid its DPU recovery. BUY.
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Bumitama Agri (BAL SP)
Post 1H22 results briefing
BUY for its single-digit PER & high dividend yields
1H22 results were boosted by record CPO price and lower-than-expected cost. There is upside risk to earnings if BAL’s revised FFB growth guidance of 16-18% YoY materializes for FY22E. Else, we continue to expect earnings to soften in 2H22 following recent CPO price correction and higher fertiliser cost expectations. Trading at single-digit PER offering over 6% dividend yields, BAL remains a BUY with SGD0.88 TP on 8x FY23 PER, -0.5SD its 5Y mean. Its interim DPS of SGD0.0125 will go ex-date on 6 Sept.
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