CGS CIMB

SATS Ltd
Peek into pro-forma WFS numbers ahead

■ Consolidation of WFS could double SATS’s revenue to S$5.5bn by FY3/24F (proforma) as it becomes the top air cargo handler globally, in our view.
■ We also estimate c.S$4m/S$26m of net profit contribution to SATS in FY3/24F-25F, with refinancing cost savings and gradual synergy benefits.
■ Our TP is raised to S$3.21, based on higher SATS core operations on fasterthan-expected Chinese reopening and revised proforma WFS contribution.

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ISDN Holdings Ltd
Assuming Anggoci COD

■ ISDN provided an update on its mini hydropower business to investors via a virtual investor meeting on Friday, 13 Jan 2023.
■ Proforma net profit impact from its LB1 plant was shared and the company is optimistic that its other two plants could achieve COD soon.
■ We assume Anggoci will obtain COD by end-1Q23F and factor in its net profit contributions for FY23-24F, leading to a higher S$0.61 TP. Maintain Add. 

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CGS CIMB

Singapore Airlines
Time to pocket share price gains

■ Downgrade from Add to Hold as the share price has re-rated 16.5% over the past three months on optimism over China’s reopening on 8 Jan 2023.
■ Maintain our TP at S$5.97, still based on mean CY23F P/BV of 0.9x. 

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Raffles Medical Group (RFMD SP)
China’s Reopening A Strong Start To The New Year

RFMD’s Chinese hospitals are facing a surge in COVID-19 patients due to the relaxation of China’s nationwide restrictions. For its Singapore hospitals, foreign patient levels have recovered close to pre-COVID-19 levels, driven mostly by patients from Indonesia and Southeast Asia. RFMD has also selectively increased prices across some hospital and healthcare services by 3-5%, in a bid to tackle inflationary pressures. Maintain BUY with the same PE-based target price of S$1.58.

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Building Materials – Malaysia
China To Boost The Outlook Ahead

Prices of hard commodities such as aluminium, ferroalloy and tin have gradually rebounded on the back of China’s economic reopening, which has helped to stimulate demand. Favourable fiscal policies from China’s government will also boost its economic growth and support commodity prices accordingly. Continued global supply disruption and the energy crisis also put further pressure on the ongoing shortage. Maintain OVERWEIGHT. Top pick: Press Metal.

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Kim Loong Resources (KIML MK)
Strong Dividend Yield For FY24

For FY24, we reckon that the dividend yield of KIML would remain strong as KIML’s earnings remain relatively stable compared with its peers’. We expect KIML’s milling operating margin to increase in FY24 with higher utilisation and oil extraction rates. On top of that, CPO production is also expected to increase in FY24, which may result in higher mill utilisation rates. Maintain HOLD with a target price of RM1.80.

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