buy sell hold 2021

CGS CIMB

CGS CIMB

Venture Corporation
Seasonally stronger 2H remains valid


■ We hosted Venture Corporation (Venture) at our second virtual Tech & EV Conference on 29 Mar 2023.
■ Key investor concerns include: 1) outlook for FY23F; 2) management’s plans for its Batu Kawan site; and 3) how the company will deploy its cash.
■ We reiterate our Add call with a TP of S$20.10. 

 

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Banks
Deposit growth still in motion


■ System loans contracted (-4.3% yoy) for a 4th consecutive month in Feb 23.
■ Deposit growth was steady (+6.1% yoy) in Feb 23, largely fueled by FCY deposits (+10% yoy) placed as FDs (+78% yoy). LDR trended lower to 73%.
■ Reiterate Neutral. Sustained FD placements (and funding costs) should add sequential NIM pressure. Peaking Fed rates limit earnings upside. 

 

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CGS CIMB

UOB KAYHIAN

Banks
Not expecting a qoq spike in 1Q23 LLP


■ Loan growth picked up slightly from 5% yoy at end-Jan 23 to 5.2% yoy at end-Feb 23 but we project weaker growth of 4-5% for 2023F.
■ We do not expect any qoq spike in banks’ 1Q23F LLP given the small increase of only RM157m in total provision in 2M23.
■ Reiterate Overweight on banks as we project stronger non-interest income growth in 2023F and potential write-back of management overlay.

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REITs – Singapore
S-REITs Monthly Update (Mar 23)


We are cautiously optimistic that inflation would ease gradually in 1H23. The external environment remains uncertain with geopolitical rivalries persisting. We focus on defensive S-REITs with resilient balance sheets. S-REITs would benefit from the easing of interest rates in 2024 in the event economic growth slows down or falters. Maintain OVERWEIGHT. BUY CLAS (Target: S$1.39), CLAR (Target: S$3.30), FLT (Target: S$1.56)
and MLT (Target: S$1.99). 

 

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UOB KAYHIAN UOB KAYHIAN

STRATEGY – MALAYSIA

Alpha Picks: Improving Domestic Liquidity


Our Alpha Picks outperformed the FBMKLCI (+0.5% vs -2.2%) in March. FBMKLCI has bottomed out at the 1,400 level (at close to -2SD to historical mean PE), and we expect improving domestic liquidity and the unity government’s stability to lift Malaysian equities through 2H23. Apr 23 picks: British American Tobacco (BAT), Genting Malaysia (GENM), Malaysia Airports, Mr DIY, My EG Services and Yinson. Mr DIY was added to our picks as the exit of shareholder Creador has lifted shareholder overhang concern. 

 

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STRATEGY – CHINA
Alpha Picks: April Conviction Calls


MSCI China Index rose 4.5% in March after policy support from the Fed and SNB prevented financial contagion. Some investors also regard the resultant liquidity injection as a return to QE. With expectations that the Chinese economy will show further improvement in April, we believe that Chinese equities will have a positive bias. Hence, we add Alibaba, Anta, BYD, COLI, Shuanghuan Driveline, Tencent and Trip.com to our BUY list and Weimob to our SELL list. 

 

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