buy sell hold 2021



RH Petrogas (RHP SP)
Well-managed Upstream Oil Company With Drilling Catalysts In 2023

RHP has a solid track record of operating its two mature oil fields onshore Indonesia, and with three potentially high-impact wells to be drilled in 3Q23, we initiate coverage with a BUY rating and a target price of S$0.255. Importantly, the company grew its oil and gas reserves over the 2017-22 period without any acquisitions. Additionally, with oil making up nearly 80% of its production, RHP is very leveraged to the oil price.


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Tenaga Nasional (TNB MK)
Out Of The Woods; Cashflow Management A Key Focus For 2023

The government aims to pay back 1H23 ICPT by Jun 23, which together with easing coal prices and the ability to draw down on a RM6b government guaranteed loan for working capital, will leave TNB in a stronger cashflow position for 2023. In the absence of material re-rating catalysts (listing of Genco is likely in 2025), we maintain HOLD with a RM9.00 target price. The stock trades at mean valuation and offers a 5% dividend yield. Downside is limited, we opine, as the stock is defensive.



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Gaming – Macau
Better-than-expected GGR Recovery

We visited Macau over the weekend ahead of the Easter Festival holidays. The crowds have not fully recovered to pre-pandemic levels but we were encouraged by the pockets of tourist-packed areas. We expect upcoming visitations during the holidays to improve alongside the easing of supply shortage. Nevertheless, there is limited upside for the sector’s valuation given concessionaires’ commitment to non-gaming investments as well as the demise of VIP junkets. Maintain MARKET WEIGHT. Top pick: Sands China.


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Venture Corp (S$18.00, down 4 cents) has recently released its FY22 Annual Report and we highlight some of the key points that were being presented, where management noted that “we see strong tailwinds in sectors such as electric vehicle ecosystem, renewable energy infrastructure, industrial IOT, 5G and cloud. Our expertise and experience in Test & Measurement Instrumentation, Networking & Communications, and Advanced Industrial put us in good stead to capture new opportunities.” 

At $18.00, market cap of Venture Corp is S$5,254mln, FY22 P/E is 14.2x, current P/B is 1.8x, dividend yield is 4.2% and its net cash position of S$788.3mln equates to market cap of 15%. Given that we are expecting Venture Corp to register a 1.2% yoy increase in FY23 net profit to S$374mln while net earnings in FY24 are forecasted to improve by 5.1% yoy to S$393mln, we have a BUY recommendation and our target price of S$20.11 is based on assumptions that it will trade up to its five-year
historical average P/E of 15.7x.



We highlight the key points from YZJ Financial Holdings’ ($0.375, unchanged) FY22AR below:

Following the spin-off from YZJSB’s original shipbuilding operations, YZJFH began its journey as a separate company in 2022 on a strong footing. The spin-off enables YZJFH’s investment management businesses to deliver sustained, long-term growth and returns for
investors. The Group benefits from a sharpened operational focus, as well as customised capital allocation decisions in line with distinct
strategies and industry-specific dynamics.

YZJ Financial Holdings’ market cap stands at S$1.4bln and currently trades at 0.4x PB and 8.9x PE with a 4.8% yield. Consensus target
price stands at S$0.64, representing 70.7% upside from current share price.




Indocement Tunggal Prakarsa (INTP IJ)
Benefits From Lower Coal Prices And East Indonesia Market

We expect INTP to resume profit growth in 2023 with net profit of Rp2.2t, increasing 18.9% yoy. 2023 revenue is expected to grow to Rp17.5t (+7.2% yoy), driven by cement sales volume of 18.1m tonnes (up 3% yoy) and ASP of Rp888,000/tonne (rising 1.9% yoy). The recent downtrend of coal prices would benefit INTP in terms of lower coal input prices. We maintain BUY with a higher target price of Rp13,500 on the back of potential sales, NPAT growth, and continuation of margin expansion in 2023. 


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