| PHILLIP SECURITIES |
MAYBANK KIM ENG |
|
CapitaLand Ascott Trust Occupancy to trend upwards
3Q23 gross profit rose 13% YoY to reach 103% of pre-COVID 3Q19 levels. 3Q23 portfolio RevPAU rose 17% YoY to S$154, reaching 102% of pre-COVID 3Q19 levels on the continued improvement in portfolio occupancy (77% vs 70% in 3Q22) and average daily rates (ADR). We expect effective borrowing cost to rise from 2.4% in 3Q23 to c.3% for FY24e after refinancing all loans due in FY24.
|
CSE Global (CSE SP) New USD110m order – Buy on dips
Maintain BUY with SGD0.65 TP CSE has secured 2 major contracts worth USD110.2m for the design and manufacturing of power distribution centres slated for execution from 2024 to 2025. Moreover, last night (30 Oct), US President Joe Biden approved USD1.3bn to build three new interstate power lines which we believe will benefit CSE. CSE remains our Top Pick in the SMIDs space and, in our view, the recent share price dip represents an attractive buying opportunity. Maintain BUY with a SDG0.65 TP based on 15.5x FY24E P/E.
|
|
MAYBANK KIM ENG |
MAYBANK KIM ENG |
|
Aztech Global (AZTECH SP) Solid 3Q23
Maintain BUY and raising TP to SGD1.08 Aztech announced solid 3Q23 results, with revenue and PATMI up 16.9% YoY to SGD283.4m and +48.6% YoY to SGD30.9m, above our and consensus estimates. Going forward, the ramping up of its Pasir Gudang plant is likely to improve its operating margins and orders from its key customer should continue to grow. As a result, we raise our FY24/25 PATMI forecasts by 6.2% and 5.1%, which increases our TP from SGD0.93 to SGD1.08, based on 8x FY24E P/E. With an attractive potential dividend yield of 8.3% for FY24E, we maintain BUY.
|
CDL Hospitality Trusts (CDREIT SP) On an even keel
Broad-based operational improvement CDLHT’s business update indicates strong top-line growth in 3Q23 YoY, led by recovery in travel. RevPAR grew in most markets; Singapore rose by high teens, led by higher room rates. The cost of debt inched up while the interest-coverage ratio was lower sequentially. We lower our DPU estimates and reduce our TP by 16% to SGD1.05 after factoring in higher interest expense and cost of equity, but maintain BUY due to continued growth and reasonable valuation vs peers.
|
| MAYBANK KIM ENG | UOB KAYHIAN |
|
Civmec Ltd (CVL SP) Firmly on course
1Q24 net profit on track; maintain BUY and TP 1Q24 NPAT of AUD15.2m (+7.3% YoY) was in line with our and market expectations, at about 25/24% of MIBG/street’s full-year forecasts. Notably, the group retains an order book of over AUD1.1b as at end-Sep 2023, while balance sheet remains solid with net cash position of AUD43.9m due to strong operating cashflows. We keep our forecasts intact and maintain BUY with TP of SGD1.05, based on 10x FY24E P/E. Civmec recently unveiled plans to redomicile to Australia, which would increase its chances of securing government and private contracts in the country.
|
STRATEGY – SINGAPORE Alpha Picks: Add SIE, ST, FEH, FEHT, FRKN; Remove SEA, KEP And CLAS
Poor investor sentiment in Oct 23 drove our Alpha Picks portfolio into negative territory; however, it nevertheless beat the STI by 0.1ppt on a market cap-weighted basis. As a result, our portfolio has outperformed the STI 18 out of past 20 months. For Nov 23, we add SIE, ST, FEH, FEHT AND FRKN, while removing SEA, KEP and CLAS.
WHAT’S NEW • Market review. The fragile global investor sentiment deteriorated in mid-Oct 23 as strong US economic and job data, coupled with sticky inflation, reaffirmed the likelihood for “higher-for-longer” interest rates, driving 10-year US Treasury yields to multi-year highs. Also, a few high-profile disappointments from the US earnings season along with heightened geopolitical tensions in the Middle East further dented investor sentiment, resulting in the STI falling 4.7% mom in Oct 23.
|
