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PHILLIP SECURITIES |
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AEM Holdings (AEM SP)
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CapitaLand Investment Limited Growing recurring income streams
▪ 9M23 revenue of S$2.085bn (-3% YoY) was slightly below our estimates, forming 69% of our FY23e forecast. ▪ Fee-related revenue is on the rise, driven by a 31% increase in lodging management fees and a 9% growth in recurring fund management fees. However, this is offset by a significant decrease of 64% in event-driven fees. Including embedded funds under management (FUM) of S$10bn that is pending deployment, CLI has reached its 2024 FUM target of S$100bn. Total recurring income for 9M23 grew by 9% YoY.
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PHILLIP SECURITIES |
PHILLIP SECURITIES |
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Oversea-Chinese Banking Corp Ltd Higher NII and fee income raise profits
▪ 3Q23 earnings of S$1.81bn were slightly above our estimates. It came from higher net interest income and higher fee income offset by lower insurance income and higher allowances. 9M23 PATMI was 77% of our FY23e forecast. ▪ NII grew 17% YoY as NIM rose 21bps YoY to 2.27% and loan growth declined 2% YoY. Total non-interest income rose 4% YoY as higher fee income was offset by lower insurance income while trading income was flat. Allowances rose 19% due to higher SPs as credit costs increased 4bps YoY to 17bps.
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Valuetronics Holdings Ltd Returning to growth, trading around 90% cash
▪ 1H24 PATMI grew 42% YoY to HKD82.1mn, and above our expectations. Revenue and PATMI were 42%/62% of our FY24e estimates. Revenue decline was due to lower component prices. The company announced a special dividend of HKD4 cents in addition to interim HKD4 cents. ▪ Earnings growth was driven by (i) gross margin expansion from lower component prices and a weaker renminbi; (ii) an increase in interest income; and (iii) lower operating expenses, especially depreciation.
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Singapore Telecommunications Ltd Aggressively restructuring to reality
▪ 1H24 revenue and EBITDA were within our expectations at 46% of our FY24e forecast. EBITDA declined 5% YoY to S$1.78bn due to an 11% contraction in Optus earnings. Underlying net profit rose 11% to S$1.12bn despite a 4% point drag on currency. ▪ Singtel increased interim dividends by 13% to 5.2 cents and revised higher its payout ratio from 60-80% to 70-90%. A 3-year programme to remove S$600mn (of S$200mn p.a. FY24-26) of indirect cost was announced.
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SASSEUR REIT Record occupancy and robust outlet sales
• 3Q23 results were within expectations. 9M23 rental income in SGD/RMB terms was 75%/75% of our FY23e estimates. No change in SASSR’s FY23 guidance. • Outlet sales in 3Q23 surged 15.8% to RMB1.1bn due to the success of a series of sales events. EMA rental income was lifted by 6.5% YoY in RMB terms. Depreciation of RMB by 8.2% YoY and higher financing cost continue being a drag for SASSR.
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