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CGS CIMB |
CGS CIMB |
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Singapore Exchange Buoyed by risk management demand
■ A higher-for-longer interest rate environment could deter a pick-up in market activity, but we think hedging demand should still support overall earnings. ■ We expect 2HFY6/24F net profit of S$269m on the back of a seasonally better half and supported by volatility-driven risk management activity. ■ Reiterate Hold with TP of S$10.50 as elevated interest rates weigh on trading volumes. US Fed fund rate cuts, spurring trading volumes, could-rerate SGX.
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JD.com Inc GMV growth likely to pick up in 2H24F
■ We joined JD’s 2Q24F preview call today (22 Jul). ■ We now project both JD’s overall topline and JD Retail’s revenue to have grown 0.5% yoy in 2Q24F, slightly below our previous expectations. ■ However, given JD’s better expenses control in 2Q24F, we forecast non-GAAP net profit to grow 10.6% yoy, with non-GAAP NPM expansion of 0.3% pt yoy. ■ For FY24F, management maintains its guidance for JD’s revenue growth to outperform China social retail sales growth, and non-GAAP net profit to be stable yoy. ■ Reiterate Add with a lower DCF-based TP of HK$182.
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UOB KAYHIAN |
UOB KAYHIAN |
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Offshore Marine – Singapore Industry Dynamics Remain Robust – Small/Mid Caps Outperform
Despite a small blip in the jack up-rig sector, demand and supply dynamics in the O&M industry continues to tighten, thus cementing the robust utilisation and day rate trends for both rigs as well as offshore vessels. Small/mid-cap O&M stocks in Singapore have done well ytd in stark contrast to STM. Key US oil services companies’ 1H24 results have shown continued strength in international segments, reinforcing our confidence in the sector. Maintain OVERWEIGHT on the sector.
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Oil & Gas – Malaysia Cautiousness in Business Enquiries: Signs Of Local O&G Capex Slowdown?
Geopolitical risk may be the norm in the new world order, but we think this has been happening in Malaysia for the past six years. The highlight of this saga is when Petros took over the role of sole gas aggregator of Sarawak’s gas business, followed by major changes in Petronas’ top leadership roles. Although nothing is confirmed, channel checks suggest activities are slowing down. We advocate defensive stocks that are diversified or East Malaysia-based players. Maintain MARKET WEIGHT.
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| LIM & TAN | LIM & TAN |
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Seatrium ($1.45, down 1 cent) announced that it has secured a series of repairs and upgrades contracts with an aggregate value of S$180 million from partners. All projects, with the exception of one, will be completed by end 2024, further solidifying Seatrium’s position as a market leader in vessel repairs, upgrades and conversions. Seatrium’s market cap stands at S$4.9bln and currently trades at 25.9x forward PE and 0.8x PB. Consensus target price stands at S$2.71, representing 86.9% upside from current share price. Although Seatrium is loss-making currently, we are encouraged by the slew of contract wins that will crystallize from FY25 onwards. In a recent Straits Times article, management sounded cautiously upbeat and confident that with most of the legacy contracts having been depleted by 1H’24, 2H’24 will likely see a strong turnaround, helping to lift full year performance into a turnaround situation. And if so, management hinted that a small dividend could be forthcoming to reward long suffering shareholders, much like what happened in SATS. As such, notwithstanding the potenƟ al overhang from the on-going investigation by the local authorities (outcome still unknown), we believe that Seatrium can still be positioned as a “Turnaround Play” by the market. We maintain an “Accumulate” rating on Seatrium.
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Q & M Dental Group / Q&M ($0.28, 0.005) is proud to announce the release of the “Treatment Plan” on its ArƟ fi cial Intelligence (AI)-module developed by its 49%-owned subsidiary, EM2AI, in collaboration with AI Singapore. To ensure safety and accuracy, we have implemented thoughtful measures to mitigate potential issues such as inaccurate, over or underdiagnosis to maintain precise control over treatment outcomes. By integrating the latest advancements in LLM, this innovative approach not only enhances the accuracy of treatment options, but also instils confidence in dental professionals by providing reliable insights tailored specifically for each patient. Q&M is capitalized at $265mln, Forward PE is 15.6x PE, 2.8x book, 1.9% div yield. Consensus 1 year target price is 37 cents represenƟ ng an upside potenƟ al of 32%. With signs of a turnaround at hand coupled with decent upside potential of 32%, we upgrade to Accumulate for Q&M. |
