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PHILLIP SECURITIES |
UOB KAYHIAN |
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China Aviation Oil Increasing trading volume
• International air traffic surged 32% YTD in Apr25, and we expect profit from associates (SPIA) to rise at least 12% YoY in FY25e, supported by the continued recovery of inbound leisure and business travel.
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REITs – Singapore S-REITs Monthly Update (May 25)
Singapore is a haven due to fiscal discipline and having the lowest reciprocal tariff of 10%. The flight to safety is evidenced by a low 10-year Singapore government bond yield of 2.4% and 3-month compounded SORA of 2.3%. Maintain OVERWEIGHT. Many bluechip S-REITs are trading at attractive yields of 6-7%. BUY retail REITs CICT (Target: S$2.37) and FCT (Target: S$2.73), data centre REIT DCREIT (Target: US$0.90) and healthcare REIT PREIT (Target: S$4.85). We also like CLAS (Target: S$1.38).
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UOB KAYHIAN |
CGS CIMB |
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Valuetronics (VALUE SP)
FY25: Record Margins And Dividend Underpin Healthy FY26; Raise Target Price By 6%
VALUE’s FY25 performance met expectations, with revenue up 4% yoy and PATMI up 7% yoy. Gross margin rose to a record-high 17% on a stronger sales mix and new customer contributions. A higher final dividend lifted total FY25 dividend to 27 HK cents/share, matching the highest since FY18. VALUE is cautiously optimistic about its new customers despite trade uncertainties. Maintain BUY with a 6% higher target price of S$0.83. Valuation is attractive at 6.8% yield and 3x ex-cash PE for FY26.
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SATS Ltd Time to put the levers of growth to work
■ We hosted SATS for a post-results NDR luncheon on 28 May 2025. ■ We remain positive on SATS as we think its continued market share gains offers resiliency to earnings downside amid global trade uncertainties. ■ Reiterate Add with an unchanged DCF-based (WACC: 12.2%, TG: 1.0%) TP of S$3.60, supported by a c.15% 3-year EPS CAGR over FY25-FY28F.
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| MAYBANK KIM ENG | LIM & TAN |
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CapitaLand Ascendas REIT (CLAR SP) Acquisitions deepen footprint
Accretive purchase of Singapore assets in tech sector CLAR announced it will acquire a data centre (DC) and business park for SGD724.6m. The modern assets in a good location with tech tenants will deepen CLAR’s presence in Singapore’s strategic sectors. The deal will be financed with SGD500m of equity raised and SGD275m of debt. Pro-forma dividend and NAV accretion is 1.36% and 3.5%, respectively, with gearing relatively unchanged. Maintain BUY due to CLAR’s diversified portfolio, exposure to value-added manufacturing/R&D and strong credit.
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The Straits Times: Sembcorp Industries’ / SCI (S$6.69, up 5 cts) wholly owned renewables subsidiary Sembcorp Green Infra has been awarded a build-own-operate solar energy storage hybrid project by SJVN, an Indian state-owned power company SCI’s market cap stands at $11.9bln and currently trades at 10.7x forward PE and 2.2x PB, with a dividend yield of 3.4%. Consensus target price stands at $7.46, representing 11.5% upside from current share price. SCI’s fundamentals continue to remain fundamentally sound and valuations are not exactly demanding in terms of PE. However, we acknowledge share price has outperformed in recent times and thus recommend an Accumulate on weakness for SCI. |
