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UOB KAYHIAN |
UOB KAYHIAN |
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CapitaLand Integrated Commercial Trust (CICT SP) Organic Growth From AEIs And Tenant Mix Optimisation
CICT focuses on generating organic growth through AEIs. Phases 3 and 4 of AEI for IMM Building will be completed in 3Q25. Thereafter, it should commence AEI for Tampines Mall in 4Q25 to leverage on URA’s Tampines Master Plan. CICT could acquire the remaining 55% of CapitaSpring in 2026, which may be partially funded by the divestment of Gallileo after ECB takes over as anchor tenant in 4Q25. ION Orchard will provide full-year contribution in 2025. Maintain BUY. Target price: S$2.42.
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STRATEGY – GREATER CHINA 2H25: A Big Beautiful Deal?
We expect the tariff uncertainties to be out of the way by August, possibly driving a further rally in Chinese equities. However, investors should stay nimble, as the US’ longer-term goals of containing China remains. We suggest buying into the following themes: AI/robotics/EV, innovation, consumer services, mass market consumption and US dollar weakness.
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MAYBANK KIM ENG |
UOB KAYHIAN |
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Singapore Market Solid footing
Potential EPS upgrades, policy reform to drive 2H25 Amidst US tariff and policy uncertainty, we expect capital rotations to accelerate. Singapore stands to benefit given strong policy certainty, and a government with a clear mandate to cushion extreme outcomes. Policy reforms could give the market renewed momentum. This could be catalysed by five themes: domestic resilience, positive spill-over from China’s recovery, accelerating corporate capital returns, opportunities from JS-SEZ and AI-led efficiencies. We raise 2025E STI target to 4185. Top picks: CICT, CD, CSE, Food Empire, ISOTeam, Sea, SGX, SCI, ST, STEng.
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GoTo Gojek Tokopedia (GOTO IJ) EBITDA Resilience Back In Focus As M&A Noise Fades
We expect some competition in the ODS segment in 2Q25 although this should be offset by the continuous strong growth in the fintech segment. With M&A sentiment easing, we believe that further growth in adjusted EBITDA in 2H25 will serve as a catalyst to monitor (more colors during the 2Q25 analyst meeting). We maintain BUY on GOTO with a lower target price of Rp78. We use the SOTP method, applying EV/Sales multiples to each segment (ODS, fin-tech, e-commerce) — at levels similar to regional peers.
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| LIM & TAN | LIM & TAN |
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The Edge: Keppel Limited ($7.40, unchanged) has partnered with the Asian Infrastructure Investment Bank (AIIB) to mobilise US$1.5 billion ($1.92 billion) worth of sustainable infrastructure investments and financing opportunities across Asia Pacific.
We continue to maintain an “Accumulate” rating on Keppel Ltd despite the slight share price run up due to Keppel’s monetisation eff orts, which could potentially result in special dividends once legacy assets are monetised. We also conƟ nue to like Keppel for its transformation into a global asset manager and operator, with its platorms and divisions reinforcing one another to deliver stronger value propositons for Keppel’s shareholders.
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Civmec Limited ($0.86, up 0.01) is pleased to announce that it has entered into a binding agreement to acquire 100% of the shares in Luerssen Australia Pty Ltd from NVL Australia GmbH (NVL). This strategic acquisition marks a significant milestone in Civmec’s evolution as a sovereign Australian shipbuilder and will see the full ownership transfer of the Luerssen Australia business, including all assets, employees, and licences, subject to the satisfaction of conditions precedent. The transaction strengthens Australia’s sovereign shipbuilding capability by consolidating design, construction, and operational expertise under a single, locally owned entity—enhancing national resilience and supporting long-term defence industry growth.
At 86 cents, Civmec is capitalized at $436mln and trades at about 10-11x annualized earnings and 1x book value. If Civmec is able to sustain its 6 cents dividend per share payout, yield is an attractive 7%. Given that Civmec is re-building it order books after the cancellation of 6 off shore patrol vessels by the Australian government, its acquisition of Luerssen is timely as this will catapult them to become the main defence contractor for the Australian government instead of being a subcontractor before. We upgrade on recommendation on Civmec to an “Accumulate on Weakness” as we believe that the stock is in a bottoming process. |
