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UOB KAYHIAN |
UOB KAYHIAN |
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Small-Mid Cap Strategy Screening For Cash-rich Stocks That Could Be Privatisation Targets
The number of privatisation offers remains elevated, at 15 companies ytd vs 18 in 2024. We did a screening of companies with high net cash as a % of market cap to identify potential privatisation targets and deep value stocks.
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STRATEGY – MALAYSIA Alpha Picks: Positioning For Positive US Trade Deals
Our Jun 25 Alpha Picks outperformed the FBMKLCI (+4.9% vs +1.6%). In anticipation of market-friendly US trade deals being struck and Malaysia retaining its onshoring destination status, our Jul 25 picks raise the bet on semiconductor-related stocks, while still maintaining our emphasis on domestic infrastructure plays. Jul 25 picks: Coraza, Duopharma, Eco World, Gamuda, Hume Cement, IJM, Inari and MYEG.
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CGS CIMB |
CGS CIMB |
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Property Devt & Invt Private home prices up 0.5% qoq in 2Q25
■ 2Q25 flash estimate for URA residential price index rose a slower 0.5% qoq. ■ We maintain our private home prices projection of 0% to 3% for 2025F. ■ Retain sector Neutral. Our sector picks, ranked by preference: UOL, CLI, CIT.
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Food Empire Holdings Ltd Focus on core earnings
■ FEH has issued a second supplemental agreement (SA) to address certain aspects of its redeemable exchange note (REN) with Ikhlas Capital. ■ Under the SA, FEH will seek to eliminate potential revaluation loss/gain via a “fixed-for-fixed” accounting classification. ■ Any potential share price weakness in reaction to this SA is an opportunity to add FEH shares, in our view.
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| LIM & TAN | LIM & TAN |
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Civmec Ltd (S$0.905, up 1.5 cents) is pleased to confirm that it has completed the acquisition of 100% of the shares in Luerssen Australia Pty Ltd (“Luerssen Australia”) from NVL Australia GmbH (“NVL”). Capitalized at S$460mln, Civmec trades at 12x forward P/E and 1.1x P/B with a dividend yield of 5.7%. Given that Civmec is re-building its order books after the cancellation of 6 offshore patrol vessels by the Australian government, its acquisition of Luerssen is timely as this will catapult them to become a main defence contractor for the Australian government instead of being a subcontractor before. Consensus TP for Civmec is $0.96, representing a 5.5% potential upside. We maintain our “Accumulate on Weakness” recommendation as we believe that the stock is in a bottoming process.
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Info-Tech Systems, a Singapore-based software-as-a-service (SaaS) provider specialising in HR and accounting solutions, has launched its IPO of 24.86 million shares at S$0.87 each. The company aims to list on the Singapore Exchange (SGX) mainboard on July 4, marking SGX’s first mainboard IPO in nearly two years and the second listing of 2025. Info-Tech’s IPO close at noon on 2nd July (Today), with the shares scheduled to begin trading at market open on 4th July. With Lion Global as the cornerstone, strong recurring earnings and promising 50% payout in FY26 coupled with strong market growth, we believe Info-Tech will do decently well post IPO. |
