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CGS INTERNATIONAL |
UOB KAYHIAN |
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CSE Global Awaiting Champion’s contribution in 2H26F
■ We hosted CSE’s management for a NDR on 2 Jun 2026 and remain upbeat on its strong DC-led growth trajectory and hyperscaler-driven momentum. ■ We expect 1H26F net profit to form c.40% of FY26F, with weaker margins and elevated costs ahead of Champion-driven acceleration in 2H26F. ■ Retain Add, backed by FY26–28F EPS CAGR of 23%; lower TP of S$2.00 reflects a c.5% FY27F EPS cut, still based on 24x FY27F P/E.
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REITs 1Q26 Round-Up: Demonstrating Resiliency And Gradual Upturn
Highlights • FCT, FLT, KDCREIT and SUN surpassed expectations, but KREIT and MPACT missed expectations. Results from 11 out of the 17 large-cap S-REITs under our coverage met expectations. • Safe haven inflows kept domestic interest rates depressed. Three-month compounded SORA eased marginally by 13bp to 1.06% in 5M26. • Maintain OVERWEIGHT. BUY blue-chip S-REITs with attractive yields and positive catalysts: CICT (Target: S$3.06), FLT (Target: S$1.33), NTTDCR (Target: US$1.43) and UIBREIT (Target: S$1.17).
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| LIM & TAN | LIM & TAN |
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CapitaLand Ascendas REIT ($2.50, unchanged) announced that it is acquiring 5 Tuas Avenue 5 in Singapore, for a purchase consideration of S$133.9 million from Hup Hin Transport Co Pte Ltd (the Vendor) (the Acquisition). The property is a modern ramp-up logistics asset that was CLAR’s market cap stands at S$12.5bln and currently trades at 16.5x forward PE and 1.1x PB, with a dividend yield of 6%. Consensus target price stands at $3.12, representing 24.4% upside from current share price. We maintain an “Accumulate” rating on CLAR, especially on further price weakness.
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First REIT’s market cap stands at S$498mln and trades at 0.94x P/B with a dividend yield of 8.5%. First REIT’s DPU has experienced DPU weakness in recent years, in part due to IDR/SGD foreign currency volatility which has impacted unitholder returns. The proposed divestments will allow First REIT to fully exit from the Indonesia market and refocus on long-term growth in developed markets. As part of the ongoing Strategic Review, potential acquisitions in the Asia-Pacific region includes Singapore, Japan and Australia, and expansion into non-healthcare sectors. Consensus TP stands at 24.5 cts, representing a 4.3% potenƟ al upside. Given the proposed divestments at a slight premium to valuations, full recovery of S$7.1mln rental arrears, and taking into account the IFA’s opinion, we recommend exisƟ ng shareholders to “Vote in Favour” of the resolutions. |
| DBS GROUP RESEARCH | DBS GROUP RESEARCH |
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Equity Outlook – June 2026 Accumulate on June’s lull
• STI YE target of 5250 maintained under our base case scenario • Selectively accumulate 9 STI constituents with July/Aug exdividend and 2H26 catalysts • 3 strategies for SG tech – semiconductors on buy-on-pullback, AI/semicon recovery plays, and earlier-stage AI names
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Food Empire Holdings
Adjusting for 1-for-5 bonus issue Investment Overview Fast growing instant‑coffee‑mix and ingredient player in emerging Eurasia. Food Empire Holdings (FEH) is a leading player in the 3‑in‑1 coffee segment across Russia, Ukraine, Kazakhstan and other CIS markets in Eastern Europe, commanding a dominant market share of over 60%. In recent years, the group has also strengthened its presence in Vietnam’s branded coffee segment and expanded its coffee ingredient business in South Asia, supported by new production facilities planned in India and Vietnam.
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