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CGS INTERNATIONAL |
CGS INTERNATIONAL |
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Tiong Woon Corp 40% GPM sustainable
■ FY6/26F core PATMI (S$22.3m, +31% yoy) was in line at 95% of our FY26F. ■ We believe FY27F-29F GPMs in the 40% region are sustainable, upheld by higher utilisation and higher-margin high-tonnage/integrated lift projects. ■ Reiterate Add. TWC is a beneficiary of regional construction- and infrastructure-focused nation-building plans.
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Banks GIL uptrend contained in Jul 2026
■ Banks’ loan growth picked up slightly from 5.5% yoy at end-Jun 26 to 5.6% at end-Jul 26, lifted by further improvement in business loan. ■ Another positive take was that mom increase in GIL narrowed significantly to RM56m in Jul 26 (+0.2% mom), from RM309m-843m in May-Jun 26. ■ We retain our Overweight stance on banks, premised on robust fee income in CY26F and our expectation for rising dividend payout ratio over CY26-28F.
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| UOB KAYHIAN | UOB KAYHIAN |
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Strategy Chasing The Laggards
Highlights • We screened the 30 STI component stocks for companies with sound fundamentals but are trading at a significant discount in terms of PE or P/B. • YZJ’s 2026F PE of 9.5x is the lowest among the 30 STI component stocks. It has the potential to re-rate towards peers’ average 2028F PE of 11.3x. CityDev’s P/B 0.77x is the fifth lowest. The unveiling of CityDev’s strategic review by Sep 26 could be a catalyst for re-rating. MPACT’s P/B of 0.73x is the fourth lowest. A recovery for Festival Walk in Hong Kong and three office buildings at the Makuhari sub-market in Chiba City could generate a turnaround.
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REITs S-REITs Monthly Update (Aug 26)
Highlights • An influx of safe-haven liquidity and low domestic interest rates have led to a record volume of transaction for commercial properties, encompassing office and retail properties. Thus, the S-REIT sector is supported by firm asset valuation and continued low cost of debt. • Maintain OVERWEIGHT. The S-REIT sector is a major laggard. Thus, SREITs are likely to be more resilient in the event of a correction in the broader market: BUY CICT (Target: S$3.06), FLT (Target: S$1.33), MPACT (Target: S$1.75), NTTDCR (Target: US$1.31) and UIBREIT (Target: S$1.16).
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| UOB KAYHIAN | MAYBANK SECURITIES |
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KORE US REIT (KORE SP) 1H26: Record Leasing Volume; Payout Ratio At 21%
Highlights • NPI and distributable income grew 6.1% and 2.1% yoy respectively in 1H26. The results included a one-off termination fee of US$2.7m and restoration fee of US$2.3m. DPU of 0.4 US cents represented a payout ratio of 21%. • Leasing momentum accelerated in 2Q26 with 492,365sf signed, of which 90.6% were renewals. KORE secured new 10-year lease for 32,000sf of Westpark Portfolio in Redmond with a life sciences instrumentation tenant. • KORE plans to progressively increase its payout ratio towards a sustainable level. Maintain BUY with target price of US$0.25.
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Keppel Ltd (KEP SP) Unlocking value, pursuing growth
Transformation gaining momentum, initiate with BUY We initiate coverage of KEP with a BUY and SOTP-based TP of SGD13.0. KEP is transforming into a global asset manager and operator, positioning itself as a unique ecosystem play for digital infrastructure and sustainable urbanization. Divesting non-core assets is unlocking capital for growth and improving shareholder returns. With growing recurring income and profitability, we believe KEP is positioned to deliver quality growth and sustain a valuation re-rating. Key risks: slower recycling, lower power spreads, weak digital demand/technology shift, concession non-renewal.
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