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UOB KAYHIAN |
UOB KAYHIAN |
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Singapore Airlines (SIA SP) Near-term Outlook Clouded By Elevated Jet Fuel Prices Amid Middle East Tensions Highlights
• Aug 26 operating data came in in line with our projection, with pax load and cargo load rising 1.5% and 2.8% yoy, respectively. • The sharp rebound in jet fuel prices amid re-escalated Middle East tensions has led us to cut our FY27/28 earnings forecasts for SIA by 21%/5%, respectively. Our 2QFY27 net profit guidance has been reduced to S$230m370m. • Air India is reportedly seeking fresh capital injection from its owners including SIA. Weighing the opportunities in India and the uncertainties related to Air India’s turnaround timeline, we are largely neutral towards this deal. • Downgrade SIA to SELL due to lack of near-term catalysts, with a lower target price of S$6.16 (pegged to 1.19x FY27F P/B).
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Contemporary Amperex Technology Co (300750 CH)
Fears Overdone; Bottom Fishing Opportunity Emerges Highlights • CATL’s installations continue to outgrow the market. Order flows remain strong, and capacity utilisation remains tight through year-end. • The Hungary plant launch is delayed to at least 1Q27, but other plants can cover the shortfall. The Chongqing plant acquisition adds 18GWh in capacity, saves build time, and extends CATL’s coverage to southwest China. • Fears that OEMs will switch away from CATL are groundless, due to its moats in technology, reliability and brand equity. Maintain BUY and keep the target prices for A-share/H-share at Rmb585.00/HK$675.00. Valuation is attractive at 12.3x 2027F PE.
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| CGS INTERNATIONAL | MAYBANK SECURITIES |
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YTL Power International Reserves 7 turbines for new CCGT capacity
■ YTLP has secured 4 additional gas turbines, bringing the total to 7, with the potential to support ~5.25GW of new CCGT power plant capacity. ■ This strengthens its competitive edge and execution readiness to pursue new CCGT projects, amid rising regional power demand, especially from DCs. ■ Reiterate Add and our SOP-based TP of RM6.50. We see the recent share price weakness as a good opportunity to accumulate.
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Grab Holdings (GRAB US) Atome: paying up for the next growth engine
Atome valuation leaves little room for error Grab’s USD1.49bn acquisition of a 60% stake in Atome marks its largest financial services transaction to date. Based on Grab’s targets, we estimate Atome could contribute c.USD200m–220m of EBITDA by 2028, implying c.12x FY28 EV/EBITDA based on our estimated ultimate consideration. This is well above the c.7x paid for Stash and most fintech peers, but broadly comparable with Affirm at 12.6x and below PayTM at 30x. We view the valuation as full rather than excessive. Importantly, the premium valuation requires Grab to successfully leverage Atome’s underwriting technology, merchant relationships, and consumer-lending infrastructure across its much larger ecosystem.
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| LIM & TAN | |
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We highlight the summary from CapitaLand Investment Limited’s ($2.65, unchanged) BofA Global Real Estate Conference 2026 presentation, where management reiterated its strategy of accelerating growth in its listed and private fund management platforms while CLI’s market cap stands at S$13.2bln and currently trades at 21.5x forward PE and 1.1x PB, with a dividend yield of 4.5%. Consensus target price stands at S$3.45, representing 30.2% upside from current share price. We continue to like CLI for its turnaround situation with the China government recently coming up with more constructive measures to support the China property market as well as its ability to capitalize on its robust South East Asian exposure which is benefitting from the flight to safety from the current geopolitical unrest. As such, we continue to maintain an Accumulate rating on CLI.
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