UOB KayHian Frasers Hospitality Trust (FHT SP) Deepening Footprint Down Under We have retooled our model to factor in a heightened risk profile by increasing our required return assumption, in addition to reducing our DPU estimate, following the yield dilutive transaction. Improving liquidity, deepening geographic diversification, a stronger balance sheet for future acquisitions and scope for further contributions from the acquisition underpin the transaction. Despite the sharp cut in our target price to S$0.81 (from S$1.01), we continue to see value and maintain our BUY recommendation. |
OCBC OUE Limited: Attractive risk-reward at current prices
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CIMB OUE Hospitality Trust Sensitising Crowne Plaza Changi Airport |
OCBC Delfi Limited: Decent valuations now
Own Brands to drive growth Upgrading on price correction After keeping our sell call on Delfi on 11 Aug following its latest results, the share price has declined by 14% vs. STI’s loss of ~0.7%. We note that Delfi’s performance had generally improved for 1H16, as management had in place cost containment initiatives, and implemented price adjustments and product rightsizing while also discontinuing some slow-moving SKUs. Delfi’s Own Brands sales have been the major contributor to the group’s business (~60% of total revenue), and we believe this segment’s sales growth momentum in local currency terms can maintain as the group continues to invest in channel expansion and brand building. Following the share price dip, we believe downside could be limited and hence upgrade the stock from sell to HOLD with an unchanged fair value estimate of S$2.34. |