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PHILLIP SECURITIES |
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Far East Hospitality Trust Resilient balance sheet and ready to acquire
Forward booking for 2H23 and 1H24 was healthy on the back of the recovery of flight capacity and a series of upcoming events. Hotel RevPAR is anticipated to reach 97% of pre-pandemic levels and serviced residence is already at 122% of the pre-COVID level.
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Singapore Banking Monthly Interest rates dip slightly
December’s 3M-SORA was down 2bps MoM to 3.74% and was similar to the 4Q23 average. This is the first decline in 11 months.3M-HIBOR was down 7bps MoM to 5.37%, but still the second highest level in 2023.
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UOB KAYHIAN |
CGS CIMB |
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United Hampshire US REIT (UHU SP) The Year Of Retail Renaissance
UHU’s strip centres are benefitting from: a) continued growth of domestic consumption, b) population migration to suburban locations, c) overcoming of e-commerce disruption through adoption of omni-channel strategies, and d) limited new supply and record low vacancy of 6.6%. There is renewed interest from institutional investors, who are rediscovering the merits of retail assets and strip centres. UHU provides a 2024 distribution yield of 9.2% and trades at P/NAV of 0.68x. Maintain BUY. Target price: US$0.64.
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Gamuda Exuding a new confidence
■ Gamuda expects FY7/24F to be another record year for the group; it is bullish of securing higher-margin data centre contracts. ■ We raise our FY24F/FY25F/FY26F EPS by 7%/7%/6%. ■ Reiterate Add with higher SOP-derived TP of RM6.50
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| LIM & TAN | OCBC SECURIITES |
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Alpha Asia Separate Account (the Fund), managed by Keppel Corporation (S$7.05, up 6 cents), has acquired Wevolve Pte. Ltd. which holds the office and retail space of Wilkie Edge (the Property), an eight-storey mixed-use development in Selegie, Singapore’s prominent education district, at an aggregate consideration of S$348 million. Keppel Corp’s market cap stands at S$12.4bln and currently trades at 9.5x forward PE and 1.15x PB, with a dividend yield of 4.7%. The consensus target price stands at S$7.61, representing an 8% upside from the current share price. We continue to like Keppel’s green initiatives and it’s move towards being a global organization, which would help to minimize country/ region risk going forward. However, given that Keppel has risen slightly since our last recommendation and that potential upside is around 8% based on target price of $7.52, we now have an Accumulate on weakness rating on Keppel Corp.
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Seatrium Limited (STM SP) - Early stages of an offshore CAPEX cycle
• An order win (offshore oil and gas) and a cancellation (offshore wind) • Dayrates in oil and gas recovering amid tightening supply/demand balance • Offshore wind industry meets some stumbling blocks in the meantime
Offshore wind meets some stumbling blocks – On the other hand, as highlighted in our earlier sector report, “Renewable Energy - Sunny Skies, Weaker Winds”, the offshore wind industry has been facing some challenges in recent times, and this include project economics for some on the back of high interest rates. We update our estimates and our fair value for Seatrium slips slightly from SGD0.185 to SGD0.175. ESG updates Seatrium’s ESG rating was upgraded in March 2023, following the combination of Keppel Offshore & Marine (O&M) and Sembcorp Marine. According to research, the company leads most global peers on corporate governance. While it is a stateowned enterprise with government representatives as nominated directors, the board remains majority independent, with separate CEO and chair roles, as of June 2022. BUY |
