| UOB KAYHIAN |
CGS CIMB |
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Singapore Airlines (SIA SP) Feb 24 Operation Data: Both Pax And Cargo Data Better Than Expected
SIA’s Feb 24 operation data beat our expectation, with pax load and cargo load exceeding our projections by 4.3% and 6.8% respectively. The strong pax load benefitted from the boost in Chinese visitor arrivals after Singapore’s implementation of the visa-free arrangement for Chinese visitors effective from 9 Feb 24. We raise our FY24 net profit forecast by 1.8% and estimate SIA’s 4QFY24 core net profit at S$553m. Maintain HOLD with a higher target price of S$6.31.
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Hong Leong Asia Overlooked SG/MY building materials proxy
■ We believe HLA is an underappreciated proxy to the SG/MY construction industry upcycle – current share price implies 2.5x P/E for its BMU unit. ■ BMU segment’s PAT grew 167% yoy in 2H23 as its MY operations returned to profitability, while its SG operations also benefited from strong orderbook. ■ We forecast 15% PATMI growth in FY24F riding on strong growth momentum of its BMU business and diesel engine unit recovering from a low-base.
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UOB KAYHIAN |
OCBC SECURITIES |
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Gojek Tokopedia (GOTO IJ) Kitchen Sink Of Rp76.6t In Goodwill Might Clear Future Negative Surprise
GOTO disclosed that there could be a goodwill impairment charge in 4Q23. We view that if the entire balance of Rp76.6t is charged off, it will clear the negative surprise in 2024. GOTO will record a positive adjusted EBITDA in 4Q23 with the on-demand service segment continuously being EBITDA positive. Future upside will come from selling financial service and providing loans to TikTok customers. With the large impairment surprise behind us, we upgrade GOTO to HOLD with a target price of Rp73.
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Singtel Rating BUY (as at 18 March 2024)
No impending sale of Optus
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| LIM & TAN | MAYBANK KIM ENG |
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Singapore Post ($0.38, unchanged) today announced the completion of the strategic review of the group. The strategic review was initiated in May 2023 where Merrill Lynch (Singapore) Pte. Ltd. (“BofA Securities”) was appointed as the financial advisor with the aim of enhancing shareholder returns and ensuring the Group is appropriately valued. SingPost’s market cap stands at S$855.0mln and trades at 22.4x forward PE and current 0.8x PB, with a present dividend yield of 1.5%. Consensus target price stands at S$0.56, representing 47% upside from current share price. Although valuations are fair, we think that this strategic review is much needed to help Singapore Post unlock value for shareholders as Singapore Post’s share price is at an all time low since it’s listing in 2003. Despite lowering their dividend policy from 60%-80% range to between 30%-50%, we believe that the extra cash will enable Singapore Post to have more firepower to transform into a much better company following its strategic review. As such, we recommend an “Accumulate” on Singapore Post.
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Genting Malaysia (GENM MK) Short term renovation pain for long term revenue gain
Maintain BUY call with a lower MYR3.16 DCF-TP (-3%) We visited RWG on 14 Mar 2024 to observe RWG operations. In our view, mass market GGR will take a backseat in FY24E after GENM temporarily shuttered the Circus Palace and Hollywood mass gaming floors for renovation but history tells us that it will come back stronger from FY25E onwards. We cut FY24E earnings by 15% but leave FY25E and FY26E earnings unchanged. We also trim our DCF-TP to MYR3.16 from MYR3.26. With >10% upside potential still, we maintain our BUY call on GENM.
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