| CIMB | MAYBANK KIM ENG |
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Venture Corporation Executing well ■ 4Q16 in line; revenue growth driven by Test & Measurement/Others segment. ■ Venture remains in a net cash position. DPS of S$0.50 was declared for FY16. The company is conserving cash for possible opportunities. ■ One-off items in FY16 include FX gains (S$6.1m), impairment loss on available for sale investments (S$5.9m) and accrual for a legal settlement (S$26.3m). ■ Our target price is raised to S$11.50, still based on 14.4x (10-year historical average) CY18F EPS.
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UOL Group Ltd (UOL SP) Riding the Improving Residential Sentiment Top sector pick; Maintain BUY w/ TP raised 4% UOL reported inline FY16 net profit. Management pointed to improving sentiment for Singapore’s residential market and keen interest at its new launch. UOL has demonstrated strong execution with quick inventory turnover stemming from the right pricing strategy, in our view. We rollforward our valuation basis and raise our TP 4% to SGD7.68, at an implied 22% discount to RNAV of SGD9.90. We build in our initial estimates for 45 Amber Road and incorporate MBKE’s latest TP for UOB (HOLD, TP SGD19.54). Maintain BUY and recommend switching out of CAPL (HOLD, TP SGD3.66) and CDL (HOLD, TP SGD9) into this sector laggard.
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| PHILLIP SECURITIES | |
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China Aviation (Singapore) Oil Expect carrying moderate growth forward US$11.70bn revenue exceeded our expectation of US$11.00bn by 6.3% US$66.4mn share of profit from associates and JVs in line with our expectation of US$66.0mn US$88.9mn net profit in line with our full year expectation of US$89.6mn 4.5 SG cents dividend proposed for FY16 (FY15: 3.0 SG cents). We revise our FY17e/FY18e EPS forecasts to 12.7/15.9 US cents. (Previous: 13.7/17.9 US cents). We maintain our “Buy” rating with an upgraded TP of S$2.00 based on updated blended average forward PER of 11.7x, implying a 31.1% return from the last close price of S$1.525.
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| RHB | OCBC SECURITIES |
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Bumitama Agri FFB Growth Bouncing Back To Double Digits In 2017 Bumitama’s FFB output is expected to bounce back into a strong doubledigit growth on the back of rising mature areas as well as a low base effect 2016. FFB yields, however, are expected to remain at 15- 16tonnes/ha, given its still relatively young age profile of nine years. We tweak our earnings forecasts upwards slightly, raising TP to SGD0.88 (from SGD0.85, 10% upside). This implies 13x 2017F P/E and EV/ha of USD10,000/ha. This is at the low end of its peers, which trade at a USD10,000-20,000/ha range, due to its relatively young age profile and share illiquidity.
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UOL Group: FY16 results broadly in line FY16 PATMI decreased 27% YoY to S$287.0m mainly due to lower gross margins, lower fair value gains on investment properties and lower share of profits from JV companies. We judge these results to be broadly in line with expectations and note that the group also proposed a final dividend of 15 S-cents per share. Despite muted conditions in the domestic residential sector, the group sold a respectable 484 residential units in Singapore in 2016. Management indicates that, while they are of the view that existing property cooling measures may not be lifted over the near term, they see firm demand for projects with good locational and product attributes. There was strong interest shown at The Clement Canopy, a 505-unit condominium at Clementi Avenue 1, which drew large crowds at a preview earlier this month, and the group also recently added two residential sites in its landbank. We continue to like UOL’s shares at current levels given its undemanding valuation at 0.66x price-to-book and healthy balance sheet with 24% gearing ratio and S$301.5m cash. Maintain BUY with an unchanged fair value estimate of S$7.30.
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