| CIMB SECURITIES | OCBC SECURITIES |
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CapitaLand Growth momentum continues
■ FY17 core net profit in line with expectations, making up 98% of our FY17 forecast. ■ Expect stronger China and Vietnam residential performance in FY18. ■ Plans to recycle S$3bn of assets annually and grow total AUM to S$100bn by 2020. ■ Maintain Add with a slightly higher TP of S$4.34.
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ComfortDelGro: Road ahead seems less bumpy
ComfortDelGro’s (CDG) FY17 revenue fell 2.2% to S$3970.9m, mainly attributable to its weaker underlying business (-S$54.1m) due to decreases in taxi (-9.9%) segment and automotive engineering services (-14.3%) but partially offset by Public Transport Services (+3.6%) segment. Consequently, FY17 core PATMI came in within expectations even as it declined 8.4% to S$230.9m, and formed 100.4% of our FY17 forecast. Looking ahead, management has highlighted that stabilization of taxi business will be the key focus for FY18. In our view, while the taxi business remains highly competitive, we expect the rate of decline in CDG’s taxi business to slow down going forward, but possibly at the expense of lower operating margin in order to incentivise existing hirers to continue renting the taxis. We believe the alliance with Uber, if approved, will help stabilize CDG’s earnings outlook, through stabilization of taxi idle rate as well as open up potential opportunities from enlarged fleet to sell petrol and provide vehicle maintenance services. All considered, we roll-forward our valuations and increase our FV from S$2.12 to S$2.25. Hence, given the recent weakness in share price, we upgrade CDG from HOLD to BUY, supported by FY18F dividend yield of ~5.2%.
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| MAYBANK KIM ENG | PHILLIP SECURITIES |
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SATS (SATS SP) Awaiting the growth slipstream
3Q/9M FY18 delivered despite cost pressures 3Q/9MFY18 results were in line with our expectations (and the street’s too, we believe) with 3Q PATMI up 2.3% YoY in the face of cost pressures this year. Going forward, we expect profit growth to accelerate in FY19- FY20E, buoyed by contribution from new ventures and continued productivity initiatives. We raised our P/E- based TP by 7% to SGD6.10 from rolling forward to end-FY20 EPS (mid-FY20 previously) on a multiple of 21x (unchanged), equal to 1SD over 5y mean. Maintain BUY.
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Singapore Exchange Limited Market volatility will drive growth SINGAPORE | FINANCE | UPDATE
NSE, BSE and MSEI will terminate arrangements to licence Indian Indices and/or data of Indian securities to foreign exchanges and/or any exchange, trading or settling venue outside of India. SGX is a major trading venue for offshore Nifty 50 Equity Index Futures. As a result, we expect SGX to lose some FX/Equity synergies. We do not expect significant impact to Market data and Connectivity revenue. Upgrade BUY with lower TP of S$8.89 (previous TP S$9.00) based on DCF.
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UOB KAYHIAN |
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Singapore Airlines (SIA SP) 3QFY18: 62% Rise In Net Profit Is No Small Feat And Earnings Are Above Street’s Full Year Estimates By 20%
While earnings were 6% lower than the two average estimates, it was nonetheless substantially higher than the street’s full-year estimates. SIA Cargo’s profits and Scoot’s profit growth were notable surprises. The former’s profit was the highest in 10 years, while the latter’s was the highest in 5 years. There are no revisions to our net profit estimates, and we will provide further updates post analyst briefing. Maintain BUY on SIA. Target price: S$11.90.
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Check out our compilation of Target Prices
