MAYBANK KIM ENG | MAYBANK KIM ENG |
JUMBO GROUP |
ST ENGINEERING |
OCBC | CIMB |
Property Developers Despite the robust outlook for developers, the sector is still trading at a large discount to NAV and also against historical averages. We note that during property bull-cycles, developers have traded at a premium to their NAV. For example, during the last upcycle in 2010, the forward P/B ratio of the FTSE ST Real Estate Holding and Development Index (FSTREH) reached a peak of 1.13x, while the current forward P/B ratio stands at 0.69, or 0.7 standard deviations (SD) below the 10-year average. We thus see room for further re-rating in the sector, and expect the discount gap to narrow as residential prices continue its upward trajectory.
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Jubilee Industries Holdings Ltd Turnaround of plastic manufacturer for electronics
■ Jubilee is set to swing back into full-year positive net profit after two years of net losses post-restructuring, based on our estimates. ■ Electronic component distribution (ECD) sales rose 90% yoy in 1HFY3/18, driven by new product line acquisitions and strong demand for memory chips and MLCCs. ■ Plans for fivefold capacity expansion by end-FY19F in mechanical moulding business through both organic and inorganic means. ■ Gross margins are likely to improve moving forward, in our view, as higher-margin mechanical business turns around and expands. ■ Initiate coverage with an Add and target price of S$0.051, based on SOP valuation
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Check out our compilation of Target Prices