| PHILLIP SECURITIES |
PHILLIP SECURITIES |
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Real Estate Agencies Can have pie and eat it, too
SINGAPORE | REAL ESTATE (AGENCIES)| INITIATION Both PropNex and APAC Realty (operating under the ERA brand) have close to half the number of real estate agents in Singapore and handled an average c.85% of all property transactions (by no. of units) in 2018. High unleveraged return on capital, due to asset-light nature of business and variable pay structure of most of the salesforce. Resilient even in industry downturns, matching or beating the movements of the property market. Initiate coverage on APAC Realty Limited (BUY; TP S$0.65) and PropNex Limited (BUY; TP S$0.63)
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Singapore Telecom Sector Recovering and restructuring SINGAPORE | TELECOMMUNICATIONS | UPDATE 3 June 2019
Mobile and Pay-Tv revenues expected to be weak in 2019 and stabilise in 2020. Enterprise revenue to surge 20% in 2019 on the back of smart nation initiatives, cybersecurity and managed services. TPG achieved nationwide outdoor coverage in Singapore. Commercial launch is expected to be in late 2019. ACCC opposes the merger of TPG and Vodafone. Singtel and NetLink remain our top picks in the sector. We like Singtel for its recovering regional associates and NetLink for its stable 6% distribution yield. Maintain OVERWEIGHT on the Singapore Telecom sector.
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| CGS CIMB | DBS VICKERS |
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Banks Regional growth as a pillar of strength
■ System loan growth edged up to +4% yoy in Apr 2019, mainly driven by regional biz loans. Flat domestic growth as mortgages contracted 0.3% mom. ■ FD growth was unwaveringly strong at +21.6% yoy, pushing total deposit growth to +7.1% yoy – the highest since Jan 2017. CASA contracted further. ■ Maintain Neutral. UOB remains our top pick - valuations are inexpensive at 1.0x FY19F P/BV (c.1 s.d. below long-term mean) with 5.1% dividend yield.
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Yoma Strategic Holdings
Investing for the future BUY, TP of S$0.40 We maintain our BUY rating on Yoma and TP of S$0.40, based on a 60% discount to RNAV. This implies a 1x forward P/NAV. The stock currently trades at an attractive 0.8x P/BV as it rides through the gestation period of its businesses.
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Check out our compilation of Target Prices
