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CGS CIMB |
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Singapore Telecommunications (ST SP) 4QFY20: In Line, Weak 1QFY21 Outlook To Be Offset By Long-term Opportunities
4QFY20 core net profit fell 15% yoy to S$594m (+8% qoq) amid lower roaming revenue, lower handset sales, a weaker AUD and higher depreciation charges. These were offset by narrowed Airtel losses as associate earnings surged 24% yoy. FY20 core net profit of S$2,457m (-13% yoy) is in line with our expectation but we cut our FY21-22 net profit forecasts by 14%/9% to account for the weak 1QFY21 outlook. Maintain BUY but cut DCF-based target price to S$2.80, in tandem with the earnings forecast downgrade.
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Keppel Corporation The next lap for long-term growth
■ In its Vision 2030 plan, KEP keeps its long-term 15% ROE target, focusing on sustainability, asset-light businesses that are scalable, moving away from oil. ■ Segments are reshuffled into 1) Energy & Environment, 2) Urban Development, 3) Connectivity, and 4) Asset Management. ■ Maintain Add call and target price of S$7.48. Catalyst: successful partial offer by Temasek. Risk: protracted global recession.
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RHB |
RHB |
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City Developments (CIT SP) Trading At Attractive Valuations; U/G To BUY
U/G BUY from Neutral with new SGD9.50 TP from SGD10.50, 24% upside. While City Developments’ portfolio faces near-term headwinds, we believe most of the negatives are fully priced in, with the stock trading closer to -2SD levels in P/BV and P/RNAV terms (Figures 2 & 3), and below Global Financial Crisis lows. The slow but steady recurring income build-up, strong balance sheet, and brand name, coupled with an experienced management team, should help CDL emerge stronger from the crisis.
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Sheng Siong (SSG SP) As Safe As Houses; Maintain BUY
Reiterate BUY with new TP of SGD1.72 from SGD1.63, 13% upside and c.3% yield. Moving into 2H20, we continue to favour safe haven stock Sheng Siong amid market concerns on weakening global economy, rising US and China trade tensions and COVID-19 resurgence. Earnings wise, we believe outlook still remains optimistic as grocery sales are likely to remain elevated even after the Circuit Breaker due to prevailing work from home measures.
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Check out our compilation of Target Prices
