ANALYSTS SAY: Buy, Sell, Hold (20 Apr)

UOB KAYHIAN

Keppel DC REIT
A minor near-term hiccup

■ KDC’s 1QFY22 DPU of 2.466 Scts came in below at 23% of our FY22F.
■ We reduce our FY22-23F DPU by 1-5% after factoring in higher electricity cost, litigation provision and updating FY21 numbers. Reiterate Add.
■ We expect the higher electricity cost to weigh on its DPU in the near-term, but demand remains strong which underpins its longer-term income stability.

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CIMB Group (CIMB MK)
Fundamentals Intact – Opportunity To Accumulate On Recent Weakness

Management remains optimistic on its earnings growth recovery in 2022. Despite topups in provisions being required for certain corporate accounts, the overall provision trend is expected to improve. Loans under repayment assistance have been holding up better than expected, providing scope for potential write-backs in excess pre-emptive provisions in 4Q22. Valuations are attractive at -1SD to the historical mean P/B.
Maintain BUY and target price of RM6.30 (0.98x 2022/23 P/B, 9.0% FY22/23 ROE). 

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UOB KAYHIAN

UOB KAYHIAN

Wilmar International (WIL SP) 1Q22 Results Preview: Could See Record Contribution From Palm

Wilmar is scheduled to release its 1Q22 financial update on 29 Apr 22. We are expecting a core net profit of US$360m-380m (1Q21: US$424m). Key factors leading to a lower yoy
profit are a poorer performance from Yihai Kerry Arawana (YKA) and higher effective tax rate. In 1Q21, the China consumer packs business has yet to be impacted by the surge in raw material prices and includes a reversal of MTM losses on hedging derivatives. Maintain BUY. Target price: S$5.50. 

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Malakoff Corporation (MLK MK)
Alam Flora A Boon To The Group

Alam Flora is a key earnings driver for the group as Malakoff’s Tanjung Bin Energy (TBE) awaits new turbine blades in 2H22. Alam Flora will continue to perform well driven by higher waste collection, opex efficiency and growth in non-concession businesses. A tariff hike is a key re-rating catalyst as Alam Flora continues to exceed management’s expectation. The stock offers a generous dividend yield of 8% and trades at -2SD below its mean valuation. Maintain BUY. Target price: RM1.05.

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 Nanofilm (NANO SP): 
1Q22 business update: Strong growth momentum [BUY, TP S$4.12]

ŸGood start to year with all units registered growth in 1Q22
ŸStrong business pipeline for 3C segment with the easing of supply chain disruptions
ŸMinimal impact from recent lockdown in Shanghai; measures in place to mitigate inflationary cost pressures
ŸMaintain BUY with TP of S$4.12; expect strong earnings ahead