UOB KAYHIAN

Aviation – Singapore
A Potentially Steeper-than-expected Recovery Trajectory

Mar 22 air traffic data at Changi Airport and operating data of Singapore Airlines beat our forecasts, even before the positive impacts from the border measure relaxations kicked in. Singapore’s scraping of pre-departure test requirements for fullyvaccinated air travellers entering Singapore would further support a sector recovery.
Maintain MARKET WEIGHT on the sector. Maintain BUY on SIA Engineering (new TP: S$2.90) and SATS (new TP: S$4.85) and HOLD on SIA (new TP: S$4.85).

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iFAST Corporation (IFAST SP)
1Q22: Sequential Slowdown In AUA From Key Market Singapore

AUA declined sequentially to S$18.63b (+15.6% yoy, -1.9% qoq), as key market Singapore (71% of overall AUA) saw redemptions mainly from the B2C segment due to the volatile global equity and bond markets. Management still expects a moderate growth in 2022 net revenue as a whole, but also expects profitability to narrow due to higher opex arising from the new ePension division in Hong Kong. Downgrade to HOLD with lowered target price of S$5.17 (from S$9.84). Entry price: S$4.40.

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UOB KAYHIAN

UOB KAYHIAN

Mapletree Commercial Trust (MCT SP)
2HFY22: Emerging Stronger From COVID-19 Pandemic

VivoCity and its office/business park portfolio achieved positive rental reversion of 2.1% and 1.7% respectively in 1HFY22 despite the COVID-19 pandemic. The easing of safe distancing measures this week will improve shopper traffic and tenant sales at VivoCity and physical occupancy at its office/business park properties. The merger with MNACT is accretive to pro forma 1HFY22 DPU by 7.5% (scrip-only) to 8.9% (scrip-andcash and cash-only). Maintain BUY. Target price: S$2.52.

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Venture Corporation (VMS SP)
Expect Healthy Earnings Growth In 1Q22 On The Back Of Positive Outlook

We expect VMS to report 1Q22 earnings of S$78m (23% of 2022), representing a 20% yoy growth. The strong growth will be driven by: a) robust demand outlook from VMS’ customers, b) improvement in the global component shortages, and c) easing of border restrictions and restrictive measures in Malaysia. VMS is trading at an attractive valuation of 2022F ex-cash PE of 12x vs its clients’ average PE of 28x along with a dividend yield of 4.7%. Maintain BUY and target price of S$22.80.

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LHN Logistics Ltd – Logistics partner in container and chemicals

• Spin-off of logistics arm by parent company LHN Group (BUY, TP: S$0.49).
• To raise 167.7mn shares, including 25.2mn placement shares, at S$0.20 per share, to raise gross proceeds of S$5mn. Post-IPO market cap will be S$33.5mn.
• Two main segments, transportation and container depot services. Growth drivers include new ISO tank depot and expected recovery of container depot utilisation rates.

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Kawan Food
Acquiring five vacant parcels for RM50.5m

■ Kawan announced yesterday that it is acquiring five vacant land parcels on 7.1 acres in Bandar Shah Alam, Negeri Selangor, for a total of RM50.5m.
■ This acquisition (expected to be completed by 4Q22) is in line with Kawan’s expansion plan for business diversification and optimisation of logistic costs.
■ We are positive on this matter while we hold off inputting impact to earnings.

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