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Frasers Centrepoint Trust
Recovery on track
■ 1HFY9/22 DPU of 6.136 Scts is within expectations at 50.5% of our FY22F forecast.
■ Retail portfolio occupancy rose to 97.8%; achieved rental reversion of 1.73%.
■ Reiterate Add rating with a slightly higher TP of S$2.75.
1HFY22 results highlights
FCT reported 1HFY9/22 gross revenue and NPI of S$176.2m/S$130.5m, +1.5%/3.8% yoy,
thanks to a full six months’ contribution from ARF acquisition and lower expenses, partly
offset by income loss from divested properties. 1H22 DPU of 6.136 Scts was up 2.3% yoy,
based on a 95.6% payout ratio, with the retention of S$4.8m of distribution income in 1H.
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Mapletree Industrial Trust
Strong performance boost from data centre
■ 4Q/FY22 DPU of 3.49/13.80 Scts were above expectations, at 26.7%/105.8%
of our FY22 forecast.
■ Higher portfolio occupancy underpinned by increased take-up in Singapore.
■ Reiterate Add, with an unchanged TP of S$3.08.
4Q/FY22 results highlights
MINT reported a 35.5%/35.3% yoy rise in 4QFY3/22 revenue/NPI to S$164.1m/ S$124.2m, due to acquisition of an US data centre (DC) portfolio in North America. 4Q DPU rose 5.8% yoy to 3.49 Scts on higher contributions as well as distribution of divestment gains from 26A Ayer Rajah Crescent. 4Q/FY22 DPU of 3.49/13.8 Scts were above expectations, at 26.7%/105.8% of our full-year forecast. Its portfolio was revalued up to S$8.72bn, largely due to a higher value for its data centre portfolio.
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Sheng Siong Group
Good quarter but tougher times ahead
■ 1Q22 NP of S$35.1m (+7.9% qoq, +13.9% yoy) slightly above expectations. Key positive was stronger topline due to Omicron wave and higher inflation.
■ Comparable store sales in coming months could be hurt by elevated demand tapering off with economic reopening; partially cushioned by rising inflation.
■ SSG remains steadfast in its store opening plan, with a target of 3-5 new stores p.a. in the medium term. Reiterate Hold.
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Offshore & Marine
Accretive for KEP, takes time for CE to grow
■ We estimate KEP’s share price accretion post dividend-in-specie from the
proposed merger of Keppel O&M and SMM to range from S$0.48 to S$1.43.
■ The above takes into account a range of dividend in specie in the new
combined entity, Bayberry, of between S$1.28 and S$2.22/share.
■ The deal, which is set to complete by end-22, favours KEP more than SMM, in our view. SMM’s restructuring into a mega yard for growth could take time.
KOM and SMM merger confirmed
KOM, excluding its out-of-scope assets (e.g. Floatel and Dyna-Mac) and Asset Co (includes KOM’s legacy rigs and associated receivables), will merge with SMM to form the combined entity, named Bayberry Ltd (a listed entity in Singapore), with a focus on offshore renewables, new energy, and cleaner O&M solutions. This is a long-awaited deal that should result in synergies between Keppel Offshore & Marine (KOM) and SMM to expand their track records and capabilities, as well as orderbook to S$6.4bn.
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Keppel And Sembcorp Marine To Merge
KEP’s and SMM’s merger has been gestating for a long time. In our view, the merger benefits both parties, both in the short and long term. For KEP, the divestment of KOM will allow it to focus more on asset-light and/or recurring-fee businesses while SMM will become a larger and arguably more competitive entity with a strong renewables focus. Maintain BUY ratings on both KEP and SMM.
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Choo Chiang Holdings (CCHL SP)
Market Leader Set To Benefit From Strong Growth In The Construction Sector
With a dominant position in the distribution of electrical products, Choo Chiang has benefitted from the strong growth in demand for its products, with 2021 EPS growing 190% yoy. We expect Choo Chiang to achieve EPS growth of 13% yoy for 2022, driven by higher sales of its own brand products and tie-ups with contractors for better order visibility. Also, divestment of its existing investment properties could unlock value. We initiate coverage with a BUY and target price of S$0.56, pegged to 12x 2022F mean PE.
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