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Yangzijiang Shipbuilding
Riding the LNG momentum
■ YZJ has secured orders for 4 units of 8,000 TEU LNG dual-fuel containerships from PIL. We estimate that these are worth US$100m/vessel.
■ YZJ’s YTD order wins total US$990m, which is a positive surprise. Its orderbook currently stands at US$8.15bn with revenue visibility till mid-FY25.
■ Reiterate Add and TP of S$1.63, still based on 10x CY23F P/E (2-year historical average). We see positive share price movement from this news.
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SPH REIT
Awaiting more catalysts
■ SPH REIT’s 9MFY22 DPU of 4.13 Scts was in line at 78.3% of our FY22F.
■ Tenant sales recovered on further reopening and recovery, as anticipated.
■ Market seems to have priced in a recovery. Reiterate Hold.
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REITs – Singapore
Data Centre REITs – Fundamentals Are Healthy, Customers Are Expanding
Cloud service providers were portrayed as aggressive competitors who prefer to build their own hyperscale data centres. The evidence suggests otherwise. Cloud service providers are a key source of demand. A multi-cloud strategy would reduce concentration and tame the power wielded by cloud service providers. Data centre REITs benefit from limited future supply. BUY DCREIT (Target: S$0.98) and MINT (Target: S$3.36). |
Bursa Malaysia (BURSA MK)
Risk To Reward Finely Balanced
Despite the recent share price retracement on the back of sharply softer ADV, Bursa’s risk to reward has yet to turn positive with current valuations residing at its 10-year mean
on its 2023 earnings forecast. Our 2023 earnings forecast builds in a modest recovery based on pre-COVID-19 mean ADV assumption of RM2.10b. As such, current risk to reward is fairly balanced. Maintain HOLD with a target price of RM6.40 (23.0x 2023F PE).
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Genting Bhd (GENT MK)
Travel in style between Las Vegas Convention Centre and Resorts World Las Vegas
Maintain BUY call and MYR5.96 SOP-based TP
Taking a break from TauRx Pharmaceuticals (Not Listed) related news, the underground tunnel connecting Resorts World Las Vegas (RWLV) with Las Vegas Convention Centre (LVCC) via Tesla cars dubbed the Vegas Loop opened on 30 Jun 2022 as we had flagged earlier (link). We expect the Vegas Loop to boost business at RWLV and aid in narrowing its losses markedly going forward. Our earnings estimates and MYR5.96 SOP-based TP are unchanged. Maintain BUY call on GENT.
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V.S. Industry (VSI MK)
Pass (but with room for improvement)
No evidence of systemic forced labour practices
The independent review of VSI’s labour practices by PWC has finally concluded, with no evidence of systemic forced labour practices identified. We maintain our earnings assumptions and TP of MYR1.07, derived by pegging its fully-diluted FY23E EPS of 6.4 sen to a PER multiple of 16.7x, in-line with the company’s 5Y historical PER mean. We prefer ATECH (BUY, TP: MYR2.03) as our top EMS pick.
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