PHILLIP SECURITIES

Singapore Banking Monthly
NII growth offset fee income decline

SINGAPORE | BANKING& FINANCE | UPDATE
 February’s 3M-SORA was up 16bps MoM to 3.21%, 3M-SIBOR was down 4bps MoM to 4.21%.
 4Q22 results, banks’ NII rose 55% YoY as NIM improved by 69bps with loans growth of 2%. Fee income was a drag, declining 20%. Banks are guiding for NIMs of 2.10-2.25% (FY22: 1.75%-1.91%) and mid-single digit loans growth for FY23e.

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Q & M Dental Group Ltd
Pursuing operating leverage post-record expansion

SINGAPORE | HEALTHCARE | 4Q22 RESULTS (Amended) 10 March 2023
 Revenue met expectations but earnings were below. FY22 revenue and adjusted PATMI were 99%/90% of our forecast. The significant drop in COVID-19 related earnings and higher
expenses in the development of AI-guided clinical support systems were the drag.
 Our adjusted PATMI excludes S$5.1mn of impairment of inventories (S$4.9mn) and plant and equipment (S$0.2mn) incurred in 4Q22.

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UOB KAYHIAN

SATS (SATS SP)
More Attractive Risk-reward Profile After Share Price Decline, Time To Buy

At the recent ASEAN Gems Conference held on 7-8 Mar 23, SATS’ management shared the company’s outlook and clarified investors’ queries about the WFS deal. With the recent share price decline, SATS’ risk-reward profile is more attractive and now is a good entry point, in our view. Maintain BUY on SATS with an unchanged target price (for ex-rights shares) of S$3.02 based on a 9.7x FY25F EV/EBITDA.

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Plantation – Malaysia
Palm Oil Production Upcycle Coming Soon

End-Feb 23 inventory came in lower than market expectations but still failed to lift CPO prices, mainly due to the weakness in oilseeds and other vegoils. The lower inventory was mainly due to lower imports and high domestic consumption. We expect strong production in the upcoming months as La Nina has ended. We also expect demand to improve in Mar 23, with Malaysia players benefitting from a slowdown in Indonesian exports. Maintain MARKET WEIGHT. 

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Plantation – Malaysia
Palm Oil Production Upcycle Coming Soon

End-Feb 23 inventory came in lower than market expectations but still failed to lift CPO prices, mainly due to the weakness in oilseeds and other vegoils. The lower inventory was mainly due to lower imports and high domestic consumption. We expect strong production in the upcoming months as La Nina has ended. We also expect demand to improve in Mar 23, with Malaysia players benefitting from a slowdown in Indonesian exports. Maintain MARKET WEIGHT.

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Greatech Technology (GREATEC MK)
Charting Next Growth Phase Via Two-pronged Approach

Greatech recently closed the year on a record quarter despite industry-wide challenges. The latest orderbook backlog stood at RM760m, with the group aiming to secure another RM800m in 2023. To drive huge quantum leaps in terms of earnings as well as market cap, management does not discount the possibility of synergy integration for technology advancement and IP/market/customer expansion. Maintain BUY. Target Price: RM6.30. 

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