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CGS CIMB |
PHILLIP SECURITIES |
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SingTel Valuations cap upside from attractive yields
■ We maintain our Hold call on SingTel with an increased RNAV-derived TP of S$4.10 as we update our estimates post its 4QFY25 results. ■ SingTel’s higher 3-4 year asset recycling target of S$9bn provides room for higher DPS, where we estimate FY26-28F dividend yields of above 5%. ■ SingTel’s CY26F P/E of 21.6x is now more than 1 s.d. above its post-2009 mean trading range, capping upside barring significant asset value unlocking.
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Singapore Air Transport – Jun25 Exit of Jetstar Asia, net positive for SIA
▪ In Jun25, the aviation sector generally saw positive performance, supported by a softer tone on US tariffs. The exception was SIA, which was weighed down by recent geopolitical tensions in the Middle East, rising jet fuel prices and the tragic Air India crash. SIE was the top performers, gaining 29.3%, while SATS and CAO also steadily improved by 2.0% and 0.6%, respectively.
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UOB KAYHIAN |
LIM & TAN |
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CapitaLand Ascendas REIT (CLAR SP) Expanding Data Centre Footprint In Home Base Singapore
We like the acquisition of 9TSD due to its attractive NPI yield of 7.1% after transaction costs. The data centre market in Singapore is supply constrained and has a tight vacancy of 2%. There is potential for rental uplift as 9TSD is 30% under-rented compared with the current market rent of S$390-520 per kW. The data centre can also be enhanced by securing higher power capacity. CLAR provides a 2025 distribution yield of 5.8%. Maintain BUY with a target price of S$3.58.
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Thakral Corporation (S$1.44, down 3 cts) has announced that its associate in Australia, GemLife Communities Group (“GemLife”) has launched an initial public offering (“IPO”) on the Australian Securities Exchange (“ASX”) to raise up to A$750 million at an implied post-money valuation of A$1.58 billion. At S$1.44, Thakral is capitalized at S$184 mln and trades at 6.0x forward P/E and 1.1x P/B with a dividend yield of 2.8%. Following the revaluation of GemLife, Thakral’s P/B would have improved to 0.7x. We understand that Thakral also owns a 9.4% stake in UKbased The Beauty Tech Group Limited. Based on information made available by the management of The Beauty Tech Group back in Feb’25, it is considering its strategic options, which may include an IPO. Consensus TP of $2.04 represents a 41.7% potential upside. |
| UOB KAYHIAN | MAYBANK KIM ENG |
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Consumer – Malaysia Mixed Outlook
The manageable minimum wage hike impact and strengthening ringgit appear to be offset by subdued sentiment. In addition, the sector offers an uninspiring 2025/26 earnings growth of 5.2%/7.8% respectively and is devoid of meaningful catalysts. It is justified by valuations trading close to -1.5SD to its five-year mean. The balanced reward-to-risk payoff underlines our MARKET WEIGHT stance on the sector. Top picks: Eco-Shop and F&N.
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Bank Central Asia (BBCA IJ) Undisrupted growth
Maintain BUY and TP of IDR11,675 Maintain BUY on BBCA, backed by low funding costs, strong liquidity, and solid asset quality. We expect healthy, sustainable growth despite macro headwinds. Early central bank rate cuts could boost lending and earnings momentum. Our TP of IDR11,675 implies a FY25E P/BV of 4.8x. We are monitoring developments closely and will adjust our earnings accordingly. Key risks include weaker loan quality and rising opex.
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