|
UOB KAYHIAN |
LIM & TAN |
|
United Overseas Bank (UOB SP) Repositioning For A Brighter 2026
Highlights • UOB seeks to grow wholesale banking by financing regional supply chains. For retail banking, it aims to grow the invested AUM for wealth management. • On a full-year basis, NIM could be at the bottom end of its previous guidance of 1.85-1.90% for 2025 due to the recent steep drop in 3M SORA. • UOB intends to top up general provisions from 80bp to 90bp of gross loans, which would lead to high credit costs in 2H25.
|
Sanli Environmental Limited ($0.31, up 0.03) announced that its whollyowned subsidiary, Sanli M&E Engineering Pte Ltd, together with China Railway Electrification Engineering Group Co., Ltd. (Singapore Branch) (“China Railway”), has been awarded a project from the Land Transport Authority (“LTA”) with a contract value of approximately S$281.0 million, which marks the largest single contract secured by the Group to date. Little wonder that Bloomberg consensus is bullish on Sanli, expecting its profit to balloon from only $2mln last year to $6mln this year and $9mln next year, putting its forward and prospects PE ratios at 16x and 10x respectively. Bloomberg consensus 1 year target price of 44 cents implies a 1 year potential return of 42% based on Sanli’s last traded price of 31 cents/share. While we don’t yet have a rating on Sanli, we believe that the stock will be in play given its big contract win and potential upside to consensus target price. |
|
LIM & TAN |
MAYBANK KIM ENG |
|
First REIT (S$0.28, unchanged) has entered into a conditional sale and purchase agreement with PT Abadi Jaya Sakti and PT Tigamitra Ekamulia (collectively the “Purchasers”), each of which is an indirect wholly-owned subsidiary of PT. Lippo Karawaci Tbk (“LPKR”) for the proposed divestment of 100.0% of the issued and paid-up share capital of PT Karya Sentra Sejahtera (“PT KSS”), who owns a 100.0% interest in Imperial Aryaduta Hotel & Country Club (“IAHCC”), for a divestment consideration of Rp.332.2 billion (approximately S$25.9 million). First REIT’s market cap stands at S$590mln and trades at 1.0x P/B with a forward dividend yield of 8.0%. The divestment of Imperial Aryaduta Hotel & Country Club is in line with First REIT’s aim to unlock value through the disposal of non-core, non-healthcare assets. While First REIT’s core operations remain steady with higher rental income in local currency terms, a continued weakening IDR may impact income and DPU in SGD terms. First REIT is in the midst of an ongoing strategic review where they are exploring all options, including and not limited to asset acquisitions and/or asset divestments, expansion into non-healthcare sectors. Consensus TP stands at $0.31, representing a 10.7% potential upside.
|
IHH Healthcare (IHH MK) Advancing the pieces
Maintain BUY, raise TP to MYR9.42 IHH enters an undeterred growth phase, led by re-energised India ops with Fortis-Gleneagles synergies amid regulatory clarity, the re-opening of SG’s Mt Elizabeth Hospitals, and MY’s DRG delay and medical tourism focus. High utilisation and rising case complexity also supports IHH’s capacity ramp-ups across the board. We revise our valuations to reflect higher (i) market cap for India, and (ii) EV/EBITDA multiples for MY/SG ops. For housekeeping purposes, we trim FY25E-27E CNP by 1-2%. Our SOTP-TP is raised to MYR9.42 (from MYR7.97). Maintain BUY; IHH is now our top pick.
|
| UOB KAYHIAN | DBS RESEARCH |
|
Tenaga Nasional (TNB MK) Tenaga To Spearhead Malaysia’s Cross-border Energy Transmission Expansion
Highlights • Tenaga is poised to benefit from the numerous projects under the ASEAN Power Grid initiative, including: a) the Malaysia-Singapore second power interconnection, and b) the Sarawak-Peninsular Malaysia interconnection project. • Malaysia’s nuclear energy adoption is expected to be a boon to Tenaga should they be the frontrunners to pioneer Malaysia’s first nuclear power plant. • Maintain BUY with a DCF-based target price of RM16.30.
|
Sheng Siong Group
Path to 120 stores and beyond Investment Thesis: Investing in state-of-the-art distribution centre (DC) to facilitate next phase of store network growth. The company plans to invest a budgeted SGD520mn in a facility slated for completion by end-2029, designed to support at least 120 stores. This investment is necessary to unlock future growth, given the current facility’s optimal capacity of ~70 stores. The scale and technology of the new DC are expected to enhance gross margins and operating efficiency over time, fully offsetting the increase in depreciation.
|
