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CGS INTERNATIONAL |
PHILLIP SECURITIES |
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United Overseas Bank Credit costs remain well-managed
■ 1Q26 net profit of S$1.44bn was slightly ahead at 104.7%/104.1% of our/Visible Alpha’s 1Q26F estimates due to lower-than-expected credit costs. ■ In its CEO presentation deck, UOB kept its FY26F outlook unchanged, which we believe indicates credit costs will remain well-managed. ■ Maintain Hold with an unchanged GGM-based TP of S$38.70.
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Phillip Singapore Monthly – May26 Two Godzillas Sighted
SINGAPORE | STRATEGY • Singapore equities eked out a modest gain of 0.6% in April. YTD26, it is up 5.7%. Cyclicals led the recovery as markets price in the worst of the Middle East conflict is over. Transportation was the weakest sector as energy prices remained elevated despite the apparent ceasefire.
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UOB KAYHIAN |
UOB KAYHIAN |
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Beng Kuang Marine (BKM SP) 1Q26: More Positive On Bullish Outlook; Raise Target Price By 17%
Highlights • BKM reported revenue and net profit of S$25.7m (+7.7% yoy) and S$2.8m (-12.7% yoy), representing 24%/19% of our forecasts. • We regard this as positive as we expect more revenue and profit contribution in 2Q26, and in 2H26 onwards following the full consolidation of ASOM. • Maintain BUY with a higher target price of S$0.75, pegged to 14x 2027F PE as BKM continues to gain traction from participation of more institutional and strategic shareholders.
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Strategy Monthly Market Radar Highlights
• The STI rose 0.6% mom to 4,912.69 in April, briefly crossing the 5,000 level twice before retreating amid heightened geopolitical tensions and volatility. • Key events: Resilient bank performance, strong Wall Street gains on tech earnings and active primary market activity including Kin Global’s IPO. • Key things to look out for: City Developments’ strategic review outcomes (end-1H26); Keppel’s proposed sale of M1 to Simba Telecom (21 May); further developments in the Iran conflict.
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| MAYBANK SECURITIES | MAYBANK SECURITIES |
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StarHub (STH SP) Downgrade to HOLD on weaker outlook, investments
Earnings pressure before enterprise payoff We downgrade STH to HOLD with a lower TP of SGD1.00 (from SGD1.30) following weaker-than-expected 1Q results, consolidation delays and rising visibility of enterprise, IT & cybersecurity investments over 12–24 months. While management continues to position 2026 as a transition year for enterprise scaling, we believe earnings could remain pressured before meaningful revenue benefits emerge from 2027 onwards. We cut FY26/27 NPAT by 65%/45%. Management also indicated openness to fully monetising its remaining 39% Ensign stake (~SGD280m implied value), which could lower net debt/EBITDA to 1.5x from >2x currently, although prospects for a special dividend appear limited as STH remains open to selective M&A.
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United Overseas Bank (UOB SP) Still in building mode
Good targets. Limited execution visibility. HOLD UOB 1Q26 core-earnings were in-line with MIBG/Street expectations. The Group is in building mode where it has kitchen-sinked CRE exposures, and is completing the integration of their Citi-bank acquisition regionally. Now execution remain – especially in accelerating wealth management. Yet timing and form is not yet fully clear. In the meantime, UOB is well positioned from a provisioning and capital standpoint to ride-out current volatility. We keep our TP unchanged, while awaiting better clarity. HOLD.
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