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UOB KAYHIAN |
CGS INTERNATIONAL |
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Strategy Alpha Picks: Bank Stocks Continue To Pull Ahead
Highlights • Our Jul 26 Alpha Picks beat the FSSTI by 1.4ppt on a market cap-weighted basis, with gains led largely by momentum in banks. • For Aug 26: Add SIAEC; remove CAO. • Aug 26 Alpha Picks: BKM, CIT, FEH, HLA, HUAGL, KEP, NTTDCR, OCBC, OTEK, RSTON, SIE, UGAI, UIBREIT, VALUE and VMS.
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Frasers Logistics & Commercial Trust Logistics strength supports transition
■ 3QFY26 portfolio occupancy remained healthy at 96.1%, underpinned by 99.7% occupancy and strong positive rental reversions in the L&I portfolio. ■ The debt-funded European acquisition raises pro forma gearing to 38.7%. Selective divestments are increasingly important to fund the next growth leg. ■ We reiterate our Add rating with an unchanged DDM-based TP of S$1.10.
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| CGS INTERNATIONAL | UOB KAYHIAN |
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Malayan Banking Bhd Acquiring the remaining stake in MAH
■ On 3 Aug 26, Maybank entered into an agreement to acquire the remaining 31% stake in MAH from Ageas Insurance for RM4.83bn. ■ Maybank said the additional stake would have increased its FY25 net profit by 1.7%. ■ Reiterate Add, premised on an uptrend in net interest margin and strong fee income growth in FY26F, and ROE expansion over FY25-28F.
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Strategy (Malaysia) Alpha Picks: A Barbell Portfolio For Defensive And Opportunistic Alphas
Highlights • Our Jul 26 Alpha Picks outperformed the FBMKLCI (+4.9% vs FBMKLCI: +3.7%). Coraza (+15.2%), Oxford Innotech (+14.1%) and SD Guthrie (+9.9%) led the charge while losers included Mr DIY (-3.7%) and Gamuda (-2.3%). • For Aug 26, we continue to advocate for a barbell investment strategy, combining resilient defensive names capable of weathering a prolonged higher-for-longer cost environment and heightened geopolitical uncertainties stemming from the Middle East, with selective exposure to cyclical opportunities where improving fundamentals are beginning to translate into a more compelling risk-reward profile.
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| MAYBANK SECURITIES | DBS GROUP RESEARCH |
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Seatrium (STM SP) The debate shifts to order wins
Margins delivered, order win becomes the key debate Seatrium's operational turnaround continues to gather pace, with gross margin expanding to 8.6% (+120bps YoY) as a richer mix of series-build projects, divestment gains and structural cost rationalisation supported another strong earnings delivery. However, we believe the investment debate has shifted decisively towards project wins. The order book has declined from SGD23.2b (FY24) to SGD17.8b (FY25) and further to SGD13.3b (1H26), highlighting an elevated backlog burn rate. While management also reiterated that Petrobras' transition towards BOT structures does not materially alter Seatrium's EPC opportunity, we believe the stock has become increasingly binary, with the pace of order replenishment now the key driver of share price performance.
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APAC Realty Ltd
1H26 results: Special dividend cushions a softer year 1H26 PATMI of SGD 9.4mn (-17% y/y) came in slightly below expectations, accounting for c.47-48% of DBS and consensus full year estimates, due to lower new home sales Near-term support for share price underpinned by interim dividend of 1.9 Scts (c.78% payout ratio) and special dividend of 3.6 Scts (above previous special dividend of 3.0 Scts back in FY21), in line with our expectations that excess cash would be returned to shareholders Earnings trajectory skewed to downside in 2H26, with a thinner new launch pipeline and delay of some projects into 2027, partly mitigated by policy support from removal of 15- month wait-out period which should boost resale volumes Maintain HOLD and TP of SGD 0.70
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