ASEAN Insight Provider, CrossASEAN Research

Angus Mackintosh

ASEAN Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Cross Asset Strategy

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The week that was in <a href="mailto:ASEAN@Smartkarma" target="_blank" rel="noopener">ASEAN@Smartkarma</a> is filled with another eclectic mix of differentiated, substantive, and actionable insights from across South East Asia and includes macro, top-down and thematic pieces, as well as actionable equity bottom-up and credit insights over the past week.
We add below a NEW section, which includes emerging themes in ASEAN and selects important news flow or developments for commentary, which may impact SE Asian companies and markets. 
</div><h3>Macro Insights</h3>In <a href="https://www.smartkarma.com/insights/singapore-s-post-pandemic-economic-strategy-does-not-go-far-enough" target="_blank" rel="noopener">Singapore's post-pandemic Economic Strategy Does Not Go Far Enough</a>, economist <a href="https://www.smartkarma.com/profiles/nigel-chiang" target="_blank" rel="noopener">Nigel Chiang</a> discusses Singapore's post-pandemic economic strategy and economic outlook. <h3>Equity Bottom Up</h3>In <a href="https://www.smartkarma.com/insights/telkom-indonesia-tlkm-ij-digital-catalysts-abound" target="_blank" rel="noopener">Telkom Indonesia (TLKM IJ) - Digital Catalysts Abound?</a>, CrossASEAN insight provider <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener">Angus Mackintosh</a> returns to look at <a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" rel="noopener">Telekomunikasi Indonesia (TLKM IJ)</a> after the company released a decent set of FY2020 results.<a href="https://www.smartkarma.com/entities/telekomunikasi-indonesia" target="_blank" data-smartkarma-citation="entities:1051:1" rel="noopener"></a>In <a href="https://www.smartkarma.com/insights/ace-hardware-aces-ij-renovation-complete-time-to-move-in" target="_blank" rel="noopener">Ace Hardware (ACES IJ) - Renovation Complete, Time to Move-In</a>, <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener">Angus Mackintosh</a> circles back to <a href="https://www.smartkarma.com/entities/ace-hardware-indonesia" target="_blank" rel="noopener">Ace Hardware Indonesia (ACES IJ)</a> post its FY2020 results where the company managed to record a solid performance despite the pandemic. In <a href="https://www.smartkarma.com/insights/philippine-stock-exchange-pse-pm-solid-foundations-for-future-growth" target="_blank" rel="noopener">Philippine Stock Exchange (PSE PM) - Solid Foundations for Future Growth</a>, Crossasean Insight Provider <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener">Angus Mackintosh</a> reports back on <a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" rel="noopener">Philippine Stock Exchange (PSE PM)</a> that just released a strong set of 1Q2021 results, underpinning a positive view.In <a href="https://www.smartkarma.com/insights/erajaya-swasembada-eraa-ij-the-empire-strikes-back" target="_blank" rel="noopener">Erajaya Swasembada (ERAA IJ) - The Empire Strikes Back</a>, CrossASEAN Insight Provider <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" rel="noopener">Angus Mackintosh</a> circles back to <a href="https://www.smartkarma.com/entities/erajaya-swasembada-tbk-pt" target="_blank" rel="noopener">Erajaya Swasembada (ERAA IJ)</a> after it released a strong set of 1Q2021 results. In <a href="https://www.smartkarma.com/insights/berli-jucker-bjc-tb-stock-up-for-canned-recovery" target="_blank" data-smartkarma-citation="insights:52281" rel="noopener">Berli Jucker (BJC TB) - Stock-Up for Canned Recovery?</a> CrossASEAN Inisght Provider <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" data-smartkarma-citation="accounts:937" rel="noopener">Angus Mackintosh</a> circles back to the company post recent 1Q2021 results and a conversation with management.In <a href="https://www.smartkarma.com/insights/xl-axiata-excl-ij-rising-through-the-cloud" target="_blank" data-smartkarma-citation="insights:51936" rel="noopener">XL Axiata (EXCL IJ) - Rising Through The Cloud</a> CrossASEAN Insight Provider <a href="https://www.smartkarma.com/profiles/angus-mackintosh" target="_blank" data-smartkarma-citation="accounts:937" rel="noopener">Angus Mackintosh</a> circles back to <a href="https://www.smartkarma.com/entities/xl-axiata-tbk-pt" target="_blank" data-smartkarma-citation="entities:15028:1" rel="noopener">XL Axiata (EXCL IJ)</a> after recent results and a number of interesting data points regarding 5G.<a href="https://www.smartkarma.com/entities/xl-axiata-tbk-pt" target="_blank" data-smartkarma-citation="entities:15028:1" rel="noopener"></a>In <a href="https://www.smartkarma.com/insights/malaysia-mco-winners" target="_blank" rel="noopener">Malaysia MCO: Winners</a>, <a href="https://www.smartkarma.com/profiles/henry-soediarko" target="_blank" rel="noopener">Henry Soediarko</a> discusses what will happen to the <a href="https://www.smartkarma.com/entities/kuala-lumpur-composite-index" target="_blank" rel="noopener">Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX)</a> as the Malaysian government extends the MCO orders with COVID-19 cases rising.In <a href="https://www.smartkarma.com/insights/kasikornbank-kbank-impact-of-the-nvdr-issuance-halt" target="_blank" rel="noopener">Kasikornbank (KBANK): Impact of the NVDR Issuance Halt</a>, <a href="https://www.smartkarma.com/profiles/brian-freitas" target="_blank" rel="noopener">Brian Freitas</a> returns to look at <a href="https://www.smartkarma.com/entities/kasikornbank-pcl" target="_blank" rel="noopener">Kasikornbank PCL (KBANK TB)</a> after the company announced that investors are unable to buy any more Non-Voting Depository Receipts (NVDR) in the bank due to the current issuance approaching its permitted limit of 25% of issued shares. In <a href="https://www.smartkarma.com/insights/monde-nissin-is-attracting-a-lot-of-long-only-funds" target="_blank" rel="noopener">Monde Nissin Is Attracting a Lot of Long Only Funds</a>, <a href="https://www.smartkarma.com/profiles/oshadhi-kumarasiri" target="_blank" rel="noopener">Oshadhi Kumarasiri</a> reports back on <a href="https://www.smartkarma.com/entities/monde-nissin-corp" target="_blank" rel="noopener">Monde Nissin Corp (0191881D PM)</a>'s ongoing IPO that has already secured 11 cornerstone investors, including GIC, Fidelity International, AIA, and Goldman Sachs Asset Management.In <a href="https://www.smartkarma.com/insights/ea-ev-ess-business-commencement-delayed-to-2h21" target="_blank" rel="noopener">EA: EV-ESS Business Commencement Delayed to 2H21</a>, <a href="https://www.smartkarma.com/companies/country-group" target="_blank" rel="noopener">Country Group</a>' feeds back from <a href="https://www.smartkarma.com/entities/energy-absolute-pcl" target="_blank" rel="noopener">Energy Absolute (EA TB)</a> analyst meeting which  came out in a negative tone.In <a href="https://www.smartkarma.com/insights/bch-strong-earnings-momentum-in-2q21" target="_blank" rel="noopener">BCH: Strong Earnings Momentum in 2Q21</a>, <a href="https://www.smartkarma.com/companies/country-group" target="_blank" rel="noopener">Country Group</a> maintains a HOLD rating for <a href="https://www.smartkarma.com/entities/bangkok-chain-hospital-pcl" target="_blank" rel="noopener">Bangkok Chain Hospital (BCH TB)</a> after the analyst meeting that came out with a positive tone, thanks to solid COVID-19 related revenue from 3rd wave of COVID-19.In <a href="https://www.smartkarma.com/insights/toa-increase-in-raw-material-costs-pressures-2q21-profit" target="_blank" rel="noopener">TOA: Increase in Raw Material Costs Pressures 2Q21 Profit</a>, <a href="https://www.smartkarma.com/companies/country-group" target="_blank" rel="noopener">Country Group</a> maintains a HOLD rating for <a href="https://www.smartkarma.com/entities/toa-paint-thailand-pcl" target="_blank" rel="noopener">TOA Paint (Thailand) (TOA TB)</a>, as they expect that the company's net profit will be weak in 2Q21, due to cost increases.In <a href="https://www.smartkarma.com/insights/hana-benefit-from-strong-demand-could-be-limited-by-chip-shortage" target="_blank" rel="noopener">HANA: Benefit from Strong Demand Could Be Limited by Chip Shortage</a>, <a href="https://www.smartkarma.com/companies/country-group" target="_blank" rel="noopener">Country Group</a> returns to look at <a href="https://www.smartkarma.com/entities/hana-microelectronics-pcl" target="_blank" rel="noopener">Hana Microelectronics (HANA TB)</a> after it released its 1Q2021 results. In <a href="https://www.smartkarma.com/insights/shr-hiccup-in-2q21-before-recover-strongly-in-2h21" target="_blank" rel="noopener">SHR: Hiccup in 2Q21 Before Recover Strongly in 2H21</a>, <a href="https://www.smartkarma.com/companies/country-group" target="_blank" rel="noopener">Country Group</a> maintains HOLD rating for <a href="https://www.smartkarma.com/entities/s-hotels-resorts-pcl" target="_blank" rel="noopener">S Hotels &amp; Resorts PCL (SHR TB)</a> and expects its earning to recover in 2H2021. In <a href="https://www.smartkarma.com/insights/cbg-china-market-is-a-key-growth-driver-in-the-next-three-years" target="_blank" rel="noopener">CBG: China Market Is a Key Growth Driver in the Next Three Years</a>, <a href="https://www.smartkarma.com/companies/country-group" target="_blank" rel="noopener">Country Group</a> keep a BUY rating on <a href="https://www.smartkarma.com/entities/carabao-group-pcl" target="_blank" rel="noopener">Carabao Group (CBG TB)</a> post its recent analyst meeting.<h3>Sector and Thematic </h3>In <a href="https://www.smartkarma.com/insights/the-stocks-to-own-in-thailand-vol-33" target="_blank" rel="noopener">The Stocks to Own in Thailand – Vol. 33</a>, <a href="https://www.smartkarma.com/profiles/dr-andrew-stotz-cfa" target="_blank" rel="noopener">Dr Andrew Stotz, CFA</a> from <a href="https://www.smartkarma.com/companies/a-stotz-investment-research" target="_blank" rel="noopener">A. Stotz Investment Research</a> highlights 14 stocks in Thailand that look interesting to own based upon their FVMR Methodology.<h3>Credit</h3>In <a href="https://www.smartkarma.com/insights/smartkarma-webinar-high-yield-opportunities-in-indonesia-and-india" target="_blank" rel="noopener">Smartkarma Webinar | High-Yield Opportunities in Indonesia and India</a>, Insight Providers <a href="https://www.smartkarma.com/profiles/leonard-law-cfa" target="_blank" rel="noopener">Leonard Law, CFA</a> and <a href="https://www.smartkarma.com/profiles/trung-nguyen" target="_blank" rel="noopener">Trung Nguyen</a> of <a href="https://www.smartkarma.com/companies/lucror-analytics" target="_blank" rel="noopener">Lucror Analytics</a> will go over HY picks for the Indonesian and Indian markets, focusing on names that Lucror covers and outlining their high-conviction "Buy" ideas. Please find the registration details through the above link.


The week that was in ASEAN@Smartkarma is filled with another eclectic mix of differentiated, substantive, and actionable insights from across South East Asia and includes macro, top-down and thematic pieces, as well as actionable equity bottom-up and credit insights over the past week.
We add below a NEW section, which includes emerging themes in ASEAN and selects important news flow or developments for commentary, which may impact SE Asian companies and markets. 
Macro InsightsIn Singapore's post-pandemic Economic Strategy Does Not Go Far Enough, economist Nigel Chiang discusses Singapore's post-pandemic economic strategy and economic outlook. Equity Bottom UpIn Telkom Indonesia (TLKM IJ) - Digital Catalysts Abound?, CrossASEAN insight provider Angus Mackintosh returns to look at Telekomunikasi Indonesia (TLKM IJ) after the company released a decent set of FY2020 results.In Ace Hardware (ACES IJ) - Renovation Complete, Time to Move-In, Angus Mackintosh circles back to Ace Hardware Indonesia (ACES IJ) post its FY2020 results where the company managed to record a solid performance despite the pandemic. In Philippine Stock Exchange (PSE PM) - Solid Foundations for Future Growth, Crossasean Insight Provider Angus Mackintosh reports back on Philippine Stock Exchange (PSE PM) that just released a strong set of 1Q2021 results, underpinning a positive view.In Erajaya Swasembada (ERAA IJ) - The Empire Strikes Back, CrossASEAN Insight Provider Angus Mackintosh circles back to Erajaya Swasembada (ERAA IJ) after it released a strong set of 1Q2021 results. In Berli Jucker (BJC TB) - Stock-Up for Canned Recovery? CrossASEAN Inisght Provider Angus Mackintosh circles back to the company post recent 1Q2021 results and a conversation with management.In XL Axiata (EXCL IJ) - Rising Through The Cloud CrossASEAN Insight Provider Angus Mackintosh circles back to XL Axiata (EXCL IJ) after recent results and a number of interesting data points regarding 5G.In Malaysia MCO: Winners, Henry Soediarko discusses what will happen to the Kuala Lumpur Composite Index (KLCI) (FBMKLCI INDEX) as the Malaysian government extends the MCO orders with COVID-19 cases rising.In Kasikornbank (KBANK): Impact of the NVDR Issuance Halt, Brian Freitas returns to look at Kasikornbank PCL (KBANK TB) after the company announced that investors are unable to buy any more Non-Voting Depository Receipts (NVDR) in the bank due to the current issuance approaching its permitted limit of 25% of issued shares. In Monde Nissin Is Attracting a Lot of Long Only Funds, Oshadhi Kumarasiri reports back on Monde Nissin Corp (0191881D PM)'s ongoing IPO that has already secured 11 cornerstone investors, including GIC, Fidelity International, AIA, and Goldman Sachs Asset Management.In EA: EV-ESS Business Commencement Delayed to 2H21, Country Group' feeds back from Energy Absolute (EA TB) analyst meeting which  came out in a negative tone.In BCH: Strong Earnings Momentum in 2Q21, Country Group maintains a HOLD rating for Bangkok Chain Hospital (BCH TB) after the analyst meeting that came out with a positive tone, thanks to solid COVID-19 related revenue from 3rd wave of COVID-19.In TOA: Increase in Raw Material Costs Pressures 2Q21 Profit, Country Group maintains a HOLD rating for TOA Paint (Thailand) (TOA TB), as they expect that the company's net profit will be weak in 2Q21, due to cost increases.In HANA: Benefit from Strong Demand Could Be Limited by Chip Shortage, Country Group returns to look at Hana Microelectronics (HANA TB) after it released its 1Q2021 results. In SHR: Hiccup in 2Q21 Before Recover Strongly in 2H21, Country Group maintains HOLD rating for S Hotels &amp; Resorts PCL (SHR TB) and expects its earning to recover in 2H2021. In CBG: China Market Is a Key Growth Driver in the Next Three Years, Country Group keep a BUY rating on Carabao Group (CBG TB) post its recent analyst meeting.Sector and Thematic In The Stocks to Own in Thailand – Vol. 33, Dr Andrew Stotz, CFA from A. Stotz Investment Research highlights 14 stocks in Thailand that look interesting to own based upon their FVMR Methodology.CreditIn Smartkarma Webinar | High-Yield Opportunities in Indonesia and India, Insight Providers Leonard Law, CFA and Trung Nguyen of Lucror Analytics will go over HY picks for the Indonesian and Indian markets, focusing on names that Lucror covers and outlining their high-conviction "Buy" ideas. Please find the registration details through the above link.

The Week That Was in ASEAN@Smartkarma - Post Pandemic Singapore, Digital Telkom, and the PSE

Equity Bottom-Up

Philippine Stock Exchange / Equity Bottom-Up

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The <a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange (PSE PM)</a> just released a strong set of 1Q2021 results, with revenue growth of +31.7% and pre-tax profit growth of +121.1%. The exchange saw its net income rise by +199% YoY and EPS by +195% YoY. The better numbers were driven by higher market volumes and particularly from retail investors and a pick-up in IPO activity and placements.
We expect continued momentum behind volumes driven by retail together with more IPO activity in 2Q2021, with the completion of the US$1bn <a href="https://www.smartkarma.com/entities/monde-nissin-corp" target="_blank" data-smartkarma-citation="entities:32188:1" rel="noopener">Monde Nissin Corp (0191881D PM)</a> IPO to come together with <a href="https://www.smartkarma.com/entities/del-monte-philippines-inc" target="_blank" data-smartkarma-citation="entities:26988:1" rel="noopener">Del Monte Philippines (1575316D PM)</a>, National Grid Corporation (NCGP), and REITs from <a href="https://www.smartkarma.com/entities/megaworld-corp" target="_blank" data-smartkarma-citation="entities:8746:1" rel="noopener">Megaworld Corp (MEG PM)</a>, <a href="https://www.smartkarma.com/entities/robinsons-land-corp" target="_blank" data-smartkarma-citation="entities:8831:1" rel="noopener">Robinsons Land Co (RLC PM),</a> and <a href="https://www.smartkarma.com/entities/vista-land-lifescapes-inc" target="_blank" data-smartkarma-citation="entities:18262:1" rel="noopener">Vista Land &amp; Lifescapes (VLL PM)</a>. 
<a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange (PSE PM)</a> is trading at a discount to regional exchanges on 18.6x FY21E PER, which trades on an average forward PER of 27.7x. There are also a number of potential catalysts ahead, the most obvious being higher volumes, driven by increasing retail participation plus significantly higher profile IPOs in FY2021. 
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The Philippine Stock Exchange (PSE PM) just released a strong set of 1Q2021 results, with revenue growth of +31.7% and pre-tax profit growth of +121.1%. The exchange saw its net income rise by +199% YoY and EPS by +195% YoY. The better numbers were driven by higher market volumes and particularly from retail investors and a pick-up in IPO activity and placements.
We expect continued momentum behind volumes driven by retail together with more IPO activity in 2Q2021, with the completion of the US$1bn Monde Nissin Corp (0191881D PM) IPO to come together with Del Monte Philippines (1575316D PM), National Grid Corporation (NCGP), and REITs from Megaworld Corp (MEG PM), Robinsons Land Co (RLC PM), and Vista Land &amp; Lifescapes (VLL PM). 
Philippine Stock Exchange (PSE PM) is trading at a discount to regional exchanges on 18.6x FY21E PER, which trades on an average forward PER of 27.7x. There are also a number of potential catalysts ahead, the most obvious being higher volumes, driven by increasing retail participation plus significantly higher profile IPOs in FY2021. 


Philippine Stock Exchange (PSE PM) - Solid Foundations for Future Growth

Research from SooChow CSSD Capital Markets (Asia), SCCM Asia Research

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<h2>Singapore</h2><h3>SREITs results in a glance (see detailed spreadsheet and calendar attached)</h3><table class="table table-striped"><tbody><tr><td style="width: 167.45pt;"> </td><td style="width: 129.85pt;">CERT (€)</td><td style="width: 117.6pt;">MUST (US$)</td><td style="width: 117.6pt;">KORE (US$)</td></tr><tr><td style="width: 167.45pt;">Period</td><td style="width: 129.85pt;">1Q21</td><td style="width: 117.6pt;">1Q21</td><td style="width: 117.6pt;">1Q21</td></tr><tr><td style="width: 167.45pt;">Gross Revenue (S$ m)</td><td style="width: 129.85pt;">48.5 (-0.1% YoY)</td><td style="width: 117.6pt;">NA</td><td style="width: 117.6pt;">34.6 (-2.1% YoY)</td></tr><tr><td style="width: 167.45pt;">NPI (S$ m)</td><td style="width: 129.85pt;">30.8 (-0.4% YoY)</td><td style="width: 117.6pt;">NA</td><td style="width: 117.6pt;">20.4 (-2.8% YoY)</td></tr><tr><td style="width: 167.45pt;">DPU (S$ c)</td><td style="width: 129.85pt;">0.827 (-9.1% YoY)</td><td style="width: 117.6pt;">NA</td><td style="width: 117.6pt;">Not Disclosed</td></tr><tr><td style="width: 167.45pt;">NAV per Unit (S$)</td><td style="width: 129.85pt;">2.445</td><td style="width: 117.6pt;">0.730</td><td style="width: 117.6pt;">Not Disclosed</td></tr><tr><td style="width: 167.45pt;">P/B (x)</td><td style="width: 129.85pt;">0.978</td><td style="width: 117.6pt;">1.030 (Based on 4Q20 NAV)</td><td style="width: 117.6pt;">0.90 (Based on 4Q20 NAV)</td></tr><tr><td style="width: 167.45pt;">Occupancy (%)</td><td style="width: 129.85pt;">94.6</td><td style="width: 117.6pt;">92.0</td><td style="width: 117.6pt;">91.6</td></tr><tr><td style="width: 167.45pt;">Reversion (%)</td><td style="width: 129.85pt;">-1.3</td><td style="width: 117.6pt;">2.1</td><td style="width: 117.6pt;">5.7</td></tr><tr><td style="width: 167.45pt;">Gearing (%)</td><td style="width: 129.85pt;">38.5</td><td style="width: 117.6pt;">41.3</td><td style="width: 117.6pt;">37.5</td></tr><tr><td style="width: 167.45pt;">Cost of Debt (%)</td><td style="width: 129.85pt;">1.72</td><td style="width: 117.6pt;">3.18</td><td style="width: 117.6pt;">2.82</td></tr><tr><td style="width: 167.45pt;">1 Yr Fwd Yield (%)</td><td style="width: 129.85pt;">7.95</td><td style="width: 117.6pt;">8.00</td><td style="width: 117.6pt;">8.3</td></tr><tr><td style="width: 167.45pt;">Debt Hedged (%)</td><td style="width: 129.85pt;">100</td><td style="width: 117.6pt;">NA</td><td style="width: 117.6pt;">84.7</td></tr><tr><td style="width: 167.45pt;">Target Price</td><td style="width: 129.85pt;">NA</td><td style="width: 117.6pt;">NA</td><td style="width: 117.6pt;">NA</td></tr><tr><td style="width: 167.45pt;">Rating</td><td style="width: 129.85pt;">NA</td><td style="width: 117.6pt;">NA</td><td style="width: 117.6pt;">NA</td></tr></tbody></table><h3><a href="https://www.smartkarma.com/entities/cromwell-european-real-estate" target="_blank" data-smartkarma-citation="entities:25889" rel="noopener">Cromwell European REIT (CERT SP)</a> 1Q21 Business Update – Weakening operational metrics with negative reversions and falling occupancies</h3><ul><li>1Q21 revenue and NPI decreased by 0.1% and 0.4% YoY, respectively, to €48.5m (28.4% BB est) and €30.8m. Prolonged COVID-19 lockdowns impacted 1Q21 gross revenue and NPI, notably reducing carpark income in the mixed-use Central Plaza in Rotterdam, the Netherlands and resulting in some vacancy in certain light industrial/logistics assets in France and Denmark. The disposal of 12 higher-yielding and higher-risk assets in the Netherlands, France and Denmark also affected gross revenue, though this was partially offset by new income from recently completed acquisitions in Italy, Germany, the Czech Republic and Slovakia</li><li>1Q21 DPU decreased 9.1% YoY to €0.827c (21.8% BB est). This due to the same factors impacting DI as well as the timing of the investment of the €100m private placement proceeds to offset the additional weighted average units on issue in Mar21. 1Q21 DI was €21.7m, 6.5% lower YoY, due to the same factors affecting gross revenue and NPI. It was further impacted by €0.8m of higher interest expenses from the €500m longer-tenured bond issuances and certain one-off trust expenses of €0.4m</li><li>Overall portfolio occupancy decreased slightly to 94.6% in 1Q21 (vs. 95.1% in 4Q20 and 94.3% in 3Q20), mainly due to vacancies in office assets in France and Finland and the departure of an anchor tenant-customer (Nilfisk), which relocated its operations to Belgium from the Priorparken 700 / 800 asset in Copenhagen, Denmark. CERT recorded 37 new leases and 21 renewals for 19,735sqm and 13,428sqm of space, respectively. Portfolio WALE stood at 4.8 years. Rental reversions came in at -1.3% in 1Q21 (vs +2.1% in 4Q20 and +2.8% in 3Q20)</li><li>Office – Occupancy of 94.5% (vs 95.1% in 4Q20 and 94.9% in 3Q20). CERT recorded 9 new leases and 7 renewals for 1,180sqm and 2,189sqm of space, respectively. 34% tenant retention rate, 21% of expiries and breaks up to 30Sep21 have been de-risked. Office WALE stood at 4.4 years. Rental reversions came in at -1.0% in 1Q21 (vs +1.7% in 4Q20 and -1.4% in 3Q20)   </li><li>Industrial/logistics – Occupancy of 93.8% (vs 94.1% in 4Q20 and 92.3% in 3Q20). CERT recorded 28 new leases and 13 renewals for 18,556sqm and 10,381sqm of space, respectively. 26% tenant retention rate, 79% of expiries and breaks up to 30Sep21 have been de-risked. Industrial WALE stood at 4.8 years. Rental reversions came in at +1.5% in 1Q21 (vs +3.8% in 4Q20 and +14.4% in 3Q20)   </li><li>Portfolio gearing stands at 38.5% (vs. 38.1% in 4Q20 and 35.9% in 3Q20) with average cost of debt of 1.72% pa. (vs. 1.66% in 4Q20 and 1.5% in 3Q20) with 100% of debt hedged. CERT maintained a strong cash position of €75.8m</li><li>CERT currently trades at 7.95% FY21E yield and 0.978x P/B.</li></ul><h3><a href="https://www.smartkarma.com/entities/manulife-us-reit" target="_blank" data-smartkarma-citation="entities:567" rel="noopener">Manulife US REIT (MUST SP)</a> 1Q21 Business Updates – US office market remains muted, mitigated by limited supply and expiry in MUST’s markets</h3><ul><li>Revenue, NPI and DI were not disclosed in 1Q21</li><li>Overall portfolio occupancy dipped further to 92.0% in 1Q21 (vs. 93.4% in 4Q20 and 94.3% in 3Q20), but is still above the US Class-A average of ~82%</li><li>MUST signed 270,000sqft (~5.8% of NLA) of leases in 1Q21 with +2.1% rental reversions (vs. +0.1% in full-year FY20 and +7.9% in 9M20). These leases are mainly from renewals (93.6%), followed by expansion (5.3%) and new leases (1.1%), supported by finance and insurance, administrative, advertising and legal sectors. It has a long WALE of 5.3 years with ~4.4% (by GRI) or 4.3% (by NLA) of leases up for renewal for the remaining of FY21E. Nonetheless, its current portfolio has a 2.1% in-place rental escalations. Given limited supply in MUST’s markets over the next 12 months, these markets is expected to see a 2.5% rent growth, in line with the overall US average</li><li>Tenants’ collection rate remains healthy (98% collection), but challenges for 2021 include: 1) Low physical occupancy at 5-25% (low carpark income), and 2) existing vacancies remain a challenge to fill (larger space takes longer to fill and it’s still a tenant’s market with higher incentive and rent free)</li><li>Portfolio gearing stands at 41.3% (vs. 41.0% in 4Q20 and 39.9% in 3Q20) with average cost of debt of 3.18% pa. (vs. 3.18% in 4Q20 and 3.21% in 3Q20). In Apr21, MUST has refinanced its loans due FY21E at lower interest rate, bringing weighted average interest rate to 3.0% and increasing weighted average debt maturity to 3.4 years</li><li>MUST currently trades at 8.00% FY21E yield and 1.03x P/B. </li></ul><figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=03e35791bb&amp;attid=0.0.3&amp;permmsgid=msg-f:1699422834728702566&amp;th=1795901073311266&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ8sEKl6WDAe8N9__qHKBNe6-08vbrc8QfHwJamRBTAaR_dON_UK1yOULc7lIYoAqOLnG1bIt-bZRfkFUmsv6mNgGuwGup4IAMyZuiuu1S3HH7pcwGFiu6yseig&amp;disp=emb" width="403" height="199" class="editor-image img-responsive" data-image-whitelisted=""></figure><figure class="editor-figure mceNonEditable"><img src="https://mail.google.com/mail/u/0?ui=2&amp;ik=03e35791bb&amp;attid=0.0.4&amp;permmsgid=msg-f:1699422834728702566&amp;th=1795901073311266&amp;view=fimg&amp;sz=s0-l75-ft&amp;attbid=ANGjdJ_0APJf80bwv3E2S_EiRYN8qcm-reP1OQ2z06j7ZbYooytHl5IJJso0tnZEZ2wCt-YWmA-nXxQk1VnMuNtz5DfMAf0FyvFj2bW9VWWOmPzOeJvwjpGsNdafsus&amp;disp=emb" width="364" height="196" class="editor-image img-responsive" data-image-whitelisted=""></figure><h3><a href="https://www.smartkarma.com/entities/propnex-ltd" target="_blank" data-smartkarma-citation="entities:27209" rel="noopener">Propnex Ltd (PROP SP)</a> 1Q21 PATMI almost doubled to S$16.2m; Debt free balance sheet  </h3>PROP reported a 96.7% YoY growth in net profit after tax for 1Q21 to S$16.2m(vs S$8.2m in 1Q20), on the back of a 63.3% YoY growth in revenue to S$220.6m (vs S$135.1m in 1Q20). The performance was driven by higher number of transactions completed in 1Q21 following the recovery of private residential market from the property cooling measures in Jul18. Revenue growth was mainly driven due to the increase in commission income from agency services of ~S$47.5m and increase in project marketing services of ~S$38.0m. The results translate to an EPS growth of 95.6% YoY to S$4.01c in 1Q21. PROP remained debt free, and its balance sheet remained robust with cash and cash equivalents of S$118.9m as at 31Mar21, compared to S$105.8m as at 31Dec20. PROP has also taken 70% interest in Ovvy, The People Marketplace, a technology platform that connects service providers to consumers.<h3><a href="https://www.smartkarma.com/entities/lh-group-ltd" target="_blank" data-smartkarma-citation="entities:4397" rel="noopener">Pacific Star Development (PSTAR SP)</a> 3Q21 net loss increases, identified uncertainty over operating as going concern</h3>PSTAR, whose management is voicing uncertainty over its ability to operate as a going concern, sank further into the red in 3Q21. Net loss widened to S$8.2m as revenue came in 81% YoY lower at S$674,000 due to lower number of Puteri Cove Residences units sold. Gross profit plunged 90% YoY to S$56,000. The group booked an increase of S$1.28m in other expenses largely due to an increase in trade receivables written off as a result of cancellation of sales and purchase agreements for Puteri Cove Residences units. Loss per share was S$1.64c, higher than S$1.6c the year before. As at 31Mar, the group's net liability position was S$69.3m. PSTAR said there is uncertainty as to whether the group is able to meet its contractual obligations in the next 12 months as and when they fall due, and hence there is uncertainty over its ability to operate as a going concern for the next 12 months.

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached) CERT (€)MUST (US$)KORE (US$)Period1Q211Q211Q21Gross Revenue (S$ m)48.5 (-0.1% YoY)NA34.6 (-2.1% YoY)NPI (S$ m)30.8 (-0.4% YoY)NA20.4 (-2.8% YoY)DPU (S$ c)0.827 (-9.1% YoY)NANot DisclosedNAV per Unit (S$)2.4450.730Not DisclosedP/B (x)0.9781.030 (Based on 4Q20 NAV)0.90 (Based on 4Q20 NAV)Occupancy (%)94.692.091.6Reversion (%)-1.32.15.7Gearing (%)38.541.337.5Cost of Debt (%)1.723.182.821 Yr Fwd Yield (%)7.958.008.3Debt Hedged (%)100NA84.7Target PriceNANANARatingNANANACromwell European REIT (CERT SP) 1Q21 Business Update – Weakening operational metrics with negative reversions and falling occupancies1Q21 revenue and NPI decreased by 0.1% and 0.4% YoY, respectively, to €48.5m (28.4% BB est) and €30.8m. Prolonged COVID-19 lockdowns impacted 1Q21 gross revenue and NPI, notably reducing carpark income in the mixed-use Central Plaza in Rotterdam, the Netherlands and resulting in some vacancy in certain light industrial/logistics assets in France and Denmark. The disposal of 12 higher-yielding and higher-risk assets in the Netherlands, France and Denmark also affected gross revenue, though this was partially offset by new income from recently completed acquisitions in Italy, Germany, the Czech Republic and Slovakia1Q21 DPU decreased 9.1% YoY to €0.827c (21.8% BB est). This due to the same factors impacting DI as well as the timing of the investment of the €100m private placement proceeds to offset the additional weighted average units on issue in Mar21. 1Q21 DI was €21.7m, 6.5% lower YoY, due to the same factors affecting gross revenue and NPI. It was further impacted by €0.8m of higher interest expenses from the €500m longer-tenured bond issuances and certain one-off trust expenses of €0.4mOverall portfolio occupancy decreased slightly to 94.6% in 1Q21 (vs. 95.1% in 4Q20 and 94.3% in 3Q20), mainly due to vacancies in office assets in France and Finland and the departure of an anchor tenant-customer (Nilfisk), which relocated its operations to Belgium from the Priorparken 700 / 800 asset in Copenhagen, Denmark. CERT recorded 37 new leases and 21 renewals for 19,735sqm and 13,428sqm of space, respectively. Portfolio WALE stood at 4.8 years. Rental reversions came in at -1.3% in 1Q21 (vs +2.1% in 4Q20 and +2.8% in 3Q20)Office – Occupancy of 94.5% (vs 95.1% in 4Q20 and 94.9% in 3Q20). CERT recorded 9 new leases and 7 renewals for 1,180sqm and 2,189sqm of space, respectively. 34% tenant retention rate, 21% of expiries and breaks up to 30Sep21 have been de-risked. Office WALE stood at 4.4 years. Rental reversions came in at -1.0% in 1Q21 (vs +1.7% in 4Q20 and -1.4% in 3Q20)   Industrial/logistics – Occupancy of 93.8% (vs 94.1% in 4Q20 and 92.3% in 3Q20). CERT recorded 28 new leases and 13 renewals for 18,556sqm and 10,381sqm of space, respectively. 26% tenant retention rate, 79% of expiries and breaks up to 30Sep21 have been de-risked. Industrial WALE stood at 4.8 years. Rental reversions came in at +1.5% in 1Q21 (vs +3.8% in 4Q20 and +14.4% in 3Q20)   Portfolio gearing stands at 38.5% (vs. 38.1% in 4Q20 and 35.9% in 3Q20) with average cost of debt of 1.72% pa. (vs. 1.66% in 4Q20 and 1.5% in 3Q20) with 100% of debt hedged. CERT maintained a strong cash position of €75.8mCERT currently trades at 7.95% FY21E yield and 0.978x P/B.Manulife US REIT (MUST SP) 1Q21 Business Updates – US office market remains muted, mitigated by limited supply and expiry in MUST’s marketsRevenue, NPI and DI were not disclosed in 1Q21Overall portfolio occupancy dipped further to 92.0% in 1Q21 (vs. 93.4% in 4Q20 and 94.3% in 3Q20), but is still above the US Class-A average of ~82%MUST signed 270,000sqft (~5.8% of NLA) of leases in 1Q21 with +2.1% rental reversions (vs. +0.1% in full-year FY20 and +7.9% in 9M20). These leases are mainly from renewals (93.6%), followed by expansion (5.3%) and new leases (1.1%), supported by finance and insurance, administrative, advertising and legal sectors. It has a long WALE of 5.3 years with ~4.4% (by GRI) or 4.3% (by NLA) of leases up for renewal for the remaining of FY21E. Nonetheless, its current portfolio has a 2.1% in-place rental escalations. Given limited supply in MUST’s markets over the next 12 months, these markets is expected to see a 2.5% rent growth, in line with the overall US averageTenants’ collection rate remains healthy (98% collection), but challenges for 2021 include: 1) Low physical occupancy at 5-25% (low carpark income), and 2) existing vacancies remain a challenge to fill (larger space takes longer to fill and it’s still a tenant’s market with higher incentive and rent free)Portfolio gearing stands at 41.3% (vs. 41.0% in 4Q20 and 39.9% in 3Q20) with average cost of debt of 3.18% pa. (vs. 3.18% in 4Q20 and 3.21% in 3Q20). In Apr21, MUST has refinanced its loans due FY21E at lower interest rate, bringing weighted average interest rate to 3.0% and increasing weighted average debt maturity to 3.4 yearsMUST currently trades at 8.00% FY21E yield and 1.03x P/B. Propnex Ltd (PROP SP) 1Q21 PATMI almost doubled to S$16.2m; Debt free balance sheet  PROP reported a 96.7% YoY growth in net profit after tax for 1Q21 to S$16.2m(vs S$8.2m in 1Q20), on the back of a 63.3% YoY growth in revenue to S$220.6m (vs S$135.1m in 1Q20). The performance was driven by higher number of transactions completed in 1Q21 following the recovery of private residential market from the property cooling measures in Jul18. Revenue growth was mainly driven due to the increase in commission income from agency services of ~S$47.5m and increase in project marketing services of ~S$38.0m. The results translate to an EPS growth of 95.6% YoY to S$4.01c in 1Q21. PROP remained debt free, and its balance sheet remained robust with cash and cash equivalents of S$118.9m as at 31Mar21, compared to S$105.8m as at 31Dec20. PROP has also taken 70% interest in Ovvy, The People Marketplace, a technology platform that connects service providers to consumers.Pacific Star Development (PSTAR SP) 3Q21 net loss increases, identified uncertainty over operating as going concernPSTAR, whose management is voicing uncertainty over its ability to operate as a going concern, sank further into the red in 3Q21. Net loss widened to S$8.2m as revenue came in 81% YoY lower at S$674,000 due to lower number of Puteri Cove Residences units sold. Gross profit plunged 90% YoY to S$56,000. The group booked an increase of S$1.28m in other expenses largely due to an increase in trade receivables written off as a result of cancellation of sales and purchase agreements for Puteri Cove Residences units. Loss per share was S$1.64c, higher than S$1.6c the year before. As at 31Mar, the group's net liability position was S$69.3m. PSTAR said there is uncertainty as to whether the group is able to meet its contractual obligations in the next 12 months as and when they fall due, and hence there is uncertainty over its ability to operate as a going concern for the next 12 months.

ASEAN Builder's Scoop (11May21) - CERT weakening operational metrics

<div class="content-highlight">
Despite pressures on the Philippines from strict lockdowns and continuing issues with rising cases of COVID-19, <a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange Inc (PSE PM)</a> looks increasingly attractive with a powerful combination of rising volumes and a significant pipeline of IPOs in 2021. 
</div>
The exchange has also been a direct beneficiary of COVID-19 as it has encouraged the influx of greater numbers of retail investors, which has boosted market volumes significantly. 
The <a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange Inc (PSE PM)</a> currently only has 272 listed companies, which looks quite a low number but is in the process of encouraging more smaller companies to list. 
The rapid increase in IPOs should be positive for margins given the high listing fees that the listing of new shares attracts. We have just seen the approval pass for the US$1bn <a href="https://www.smartkarma.com/entities/monde-nissin-corp" target="_blank" data-smartkarma-citation="entities:32188:1" rel="noopener">Monde Nissin Corp (0191881D PM)</a> IPO, which will focus attention on the overall market.
<a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange (PSE PM)</a> has outlined a number of new initiatives to increase liquidity and the number of new listings.
The company is also looking to increasingly digitize its business by upgrading its clearing and settlement system and shortening settlement to T+2. 
<div class="content-highlight">
<a href="https://www.smartkarma.com/entities/philippine-stock-exchange-inc" target="_blank" data-smartkarma-citation="entities:23182:1" rel="noopener">Philippine Stock Exchange (PSE PM)</a> is trading at a discount to regional exchanges on 17.1x FY21E PER, which trades on an average forward PER of 29x. There are also a number of potential catalysts ahead, the most obvious being higher volumes, driven by increasing retail participation plus more IPOs in FY2021.
</div>


Despite pressures on the Philippines from strict lockdowns and continuing issues with rising cases of COVID-19, Philippine Stock Exchange Inc (PSE PM) looks increasingly attractive with a powerful combination of rising volumes and a significant pipeline of IPOs in 2021. 

The exchange has also been a direct beneficiary of COVID-19 as it has encouraged the influx of greater numbers of retail investors, which has boosted market volumes significantly. 
The Philippine Stock Exchange Inc (PSE PM) currently only has 272 listed companies, which looks quite a low number but is in the process of encouraging more smaller companies to list. 
The rapid increase in IPOs should be positive for margins given the high listing fees that the listing of new shares attracts. We have just seen the approval pass for the US$1bn Monde Nissin Corp (0191881D PM) IPO, which will focus attention on the overall market.
Philippine Stock Exchange (PSE PM) has outlined a number of new initiatives to increase liquidity and the number of new listings.
The company is also looking to increasingly digitize its business by upgrading its clearing and settlement system and shortening settlement to T+2. 

Philippine Stock Exchange (PSE PM) is trading at a discount to regional exchanges on 17.1x FY21E PER, which trades on an average forward PER of 29x. There are also a number of potential catalysts ahead, the most obvious being higher volumes, driven by increasing retail participation plus more IPOs in FY2021.


Philippine Stock Exchange Inc (PSE PM) - Overlooked and On the Up

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<a href="https://www.smartkarma.com/entities/allhome-corp" target="_blank" data-smartkarma-citation="entities:28227:1" rel="noopener">AllHome (AHM PM)</a> claims to have pioneered the “one-stop-shop” home improvement retailer in the Philippines. AllHome plans to raise up to $404 million in the Philippines’ largest IPO this year. AllHome intends to sell as many as 1.29 billion shares (750 million primary shares) at a maximum price of 16 pesos a share.<div class="content-highlight">With enviable exposure to a fast-growing segment of the retail sector in the Philippines, AllHome seems to have a long runway to maintain its high growth, improving margin equity story. However, our enthusiasm is tempered by the significant cash burn. Overall, we believe that AllHome’s fundamentals offers more positives than negatives and could prove to be attractive at the right valuation.</div>

AllHome (AHM PM) claims to have pioneered the “one-stop-shop” home improvement retailer in the Philippines. AllHome plans to raise up to $404 million in the Philippines’ largest IPO this year. AllHome intends to sell as many as 1.29 billion shares (750 million primary shares) at a maximum price of 16 pesos a share.With enviable exposure to a fast-growing segment of the retail sector in the Philippines, AllHome seems to have a long runway to maintain its high growth, improving margin equity story. However, our enthusiasm is tempered by the significant cash burn. Overall, we believe that AllHome’s fundamentals offers more positives than negatives and could prove to be attractive at the right valuation.

AllHome IPO Initiation: Cash-Guzzling Growth

Philippines

Vista Land & Lifescapes, Inc. is an investment holding company. The Company, through its subsidiaries develops and sells residential subdivisions and housing units. Vista Land operates in the Philippines.

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Vista Land & Lifescapes (VLL PM)

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Philippine Stock Exchange (PSE PM) - Solid Foundations for Future Growth

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Angus Mackintosh

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Philippine Stock Exchange Inc (PSE PM) - Overlooked and On the Up

The Philippine Stock Exchange (PSE PM) is probably the most overlooked listed stock exchange in Asia, with the catalyst of higher volumes driven by...

Angus Mackintosh

AllHome IPO Initiation: Cash-Guzzling Growth

AllHome (AHM PM) claims to have pioneered the “one-stop-shop” home improvement retailer in the Philippines. AllHome plans to raise up to $404...

Arun George

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