Singapore

• Share buybacks by primary listed companies 11 – 17 Aug 2023 Institutions were net buyers of Singapore stocks over the five trading sessions through to Aug 17, with S$256 million of net institutional inflow, while 21 primary-listed companies conducting buybacks with a total consideration of S$36 million.
• On Aug 15, QAF joint group managing director and executive director Lin Kejian acquired 450,000 shares at an average price of S$0.79 per share.

• 10 largest weights of the iEdge S-Reit Index THE FTSE EPRA Nareit Developed Index is designed to track the performance of listed real estate companies and real estate investment trusts (Reits) worldwide.
• The 10 largest weights of the iEdge S-Reit Index make up close to 70 per cent of the index weights.

• Airalo, an e-SIM marketplace, has secured US$60 million in a Series B investment round from a clutch of investors, its Co-Founder Ahmet Bahadir Ozdemir said in a LinkedIn post.
• The investors participating in the round are Etisalat’s e& capital, Liberty Global, Singtel Innov8, Orange Ventures, Deutsche Telekom’s T.Capital, KPN Ventures, and Telefonica.
• Existing investors Antler, Rakuten Ventures, Peak XV Partners’s Surge, and I2BF Global Ventures also joined.

• Sea (SE US) 2Q2023 results reflected some underlying slowdown but beneath the surface, the company’s core marketplace business saw accelerated growth, as it stepped up investment, and margins improved concurrently. 
• The company invested in live streaming, bringing on 1m influencers in 2Q2023, likely stemming the impact of TikTok. The gaming business showed meaningful signs of recovery QoQ in 2Q2023.
• Sea (SE US) grew its cash reserves in 2Q2023 to US$7.7bn signifying the success of its business model. The short-term sell-off looks overdone possibly triggered by talk of quarterly losses.

• Digital Entertainment Asset (DEA), a Singapore-based Web3 entertainment company, today announced that it has secured undisclosed funding from Global Brain Corporation’s KDDI Open Innovation Fund III.
• In a press statement, DEA co-founder and co-CEO Naohito Yoshida said that the company is “very proud” to announce its new investment and collaboration with Global Brain.
• “We look forward to working together with KDDI to offer various Web3 incentives to a wider audience, including the use of PlayMining assets in the αU metaverse and joint efforts to promote DEA’s ‘GameFi-for-Good’ social impact initiatives,” he said.

• While our outlook for Sea (SE US)‘s 2Q23 was bearish, we didn’t anticipate such a substantial price reaction post-earnings, considering the existing low consensus.
• However, the market appears to have given more importance to the revenue miss and the deterioration of fundamentals in e-commerce, as indicated by the post-earnings price reaction of -28.7%.
• Shopee’s modest profitability, restrained growth fail to warrant an EV surpassing $7.0bn. The Gaming business is best valued around $3.0bn, while the Fintech arm should be valued at around $5.0bn.

• Sea reported CY2Q23 top-line that missed consensus by 3.4%, while non-GAAP net income beat  by 16%. Sea guided for the net margin to turn negative again in future quarters.
• We see deterioration of Sea’s competitive landscape as a long-term trend, hence we cut TP to US$35. The next swing factor is Temu’s ASEAN launch.
• Yet, we need to remind investors that Sea’s 3Q earning might have some upside, including user growth of Shopee, as well as stabilization of gaming metrics.

• Although Mirxes has already commercialized its products, its total revenue fluctuated greatly. When the market demand for COVID-19 testing kits sharply declined, the Company’s financial position deteriorated immediately.
• With the highest incidence rate of gastric cancer worldwide, PRC market is important to Mirxes. How to gain recognition from doctors and enter hospital market is a challenge for GASTROClear.
• Mirxes is facing survival problem and eager for an IPO. Before Mirxes establishes a clear/visible path to commercialization and a successful profit model in post-COVID era, we would remain cautious. 

Continuum Green Energy has launched a roadshow to market USD 144A/RegS 3.5NC1.5 green bonds. The expected size is USD 450 mn. The proceeds are earmarked for: [1] refinancing the issuer’s outstanding USD 400 mn 2026 notes; [2] paying the first coupon of the proposed notes and transaction costs: and [3] capex for eligible green projects. The expected ratings on the notes and issuer are B+ (positive) by S&P and Fitch.

We view Continuum as “Medium Risk” on our LARA Scale. We like the company’s: [1] high exposure in healthier commercial & industrial customers with almost no receivables; [2] diversified customer portfolio; and [3] long-term PPA being benchmarked to various industrial tariffs. On the flip side, the credit is constrained by higher leverage compared to peers and has smaller scale. Our Credit Bias is “Positive”, considering the 1 GW of new capacity scheduled to be commissioned later this calendar year.

We believe the COGREN 27 should be priced to yield c. 8.5-8.75%.

• kopi-C with Procurri’s CEO: “It’s about every one of us doing a little for sustainability” Mat Jordan, Chief Executive Officer at Procurri shares how the company is championing sustainability practices.
• It’s Procurri’s commitment to eco-friendly business trends, passion for environmental issues and strict sustainability mission that keeps Mat invested.

• Singapore-based waste management company Blue Planet has secured an undisclosed sum in funding from Malaysian PE firm Bintang Capital Partners.
• The startup will utilise the capital to expand its operational teams and waste management technologies to pave the way for handling a broader range of waste types in current and emerging markets.
• Founded in 2017 by Madhujeet Chimni, Prashant Singh, and Bharadwaj Chivukula, Blue Planet provides waste collection, transportation, segregation, processing, and treatment services.

• Baskit, a startup that focuses on digitalising and growing distribution businesses in Indonesia’s supply chains, today announced that it had raised US$3.3 million in seed funding.
• The funding round comes from Betatron Venture Group, Forge Ventures, Investible, 1982 Ventures, DS/X Orvel, Michael Sampoerna, and other prominent global and regional angels.
• It followed a US$1.5 million pre-seed funding round that Baskit announced in March.

Yanlord Land’s H1/23 results were acceptable, in our view, with the company reporting strong top-line growth. That said, the gross margin contracted, as Yanlord delivered projects outside of Tier 1 cities. Still, cash collection was strong, which supported net debt reduction and deleveraging.

Going forward, the company faces material near-term debt maturities, including a USD 600 mn syndicated loan and the USD 376 mn YLLGSP 6.8 24 (both due February 2024). Our base case assumes that Yanlord can refinance its syndicated loan, and repay the USD bond using cash on hand. We also expect the company to continue rolling over its secured SGD loan.

Overall, Yanlord’s credit profile is underpinned by its clean debt structure and moderately sizeable portfolio of investment properties. This is as the company may be able to monetise its unencumbered investment properties in China and Singapore to raise funds. Management is exploring a CMBS issuance backed by Yanlord Landmark in Chengdu. In addition, Yanlord may be able to pledge the Yanlord Reverie Plaza in Shenzhen for bank financing, as the asset has reached more than 80% occupancy (since its soft opening in late 2022). Moreover, the company’s unencumbered investment properties in Singapore may be used as credit enhancement to support the offshore notes in the unlikely event of default.

• We remain bearish on Sea (SE US) leading upto Q2 results on 15th August 2023.
• Our analysis suggests Sea Ltd could hit around $3.25bn revenue in 2Q23, in line with consensus. However, profitability could fall short of consensus expectations.
• Nonetheless, any downside stemming from a minor earnings shortfall could be rather limited given the existing low consensus and the lackluster price performance leading up to the Q2 earnings announcement.

• Share buybacks by primary listed companies 4 – 10 Aug 2023 Institutions were net buyers of Singapore stocks over the four trading sessions through to Aug 10, with S$136 million of net institutional inflow, with eight primary-listed companies conducting buybacks with a total consideration of S$7.7 million.
• The previous mandate saw the company buy back 14,250,100 of its shares which represented 2.12 per cent of its total number of issued shares (excluding treasury shares).

• THE first seven months of 2023 saw the iEdge S-Reit Index gain 3.9 per cent in total return terms, reversing its 11.9 per cent decline in 2022.
• This was followed by hospitality S-Reits with 5.8 per cent average total returns, after being the best performing sub-segment last year.
• PLife Reit declared a distribution per unit (DPU) of 7.29 Singapore cents for H1 2023, representing an increase of 3.3 per cent year on year.

• There is no refuting the strong net interest income figures at DBS, although it seems toppy
• DBS took credit costs/assets at 4bps in 2Q23 vs 13bps average during FY18, FY19 quarterly
• There are not many banks that we can turn too with over 50% QoQ decline in credit costs

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Yanlord Land

• In terms of net fund flows over the month, retail investors net bought S$8.2 million of S-Reits while institutional investors net sold S$86.4 million in the sector.
• However, there were 10 S-Reits and property trusts which recorded net institutional inflows in the month of July.
• They were Keppel DC Reit, CapitaLand Integrated Commercial Trust (CICT), CapitaLand India Trust (Clint), ESR-Logos Reit, Far East Hospitality Trust, Digital Core Reit, Paragon Reit, Sasseur Reit, First Reit, and BHG Retail Reit.

• Share buybacks by primary listed companies 28 Jul – 3 Aug 2023 Stocks that booked the highest net institutional outflow over the five sessions included Singapore Airlines, Frasers Logistics & Commercial Trust, Genting Singapore, Jardine Matheson, CapitaLand Investment, Venture Corporation, Mapletree Pan Asia Commercial Trust, Suntec Reit and Sheng Siong Group.
• There were four primary-listed companies conducting share buybacks over the five trading sessions through to Aug 3 with a total consideration of S$11.4 million.