Singapore

• We estimate SEA’s 4Q22 revenue to be largely in line with cons., while non-GAAP net loss to be narrower than cons. 
• We see SEA to continue to experience challenges in top-line growth because of inflation, competition with TikTok, and weak performance of Free Fire. Yet, the losses will be better managed.
• We slightly raise SE’s TP by 6% to US$55 to reflect 4Q22’s margin beat, yet maintain SELL because of the mid-to-long-term challenges.

• For H1FY23 Thomson Medical Group Limited (TMG SP)‘s revenue increased 27% to S$184M. The growth was mainly attributed to the increase in overall patient loads and higher average bill sizes.  
• Despite increase in operating expenses, Thomson Medical reported a 46% YoY increase in operating profit to S$45.2M, leading to 340 basis point improvement in operating profit margin to 24.6%.
• Thomson Medical expects its existing and new business lines to grow and is therefore cautiously optimistic of its business prospects in the current financial year.  

• The Sabana Industrial REIT (SSREIT SP) 2022H2 dividend went ex- on 6 February 2023, setting the Offer to be lowered. The Offer by Volare was lowered. Docs out Friday night.
• The S$0.465 Offer, adjusted for dividends (to be paid 27 March (cash or DRP units)), is now S$0.4504 per unit. The first close is 10 March 2023. 
• Sabana has underperformed a basket of slightly higher beta peers by 1+% since the day before the announcement. Watch pro-ration risk.

• Sabana Industrial REIT (SSREIT SP)’s partial offer from Volare to acquire a maximum of 109.6 million units at S$0.4504 per unit (S$0.465 in cash – S$0.0146 2H2022 distribution) is open.
• The offer is conditional on 10% minimum acceptances. Minorities appear willing sellers as both Volare and Quarz increased their unitholding over the last 12 months.  
• Quarz is supportive but its intentions are unclear. Based on a proration of 16.70% and at the last close of S$0.420 per unit, the breakeven price is S$0.415 per unit.

• Singapore-based Geolah – a mobility startup – wants to remove commission fees altogether.

• Instead of charging drivers commission fees, Singh said his startup will earn revenue through rebates from digital payments, insurance, and automotive firms. 

• Revenue will also come from ads, with the firm saying that it has onboarded notable names like Shell and Klook.

• VFlowTech, a vanadium-based redox flow (VRF) battery company in Singapore, has announced a US$10 million Series A funding round

• VFlowTech will use the funds to set up a 200MWh production line capacity and scale up the manufacturing of its 250 kWh modular vanadium-based long-duration energy storage solutions. 

• A portion of the new capital will be used to expand into Turkey, the US, Japan and India.

• The company has expanded to offer watch phones, headphones, drones, and even a social media network for kids.

• Their mission is to help kids aged between three and 12 to “stay connected socially without the usual ills of social media.”

• The startup’s revenue mainly comes from sales of its devices, ranging from a US$20 digital sketchpad to a US$199 watch phone. 

• Singapore-based PixCap, a web-based 3D design platform, has raised US$2.8 million in seed funding led by Sequoia Surge.

• Founded in 2020 by Cyril Nie (CTO) and Looi, PixCap allows users with no 3D experience to find, edit and export 3D content, including images for graphic designs and animations for landing pages and social media.

• Designers, developers and consumers can use PixCap to create 3D content for graphic designs, games and AR/VR.

• Last November I highlighted Haw Par Corp (HPAR SP)‘s multi-year trough levels on an implied stub valuation, and on an HPAR/UOB (UOB SP) ratio.
• That trade has panned out well as the ratio steadily increased. But it remains below the 200 MDA.
• A recovery in Tiger Balm sales is expected in Haw Par’s full-year results later this month.  UOB’s financials, and UOL (UOL SP)‘s, are also due out this month.

• Boustead Projects (BOCJ SP)/BPL has disclosed a voluntary unconditional offer from Boustead Singapore Limited (BOCS SP) at S$0.90 per share, a 7.8% premium to the undisturbed price (3 February).
• The offer price is unattractive in comparison to peer multiples, historical trading ranges and precedent transactions. However, the offer price is not final.
• As Boustead Singapore aims to privatise BPL there is a possibility of a bump. The offer document will be despatched and the offer opens by 27 February.

• A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Japan, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
• ECM developments – Pertamina Geothermal (0125738D IJ) launches a US$600 million IDX IPO and Hesai Group (HSAI US) launches a US$171 million Nasdaq IPO.
• Event-Driven developments Halcyon Agri (HACL SP), Toshiba Corp (6502 JP), Nissin Electric (6641 JP), Techno Associe (8249 JP), Pushpay Holdings (PPH NZ), Nitro Software Ltd (NTO AU), O2Micro International (OIIM US). 

In the upcoming webinar, AIMS APAC REIT’s (“AA REIT”) CEO, Mr Russell Ng, will share a short company presentation. After which, he will engage in a fireside chat with Smartkarma Insight Provider, Angus Mackintosh. The Corporate Webinar will include a live Q&A session.

AIMS APAC REIT (“AA REIT”) is a real estate investment trust listed on the Mainboard of the SGX-ST since 2007. The principal investment objective of AA REIT is to invest in a diversified portfolio of high quality income-producing logistics, business parks and industrial real estate throughout Asia Pacific. As at 30 September 2022, AA REIT’s portfolio consists of 29 properties, of which 26 properties are located throughout Singapore and 3 properties located in Australia (including a 49.0% interest in Optus Centre held through a joint venture), with assets under management of S$2.2 billion. AA REIT is also a constituent of the FTSE EPRA Nareit Global Developed Index and the MSCI Singapore Small Cap Index. 

AA REIT is managed by AIMS APAC REIT Management Limited, which is wholly-owned by AIMS Financial Group (“AIMS”). Headquartered in Sydney, AIMS is a diversified financial services and investment group, active in the areas of fund management, mortgage lending, investment banking and property investment. AIMS is also the owner of the Sydney Stock Exchange.

• As expected, all conditions to the Sinochem/China Hainan Rubber (601118 CH) SPA have now been satisfied, triggering a mandatory Offer for Halcyon Agri (HACL SP), conditional on a 50% tendering.
• Hainan Rubber holds 36%.  Sinochem has provided an undertaking notto tender its remaining 29.2% stake. Hainan needs 14% out of 34.8% available – or ~40% to tender. 
• The takeaway disappointment is the Offer Price of S$0.413/share, down from S$0.435 at the time of the initial announcement last November, due to SGD weakness. 

• There are 45 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
• Four new deal was discussed on Smartkarma this past week: tender offers for Kanematsu Electronics (8096 JP), Kanematsu Sustech (7961 JP), Nissin Electric (6641 JP), and Techno Associe (8249 JP).
• Key updates took place for: Sembcorp Marine (SMM SP), Pushpay Holdings (PPH NZ), Nitro Software Ltd (NTO AU), Toshiba Corp (6502 JP), and O2Micro International (OIIM US).

• In C4Q22, We expect Grab to report total revenue 2% higher than cons., and non-IFRS net loss narrower than cons.. 
• With competitors cutting back on heavy incentives, Grab has gained share under easing competitive environment in food delivery market in 2022. We expect this trend to sustain in 2023.
• Mobility is expected to benefit from rebound of tourism and generate stable margin. Pullbacks from off-platform financial services continue to support improvement. Maintain BUY and raise TP to US$ 4.0.

• The conditions precedent for China Hainan Rubber Industry (601118 CH) to acquire 36.00% of Halcyon Agri (HACL SP)’s outstanding shares from Sinochem International Corporation A (600500 CH) at US$0.315 is fulfilled. 
• This will trigger an MGO at US$0.315 or S$0.413. On the assumption that the offer document is despatched by 17 February, the earliest close of the offer is 17 March.
• The MGO has a 50%+ minimum acceptance condition which requires around 40% of minorities’ acceptance rate. We think that this is achievable as the offer is attractive. 

• Q & M Dental Group (Singapore) (QNM SP) is the largest listed pure dental play in Southeast Asia. For the 9M2022, core healthcare revenue increased 3% to S$125.9M.
• Comparison of the numbers over five quarters to mitigate any impact of changes in the economic and business environment shows core healthcare revenue exhibits a secular uptrend.
• During 9M2022, Q&M added seven and four dental clinics in Singapore and Malaysia, respectively, bringing the company’s total number of clinics to 106 in Singapore and 45 in Malaysia.