Category

Singapore

Feb 24
0

Singapore: Sea Ltd, OCBC and more

By | Daily Briefs, Singapore

In today’s briefing:

  • SEA 110/102 Buy Zone
  • Oversea Chinese Banking Corp.- Another Weak Print

SEA 110/102 Buy Zone

By Thomas Schroeder

  • SEA has undergone a severe decline but is showing some light at the end of the falling wedge tunnel with physical support approaching near the 110/102 zone.
  • RSI compelling bull divergence stands out  as the upside energy driver. Align a buy entry with noted support at the 20-25 level that should nail down divergence.
  • 170 is our initial recovery target if the 100 level holds.

Oversea Chinese Banking Corp.- Another Weak Print

By Thomas J. Monaco

  • OCBC reported 4Q21 net profit of SGD 973 mn, declining 20.5% linked quarter, as a result of an increase in loss provisions and higher costs; 
  • Were it not for the 51.8% decline in Singapore NPLs, credit quality would have been disastrous for OCBC with credit falling off of a cliff regionally; and 
  • Given the increase in net new NPLs, reserves would appear to now be wanting by SGD 2.8 bn plus or nearly three quarters of bottom-line results.

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Feb 23
0

Singapore: Mapletree Commercial Trust and more

By | Daily Briefs, Singapore

In today’s briefing:

  • SIAS Also Questions MCT/MNACT Merger, Countering/Supporting Quarz

SIAS Also Questions MCT/MNACT Merger, Countering/Supporting Quarz

By Travis Lundy

  • Quarz wrote an open letter questioning the Mapletree North Asia Commercial Trust (MAGIC SP) deal with MCT for MNACT shareholders, discussed here. They wrote another letter last Thursday.
  • Now, Securities Investors Association (Singapore) SIAS has come out with an open letter to MCT management questioning the deal. 
  • There are now activists on both sides questioning this deal. That is not necessarily a bad thing. 

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Feb 22
0

Singapore: Grab and more

By | Daily Briefs, Singapore

In today’s briefing:

  • GRAB New Low in Store for a Basing Process – Where We like Buying.

GRAB New Low in Store for a Basing Process – Where We like Buying.

By Thomas Schroeder

  • GRAB exhibits overhead sell pressure with a new low in sight. Basing for a key low as selling pressure diminishes and the stage sets up for a cycle trough.
  • RSI bull divergence (squeezing out latent sellers, as sell volumes/ downside momentum diminish). RSI near sub 30 should set up a key low as a counter marker.
  • Ping the long side near 4.60, a weak bounce would place an emphasis on the 4.0 ideal low projection. 7.55/64 is the level to clear for bull traction.

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Feb 17
0

Singapore: Bumitama Agri, Raffles Medical and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Bumitama Agri: Lagging CPO Price Action; Large Special Dividend Possible at FY21 Results Briefing
  • Raffles Medical (RFMD SP) – Pivot in SG Travel Rules, Testing Regime and Its Implications

Bumitama Agri: Lagging CPO Price Action; Large Special Dividend Possible at FY21 Results Briefing

By Nicolas Van Broekhoven

  • Bumitama Agri (BAL SP) is a pure-play CPO play on SGX which like the rest of its peers has lagged the price of CPO by a mile.
  • What could be the catalyst to change this? We preview FY21 results which will be announced on 28th February and its dividend outlook going into FY22.
  • BAL should take a page from the Geo Energy Resources (GERL SP) playbook and start to pay out aggressive bi-annual dividends to get Mr. Market’s attention.

Raffles Medical (RFMD SP) – Pivot in SG Travel Rules, Testing Regime and Its Implications

By Jason Yap, CFA

  • Singapore will apply streamlined COVID-19 rules from 25 February 2022, with a focus on vaccination status instead of an aggressive testing and surveillance regime 
  • We previously discussed how Raffles Medical benefits as the primary testing services provider at Changi airport and by facilitating Singapore’s vaccination drive
  • Given the latest pivot in border protocols, and taking into account Singapore’s high vaccination rates, we discuss whether our initial investment hypothesis remains intact

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Feb 16
0

Singapore: Sea Ltd, Mapletree North Asia Commercial Trust and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Sea Ltd (SE US) – A Himalayan Saga
  • Sea Ltd in Free Fall Following the Removal of Free Fire from The App Store & Google Play
  • MCT and MNACT’s Options for Dealing with Quarz’s Campaign

Sea Ltd (SE US) – A Himalayan Saga

By Angus Mackintosh

  • The spotlight is back on Sea Ltd (SE US) after its game FreeFire was named as one of 54 apps of Chinese origin to be banned in India.
  • The ban on FreeFire comes despite Sea Ltd‘s recent move to reduce the influence from Tencent by scaling back its ownership of voting shares 
  • We see the recent price weakness as an opportunity to accumulate Sea Ltd given the growth story remains intact although investors may not pay the same multiple premium over peers.

Sea Ltd in Free Fall Following the Removal of Free Fire from The App Store & Google Play

By Oshadhi Kumarasiri

  • Sea Ltd dropped 18% yesterday following India’s decision to ban its battle royale game, Free Fire and 53 other Chinese apps from the Google Play and App Store in India.
  • India’s Free Fire ban could deliver a double whammy to Sea Ltd (SE US) with lower Digital Entertainment profitability limiting Sea’s ability to bankroll Shopee’s expansion.
  • With the macro-outlook for growth stocks not looking great, we wouldn’t be surprised to see “Sea” breaking the bottom end of the EV/Sales range towards the end of the year.

MCT and MNACT’s Options for Dealing with Quarz’s Campaign

By Arun George

  • Quarz Capital’s open letter urges Mapletree North Asia Commercial Trust (MAGIC SP)’s (MNACT) board to protect unitholders’ interest and negotiate for a higher offer from Mapletree Commercial Trust (MCT SP).
  • MCT has three options – keep the terms unchanged, improve the terms or support MNACT’s board benchmarking the merger vs alternative transactions.   
  • MCT’s likely move is to keep terms unchanged and seek shareholder approval. MNACT’s board can appease unitholders by exploring alternative transactions.   

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Feb 10
0

Singapore: Grab and more

By | Daily Briefs, Singapore

In today’s briefing:

  • MSCI Feb 2022 Index Rebalance: Day 1 Chosen Again

MSCI Feb 2022 Index Rebalance: Day 1 Chosen Again

By Brian Freitas

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Feb 07
0

Singapore: Mapletree Commercial Trust, Singapore Press Holdings, SGX and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Mapletree Commercial Trust – Heads I Win Tails I Win?
  • SPH Shareholders – A Good Deal For Waiting (After a Good Deal of Waiting)
  • Singapore Exchange – No Real Progress

Mapletree Commercial Trust – Heads I Win Tails I Win?

By Travis Lundy

  • Then-Underperforming Mapletree Commercial Trust (MCT SP) and Mapletree North Asia Commercial Trust (MAGIC SP) announced a merger on the last day of 2021. Then it underperformed some more.
  • The price uplift for MAGIC unitholders was lost. FYQ3 Earnings announced in late January were good for both (better for MNACT), but MCT is still underperforming the sector.
  • That seems to set MCT buyers up for a Heads I Win Tails I Win scenario.

SPH Shareholders – A Good Deal For Waiting (After a Good Deal of Waiting)

By Travis Lundy

  • The Combination Cuscaden – Keppel Scheme Offer Meetings for Singapore Press Holdings (SPH SP) shareholders should come imminently.
  • Time has passed and that should be worth something. Astute shareholders have likely already made their feelings known. Everyone should. 
  • In the meantime, there is a good spread, with a put option on a portion of it, and the possibility of a little upside. 

Singapore Exchange – No Real Progress

By Thomas J. Monaco

  • SGX FY 1H22 core results were not robust, coming in at SGD 216 mn, improving just SGD 1.0 mn (0.5%) HOH and reflected weakened revenues; 
  • Derivatives revenue improved 3.4% HOH, resultant of slightly higher contract volumes, and higher rates and lower discounts. HKEX’s foray into the A50 will ultimately eat away at SGX’s business; and
  • Significant strategic alternatives are needed at SGX, if it is to avoid being hollowed out by the HKEX.

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Feb 06
0

Singapore: iFAST and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Digital Bank Ambitions – IFast (IFast SP)’s Acquisition of BFC Bank and Balance Sheet Implications

Digital Bank Ambitions – IFast (IFast SP)’s Acquisition of BFC Bank and Balance Sheet Implications

By Jason Yap, CFA

  • On 7 January 2022, iFAST (IFAST SP) announced its planned acquisition of BFC Bank, a fully licensed UK bank, from Bahrain based group BFC Group for £40 million investment sum
  • The acquisition, which enables the group to add a full service bank to its fintech eco-system, is part of IFAST’s 5 year plan to have a global business model
  • We highlight the key terms of the transaction and associated balance sheet impact with respect to post acquisition capital structure and asset performance

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Feb 05
0

Singapore: Sea Ltd and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Sea Limited – Too Early To Call For The Bottom

Sea Limited – Too Early To Call For The Bottom

By Moat Investing

  • In our last update, the stock was around $250, and we called for a reality check in progress which might have led to a sharp revision in the price.
  • We were right! As of 1st February 2022, the stock is trading at $150 per share and is 40% down since our last update on December 10th, 2021.
  • This is a clear signal that analysts were overoptimistic, and we believe they will continue adjusting estimates over the next quarters. SE is still going through a reality check which might not be yet over.

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Feb 04
0

Singapore: Keppel DC REIT and more

By | Daily Briefs, Singapore

In today’s briefing:

  • Keppel DC REIT (KDCREIT SP) – Imminent Lifting of SG Data Centre Moratorium and Its Implications

Keppel DC REIT (KDCREIT SP) – Imminent Lifting of SG Data Centre Moratorium and Its Implications

By Jason Yap, CFA

  • Singapore government introduced a moratorium on new data centres in 2019
  • As result, incumbent data centre REITs recalibrated their portfolio strategy including to pursue DPU and NAV growth through accretive overseas acquisitions 
  • In Q2 2022, the moratorium is expected to be lifted with conditional approvals for applicants that meet certain sustainability requirements. We discuss the implications for Keppel DC REIT (KDCREIT SP) 

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