Business

Brokers' take

Compiled by Kenneth Lim

SEMBCORP INDUSTRIES | ADD

AUG 4 CLOSE: $3.18

TARGET PRICE: $3.47

CIMB Research, Aug 4

Investors would need to wait until Q4 2017 to hear of the final outcome of Sembcorp Industries' strategic review.

We stick to our view that taking Sembcorp Marine (SMM) private is not feasible. Divestment (to whom is a question) and dividend in specie to its shareholders may not be a sweet deal for main shareholder (Temasek), with SMM's highly geared position amid unsettled restructuring and ongoing corruption investigation in Sete Brasil.

Share price may be weighed down temporarily by management's comments on the two-to-three-year wait for a power purchase agreement for Sembcorp Gayatri Power Ltd.

BANYAN TREE HOLDINGS | BUY

AUG 4 CLOSE: $0.59

TARGET PRICE: $0.77

Phillip Securities Research, Aug 4

Strategic partnerships signed with China Vanke and AccorHotels offer divestment gains, new management fee income and fresh capital for Banyan Tree.

Potential 9 cents per share gain on disposal of China assets provides upside to dividends.

Pipeline of potential hotel openings with Accor can almost double Banyan Tree's hotel network from the current 40 to 76.

Initiate coverage with "buy" rating and $0.77 target price, implying a 36 per cent upside.

DAIRY FARM INTERNATIONAL HOLDINGS | BUY

AUG 4 CLOSE: US$7.72

TARGET PRICE: US$10.00

RHB Research, Aug 4

Dairy Farm announced its H1 FY17 results yesterday evening

Its H1 FY17 profit after tax and minority interests grew 7 per cent to US$213 million, which was largely in line with consensus' expectations.

Its health & beauty and convenience stores were the star performers... While the home furnishing division continued to deliver steady results.

Unfortunately, these were partially offset by the weaker-than-expected revenue from the supermarket division. Our call is "buy", with target price of US$10.00 (24 per cent upside).


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