Business

Brokers' take

Compiled by Claire Huang,
The Business Times

MICRO-MECHANICS (HOLDINGS) LTD | BUY

TARGET PRICE: S$2.50
OCT 31 CLOSE: S$2.11

Phillip Capital, Oct 31

MMH revenue growth is closely tied to the industry semi-conductor sales cycle. We expect the current momentum in sales to sustain, in line with the current synchronised growth in global economies.

Visibility is never perfect for the semi-conductor cycle. But we take comfort that the current double-digit surge in semi-conductor sales began in earnest only in December 2016. So we at least have another quarter ahead of easier comps.

Furthermore, in the last two semi-conductor cycles, the positive year-on-year growth ran for 20 and 26 months.

The current cycle is only 13 months. Maintain "buy" rating with target price raised to S$2.50.

RAFFLES MEDICAL GROUP | BUY

TARGET PRICE: S$1.26
OCT 31 CLOSE: S$1.13

OCBC Investment Research, Oct 31

Raffles Medical Group's Q3-17 results were largely within our expectations. Revenue was up marginally by 0.3 per cent year- on-year to $119.6 million, forming 24.7 per cent of our full-year estimates.

Profit after tax and minority interests also came in within expectations, growing one per cent year-on-year to $16.4 million and forming 23.4 per cent of our full-year estimates.

We note that the constructions of the Chongqing and Shanghai projects are progressing according to plan, and are due to become operational by H2-18 and H2-19, respectively.

We note that management intends to take a measured and cost-disciplined approach with the Chongqing project, opening about 300 beds initially (with 100 catered for public patients), well below the 700-bed capacity.

Together with greater expected finance expenses arising from increased capital outlay, we trim our fair value estimate from $1.47 to $1.26.

ASCENDAS REIT | BUY

TARGET PRICE: S$2.97
OCT 31 CLOSE: S$2.74

UOB Kay Hian, Oct 31

Results are in line with expectations. Although business park rents in city fringe have turned around, factory and warehouse space are still facing supply-side challenges in Singapore.

Management seeks prudent expansion opportunities outside Singapore, with Australia proving to be an interesting market with similar risk/reward attributes.

After the abrupt resignation of Chia Nam Toon, Ascendas Reit is finding its next chief executive officer.

Maintain "buy" with an unchanged target price of S$2.97.

Disclaimer: All analyses, recommendations and other information herein are published for general information. Readers should not rely solely on the information published and should seek independent financial advice prior to making any investment decision. The publisher accepts no liability for any loss whatsoever arising from any use of the information published herein.