SABANA SHARI'AH COMPLIANT REIT | TRADING BUY
TARGET PRICE: S$0.54
MAY 11 CLOSE: S$0.46
PhillipCapital, May 11
The manager waives 75 per cent of base fee to cushion dilutive effect on distribution per unit (DPU). Proposed acquisition of property from sponsor has been terminated. Resignation of chief executive/executive director, following unitholders' feedback for change. Reiterate our "trading buy" call and unchanged target price of S$0.54.
BEST WORLD INTERNATIONAL | ADD
TARGET PRICE: S$3.05
MAY 11 CLOSE: S$2.84
CIMB Research, May 11
First quarter FY17 net profit (+63.1 per cent year-on-year) blew past expectations at 24 per cent of our FY17 forecast (Q1 is seasonally weaker, only formed 17 per cent of FY16 net profit).
Key positive: China did extremely well (Q1 sales +103 per cent year-on-year).
We lift our FY17-19 forecast earnings per share (EPS) by 2-3 per cent on the back of this stronger sales momentum.
The only dampener was slightly weaker sales in Taiwan but we are not overly concerned and expect a recovery next quarter. Our target price rises to S$3.05 on our EPS upgrades. Maintain "add".
DELFI LTD | HOLD
TARGET PRICE: S$2.21
MAY 11 CLOSE: S$2.26
OCBC Investment Research, May 11
Its Q1 2017 revenue was down 10.1 per cent year-on-year to US$93.1 million while profit after tax and minority interests (Patmi) was a tad lower than expected, declining 33 per cent to US$5.6 million.
Management expects FY17 financial performance to be similar to FY16, barring unforeseen circumstances. We revise our estimates and roll forward to 30 times blended FY17/18 forecast price-to-earnings ratio, resulting in a fair value estimate of S$2.21 (previous: S$2.37).
SINGAPORE PROPERTY | NEUTRAL
Maybank Kim Eng, May 10
We believe surprise changes to the property cooling measures have positive implications for Singapore's residential market.
Relief from changes to the seller's stamp duties could nudge the marginal buyer concerned with potential penalties to buy a new property. This could have positive impact on sales volumes and prices.
However, we believe the market should curb enthusiasm as home buying demand will remain constrained by the ABSD (additional buyer's stamp duty), LTV (loan-to-value ratio) and TDSR (total debt servicing ratio) requirements. At the margin, we see upside risks to home sales volume and price assumptions.
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