Maybank Kim Eng Research, June 5
Maintain a "positive" sector rating based on three investment themes: asset-light players who are able to consolidate the industry will capture better growth; established players who can replicate success overseas will tap into new growth opportunities; positive structural trends from an ageing population, rising affluence, and increasing prevalence of chronic diseases.
Top sector picks are Singapore Medical Group, Health Management International and Raffles Medical due to their rapid growth, better prospects overseas, and established bases.
However, we are mindful of the risks from: increasing regulations; slowing medical tourism; and intensifying competition. We also initiate "buy" on Health Management International with a target price of $0.84.
JUNE 6 CLOSE: US$1.785 (S$2.46)
TARGET PRICE: US$1.03
Citi Research, June 4
Mandarin announced that it is undertaking a review of its long-term strategic options with regard to The Excelsior, Hong Kong.
The sale of The Excelsior, if materialised, could be a game changer for the group.
With reference to Citi's valuation on Wharf's Times Square as a suitable comparable, we forecast the potential transaction could enhance our estimated net asset value by about US$0.82 per share to US$1.85, (an improvement of about 80 per cent).
However, we maintain our "sell" rating as the outcome of the management review is still uncertain at this time.
If the group continues to operate the asset as a hotel there will be no enhancement to NAV although the current share price appears to have pretty much factored in the transaction as a done deal.
JUNE 6 CLOSE: RM6.04 (S$1.94)
TARGET PRICE: RM6.84
CIMB Research, June 5
We believe mergers and acquisitions are on the cards in India. IHH has fully divested its 10.85 per cent Apollo stake, with the proceeds setting the stage for inorganic opportunities.
India currently only forms 6 per cent of group revenue but we think this will be much bigger five years later and become an important growth driver.
Media reports have linked IHH with Fortis, which makes sense given Fortis has one of the largest footprints in India and is apparently willing to cede management control.
Fortis or not, we believe IHH has M&A plans given that it is still relatively under-represented in India and management views India as a high growth market. Reiterate "add".
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