HUTCHISON PORT HOLDINGS TRUST (HPHT) | HOLD
JUNE 19 CLOSE: US$0.445 (S$0.62)
TARGET PRICE: US$0.42
OCBC Investment Research, June 19
Hutchison Port Holdings Trust (HPHT) saw a spike in trading volumes and unit prices late last week, perhaps due to recent upward revisions in forecasts for global throughput volume by industry watchers such as Drewry and Alphaliner.
The unit price rallied 5.9 per cent last Thursday alone, and last week's trading volume stands at 161.5 million units, compared to an average of 50.1 million units/week in the prior 10 weeks. After looking closer at Hong Kong and Shenzhen throughput data points and keeping tariff pressure in mind, we keep our forecasts for HPHT.
ASCENDAS HOSPITALITY TRUST | BUY
JUNE 19 CLOSE: $0.82
TARGET PRICE: $0.88
DBS Group Research, June 10
ASCHT's share price has largely tracked the performance of other Singapore-focused hospitality Reits which have faced the challenge of an oversupplied market although about 87 per cent of the trust's FY17 NPI are sourced outside Singapore. In addition, the contribution from its sole Singapore property is largely derived from a fixed rental income stream.
Thus, we believe there is an opportunity for investors to gain exposure to the growing Australian and Japanese hospitality markets at attractive valuations.
With gearing of only about 32 per cent, ASCHT is in a strong financial position to pursue debt-funded acquisitions.
In addition, we believe the ability to execute on non-organic opportunities is enhanced by having Miguel Ko as chairman of ASCHT. Mr Ko, who is currently the CEO of ASCHT's sponsor, was formerly the chairman and president of Starwoods Hotels & Resorts (Asia Pacific Division) and Deputy Chairman and CEO of CDL Hotels International.
UNI-ASIA GROUP LIMITED | BUY (INITIATION)
JUNE 19 CLOSE: $1.21
TARGET PRICE: $1.92
Uni-Asia had completed its recent restructuring exercise on June 2, which changed its place of incorporation from Cayman Islands to Singapore.
With this, the group can now focus on riding the improving fundamentals in all three business segments.
Uni-Asia generates 90 per cent of its revenue from recurring sources including charter fees and hotel income. Growth will come from (i) a dry bulk shipping recovery, (ii) completion of its second Hong Kong property which we estimate would yield a US$5 million profit this year and (iii) increase in hotel rooms under operations ahead of two major sporting events in Japan.
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.