Compiled by Andrea Soh
CAPITALAND RETAIL CHINA TRUST | HOLD
SEPT 15 CLOSE: $1.615
TARGET PRICE: $1.59
OCBC Research, Sept 15
We note that CapitaLand Retail China Trust's (CRCT) sponsor, CapitaLand, has been actively advancing its offline-and-online (O&O) strategy.
We believe that this places CRCT in an advantageous position in the longer run as similar solutions may be replicated across its own portfolio.
Going forward, CRCT faces more than one positive DPU catalyst as well as the loss of income following its Anzhen divestment.
After updating our FY17 average yuan exchange rate from 1 yuan = 0.204 SGD to 1 yuan = 0.205 SGD, as well as tweaking our FY18 to FY20 currency assumptions, our fair value estimate increases from $1.55 to $1.59. Against yesterday's closing price, CRCT is currently trading at a 6.6 per cent FY17F dividend yield and a 7.1 per cent FY18F yield.
ELLIPSIZ LIMITED | NOT RATED
SEPT 15 CLOSE: $0.79
UOB Kay Hian, Sept 15
On Aug 21, Ellipsiz entered into a sale and purchase agreement to dispose of the probe card business for a total consideration of US$65 million (S$87.4 million).
With the sales proceeds, Ellipsiz should have a net cash position of $0.83/share, greater than its current share price.
The recent purchase of shares at $0.7525/share by Ellipsiz's CEO underlines confidence in the completion of the deal and we believe that there is a good chance part of the proceeds will be distributed.
AEM HOLDINGS | NOT RATED
SEPT 15 CLOSE: $2.39
Maybank Kim Eng, Sept 14
AEM specialises in backend semi-con equipment and components manufacturing.
Notably, it has spent the past four years restructuring the company and co-developing the latest test handler for Customer I's (a US$170 billion market cap chipmaker) high density modular test (HDMT) platform.
AEM believes that few or none of current test handlers can rival its latest specs.
This handler is an integral part of the HDMT, which has helped Customer I achieve up to double its intended cost savings.
AEM aims to replace a substantial portion of Customer I's test handlers over the next three years.
Looking ahead, profitability will be driven by higher-margin consumables sales.
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