DBS GROUP HOLDINGS | ACCUMULATE
TARGET PRICE: $21.45
SEPT 18 CLOSE: $20.49
Phillip Securities Research, Sept 18
We had initially thought the positive sentiments and low volatility post-Trump's election will be temporary but as it appears, a sustained synchronous global recovery is gaining momentum.
Therefore, we could continue to see positive loan rates and volume dynamics in H2 2017 and early 2018 that will drive net interest income higher.
Even though DBS has the highest loan-to-deposit ratio, which gives it the least headroom to grow loans faster than deposits, it is our top pick because it has the highest Singapore current and savings account ratio to total deposits ratio of 91 per cent and the largest overall deposit base of $342.9 billion.
This means United Overseas Bank and OCBC Bank will not be able to lend as much cheap loans as DBS. We believe this is the competitive edge DBS has over its peers.
SATS | HOLD
TARGET PRICE: $5.05
SEPT 18 CLOSE: $4.75
OCBC Investment Research, Sept 18
With encouraging visitor arrivals to Singapore and strong traffic statistics at Changi Airport for January to July 2017, we believe Sats will benefit as a provider of gateway services and food solutions for close to 80 per cent of Changi Airport's traffic throughput.
That said, passenger yields remain weak for the airline industry, which translates to pressure on Sats' margins as its airline customers will likely engage in cost management efforts, especially for its low-cost carrier customers.
But, the changes Qantas will be making to its collaboration with Emirates will add capacity at Changi Airport and we expect these changes to be positive for traffic growth at Changi Airport.
RAFFLES MEDICAL GROUP | ADD
TARGET PRICE: $1.21
SEPT 18 CLOSE: $1.115
CIMB Research, Sept 17
Raffles Medical's share price has corrected about 27 per cent year-to-date.
We now think it looks more attractive in terms of risk-reward.
Upgrade from "reduce" to "add" with sum of parts-based target price of $1.21... Growing pains for new hospitals in China are inevitable, but a home-field advantage could help to offset near-term overseas weakness.
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