Compiled by Claire Huang, The Business Times
MICRO-MECHANICS (HOLDINGS) LTD | BUY
TARGET PRICE: S$2.50
OCT 31 CLOSE: S$2.11
Phillip Capital, Oct 31
MMH revenue growth is closely tied to the industry semi-conductor sales cycle. We expect the current momentum in sales to sustain, in line with the current synchronised growth in global economies.
Visibility is never perfect for the semi-conductor cycle. But we take comfort that the current double-digit surge in semi-conductor sales began in earnest only in December 2016. So we at least have another quarter ahead of easier comps.
Furthermore, in the last two semi-conductor cycles, the positive year-on-year growth ran for 20 and 26 months.
The current cycle is only 13 months. Maintain "buy" rating with target price raised to S$2.50.
RAFFLES MEDICAL GROUP | BUY
TARGET PRICE: S$1.26
OCT 31 CLOSE: S$1.13
OCBC Investment Research, Oct 31
Raffles Medical Group's Q3-17 results were largely within our expectations. Revenue was up marginally by 0.3 per cent year- on-year to $119.6 million, forming 24.7 per cent of our full-year estimates.
Profit after tax and minority interests also came in within expectations, growing one per cent year-on-year to $16.4 million and forming 23.4 per cent of our full-year estimates.
We note that the constructions of the Chongqing and Shanghai projects are progressing according to plan, and are due to become operational by H2-18 and H2-19, respectively.
We note that management intends to take a measured and cost-disciplined approach with the Chongqing project, opening about 300 beds initially (with 100 catered for public patients), well below the 700-bed capacity.
Together with greater expected finance expenses arising from increased capital outlay, we trim our fair value estimate from $1.47 to $1.26.
ASCENDAS REIT | BUY
TARGET PRICE: S$2.97
OCT 31 CLOSE: S$2.74
UOB Kay Hian, Oct 31
Results are in line with expectations. Although business park rents in city fringe have turned around, factory and warehouse space are still facing supply-side challenges in Singapore.
Management seeks prudent expansion opportunities outside Singapore, with Australia proving to be an interesting market with similar risk/reward attributes.
After the abrupt resignation of Chia Nam Toon, Ascendas Reit is finding its next chief executive officer.
Maintain "buy" with an unchanged target price of S$2.97.
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