Daily Morning Note – 12 November 2018


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Asian stocks kicked off the week with declines following a weak U.S. session on Friday. The pound slipped as U.K. Prime Minister Theresa May fought to keep her Brexit divorce plan alive.

Shares fell in Japan, Australia and South Korea. Futures trading from late Friday pointed to declines in Hong Kong. That’s after large-cap tech stocks dragged the Nasdaq 100 Index to a loss of more than 1.5 percent.

Oil prices snapped a 10-day sell-off after the bear market for crude spurred OPEC and its allies to start laying the groundwork to cut supply in 2019. Yields on 10-year Treasuries, which don’t trade Monday thanks to a U.S. holiday, ended just below 3.2 percent on Friday.


SIA Engineering Company Ltd – Saved by associated and joint-venture companies
Recommendation: NEUTRAL (downgraded)

Target Price: S$2.81

– 1H revenue and PATMI were 4.5% and 13.6% lower respectively than our estimate

– Lower 1H EBIT was completely offset by higher associates/JVs

– 3 cents interim dividend declared, lower than last year’s 4 cents

– Downgrade to Neutral, new target price of $2.81 (previously $3.56) as we cut our FY19e and FY20e earnings estimate by 16% and 14%

ComfortDelGro Corp Ltd – Big ticket acquisition and fund investment
Recommendation: BUY (upgraded)

Target Price: S$2.69

– Revenue and PATMI were within our expectation

– Proposed acquisition of Buslink (Australia) and set up of corporate venture capital fund

– Upgrade to BUY; new target price of S$2.69 (previously $2.78) as we raise our assumptions for staff, repair and maintenance costs


The Singapore Exchange Regco is proposing changes to the voluntary delisting rules, which, if adopted, will shift the voting power play from offerors and concert parties to minority and independent shareholders and potentially compel a sweeter exit proposition.

KrisEnergy has awarded a contract for flagship Cambodia oil project to Keppel Shipyard Ltd.

Roxy-Pacific has entered into an agreement to acquire a property at 33 Argyle Street, Parramatta NSW, Australia.

Profit guidance: Hor Kew Corporation Limited expects to record a loss for the third quarter ended 30 September 2018.

Profit guidance: United Food Holdings Limited expects to report profit after tax for 3Q2018 and 9M2018 as compared to loss for the previous corresponding periods.

Nordic Group Limited has secured approximately S$29.1 million worth of contracts.

Oxley Holdings announced the sale of No. 2 Dublin Landings in Ireland.

Trendlines Medical Singapore and A*ccelerate establish partnership to jointly develop and commercialise medical technologies.

Source: SGX Masnet, Bloomberg, Reuters, The Business Times, Channel NewsAsia, Phillip Securities Research

Clients of Phillip Securities can keep updated with Country Strategy and Singapore Sector Reports by logging into: www.poems.com.sg > STOCKS > Research

Read the research report(s), available through the link(s) above, for complete information including important disclosures

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