Daily Morning Note – 18 Aug 2020


Stocks in Asia Pacific were set for a lower start as the S&P 500 stateside rose to a new record overnight. Futures pointed to a lower open for Japanese stocks. The Nikkei futures contract in Chicago was at 23,050 while its counterpart in Osaka was at 23,040. That compared against the Nikkei 225′s last close at 23,051.08. Overnight on Wall Street, the S&P 500 erased its coronavirus losses as it rose to an all-time high. The broader market index advanced 0.2% to 3,389.78, a record close. It also touched an intraday all-time high, reaching 3,395.06 earlier in the trading day stateside. The Nasdaq Composite also hit a record, gaining 0.7% to finish its trading day at 11,210.84. The Dow Jones Industrial Average shed 66.84 points, or 0.2%, to close at 27,778.07.


Singapore Press Holdings (SPH) will shed about 140 jobs, or 5 per cent of the media group’s headcount, as it restructures its media sales and magazine operations. The exercise comes as the group seeks to transform its media business and as it grapples with declining advertising revenue owing to the Covid-19 pandemic.

Myanmar-focused conglomerate Yoma Strategic Holdings on Tuesday reported that its group revenue rose by 3.2 per cent to US$19.2 million for the quarter ended June 30, 2020, from US$18.6 million a year ago. The boost to the top line came largely from its real estate development business as well as the motors arm, according to the mainboard-listed firm’s trading update released on Tuesday morning.

Fitch Ratings on Tuesday revised its outlook to negative from stable for Ascott Real Estate Investment Trust (Ascott Reit), one part of mainboard-listed stapled group Ascott Residence Trust (ART). The credit ratings agency also affirmed the real estate investment trust’s (Reit) long-term issuer default rating at BBB, its BBB senior unsecured debt rating, as well as the BBB long-term ratings on its S$2 billion multicurrency medium-term note programme and the outstanding senior unsecured notes under the programme.

StarHub said it is giving customers on its new Mobile+ and Biz+ mobile plans early 5G access, starting Aug 18. Customers on the plans will be able to automatically experience some early 5G benefits when they are on compatible mobile devices. This includes being able to “stream, game and surf super smoothly and reliably”, the telco announced on Monday.

Catalist-listed Spackman Entertainment Group on Tuesday entered into a non-binding memorandum of understanding (MOU) to sell its entire 43.9 per cent stake in entertainment talent agency Spackman Media Group to Spackman Equities Group for at least 27.9 million South Korean won (S$32.2 million).

OCBC Bank has launched a new Sora-based home loan, which references the three-month compounded Singapore overnight rate average (Sora) that is published by the Monetary Authority of Singapore (MAS). The three-month Compounded Sora Home Loan is available for all loan types – completed properties, properties under construction, new home loans and repricing of existing home loans.

Travellers from nine new cities, including three South-east Asian countries, will now be allowed to transit through Singapore, the Singapore Airlines (SIA) group announced on Tuesday, in its latest round of approvals. The three countries are: Thailand, Malaysia and Indonesia.

Source: SGX Masnet, The Business Times, Bloomberg, Channel NewsAsia, Reuters, PSR


Riverstone Holdings Ltd

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

Riverstone Holdings (SGX: AP4) bullish strength has continue to soar above expectation and it is set to continue based on the wave and technical analysis.

>> Read more technical reports


Singapore Telecommunications Ltd – No respite expected in 2020

Recommendation: NEUTRAL (Maintained), Last Done: S$2.35

Target Price: S$2.44, Analyst: Paul Chew

– 1Q21 revenue and EBITDA were below expectations. Group revenue and EBITDA is down 14% and 24% YoY respectively.

– Australia consumer experienced the sharpest contraction, EBITDA down almost 34% YoY. Loss in on-net broadband customers by 65% to NBN hurts margins.

– Singapore mobile service revenue down 27%, in line with blended ASPs collapsing 27%,

– FY20 final dividend was cut by 49% to 5.45 cents. No earnings guidance provided for FY21.

– Maintain NEUTRAL with unchanged TP of S$2.44. We are keeping our FY21e PATMI estimates unchanged. We do not see a turnaround in the results until international travel resumes materially for roaming revenue to recover. Australia needs to complete its NBN transition and remove the significant cost of running its existing broadband network to expect any recovery.

Centurion Corporation Limited – Stable So Far (Credit View)

Credit Analyst: Timothy Ang

– 1Q21 revenue and EBITDA were below expectations. Group revenue and EBITDA is down 14% and 24% YoY respectively.

– Impact of COVID-19 showed in 2Q20, hitting PBSA segment the hardest.

– The group’s balance sheet remains healthy with adequate buffers and gearing stable at 54.1% from 54.5% in 4Q19.

– EBIT margins fell to 51.4% from 54.9% in 1H19 from higher expenses and provisions for rent receivables.

– We are Neutral on the CENSP 22NC21 as we continue to monitor the impact of COVID-19 on the group. We think the bond is an interesting short tenor play with a call date on 1 Feb 2021 and will step-up 2.5% if not called.

Phillip Model Bond Portfolio – Launch

Credit Analyst: Timothy Ang

– We launch our Phillip Model Bond Portfolio consisting of a list of 10 wholesale corporate bond picks (minimum denominations of S$250k) for fixed income investors.

– Our bond picks are diversified across issuers with resilient credit profiles to weather downturns. There is a balanced mix of 5 bullet bonds and 5 perpetual bonds.

– The portfolio will be reviewed on a monthly basis. It has an overall yield of 4.248% with an equal weighting across all bonds.

>> Read more research reports

HK Reports – Read up on our Hong Kong reports here


Webinar Of The Week

Market Outlook: Market Outlook: (PSR) UOB, DBS, OCBC, Manulife US, Prime US, Koufu, SG Bonds, CDL, APTT, StarHub and more

Date: 17 August 2020

For more on Market Outlook

Phillip Research in 3 minutes: #25 – Prime US REIT; Initiation

For more videos on Phillip in 3 Mins

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

The information contained in this email and/or its attachment(s) is provided to you for information only and is not intended to or nor will it create/induce the creation of any binding legal relations. The information or opinions provided in this email do not constitute an investment advice, an offer or solicitation to subscribe for, purchase or sell the e investment product(s) mentioned herein. It does not have any regard to your specific investment objectives, financial situation and any of your particular needs. Accordingly, no warranty whatsoever is given and no liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of this information. Investments are subject to investment risks including possible loss of the principal amount invested. The value of the product and the income from them may fall as well as rise. You may wish to seek advice from an independent financial adviser before making a commitment to purchase or investing in the investment product(s) mentioned herein. In the event that you choose not to do so, you should consider whether the investment product(s) mentioned herein is suitable for you. PhillipCapital and any of its members will not, in any event, be liable to you for any direct/indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials attached to this email. The information and/or materials provided 揳s is?without warranty of any kind, either express or implied. In particular, no warranty regarding accuracy or fitness for a purpose is given in connection with such information and materials.
Confidentiality Note
This e-mail and its attachment(s) may contain privileged or confidential information, which is intended only for the use of the recipient(s) named above. If you have received this message in error, please notify the sender immediately and delete all copies of it. If you are not the intended recipient, you must not read, use, copy, store, disseminate and/or disclose to any person this email and any of its attachment(s). PhillipCapital and its members will not accept legal responsibility for the contents of this message. Thank you for your cooperation.


Contact us to Open an Account

Need Assistance? Share your Details and we’ll get back to you