Daily Morning Note – 21 January 2019

WEEKLY MARKET OUTLOOK WEBINAR

Register HERE for MONDAY’s 11.15am webinar.

Archived webinars available.

YOUR PHILLIP SUMMARY

Asian stocks looked set to kick the week of on positive footing amid optimism steps are being taken toward a U.S.-China trade truce.

Shares in Australia climbed, following late Friday gains for equity futures in Japan and Hong, after the S&P 500 Index advanced to the highest level since Dec. 6. In the latest sign the two sides are eager for a deal, a report showed China had offered a path to eliminate its trade imbalance with the U.S. by ramping up purchases of goods made in America. Treasury yields on 10-year notes pushed higher and the dollar rose.

Oil remained above $53 a barrel and commodities extended their recent advance on Friday.

Source: Bloomberg

RESEARCH REPORT

First REIT – A cautionary tale

Ceasing coverage

– FY18 Revenue and NPI were in line with our forecast. DPU outperformed our
estimates by c.5% due to a S$15mn income tax benefit arising from a write-back of
provision for deferred tax on fair value loss on investment properties, as a result of a
reduced tax rate.

– 4.7% and 4.5% YoY boost in FY18 Gross Revenue and NPI, respectively, driven by two
acquisitions made in 4Q17.

– Cost of debt relatively stable at c.3.84% despite rising interest rates.

– Receivables continue to mount, against backdrop of uncertainty over upcoming lease
expires, though some S$8mn of rental payments has since been received on Jan 15,
2019.

– Ceasing coverage due to reallocation of internal resources.


BREAKING NEWS

The CEO of the Manager of Frasers Centrepoint Trust, Dr. Chew Tuan Chiong will step down by year-end. His successor “will be announced in due course”.

Boustead Projects Limited has secured a contract worth over S$200 million to build an integrated advanced development and global headquarters for Surbana Jurong Private Limited and its group of companies to be located at the 600-hectare Innovation District in Singapore.

SK Jewellery Group Limited has entered into a memorandum of understanding with Bizkey Network Pte. Ltd., a blockchain-based Point-of-Sale (“POS”) systems provider, in relation to the acceptance of cryptocurrency as an alternative form of payment at its jewellery outlets.

Dasin Retail Trust has extended its S$106.6 million and US$52.4 million offshore facilities at a lower interest rate margin, and lengthened the weighted average term-to-maturity to 1.6 years.

Hyflux investors were told at the second town hall meeting that in a liquidation scenario, only note holders would get paid (recovery rate for 3.8% to 8.7%); perpetual and preference shareholders would get nothing.

Source: SGX Masnet, The Business Times

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

Important Information

Disclaimer
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 “as 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.