Daily Morning Note – 23 April 2018


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Singapore Exchange Limited – Thank you volatility
Recommendation: BUY (Maintained), Last close price: S$7.56
Target Price: S$9.20, Analyst: Phillip Research Team
– 3Q18 PATMI beat our estimates by 11%. Revenue of S$222mn is the highest since
listing. It was securities revenue that exceeded our expectations.
– Derivatives business drove revenue growth with volumes surging by 34% YoY. FX
derivatives enjoyed a stellar 89% spike in volumes.
– SGX will launch new Indian equity derivative products by June18, linked to a socalled
“publicly available reference price”.
– Maintain BUY. Our target price raised to S$9.20 (previously S$8.89), in-line with
the increase in our FY18e earnings by 4%.

CapitaLand Mall Trust Ltd – Sale of Sembawang Shopping Centre at 2x FY17 valuation
Recommendation: Neutral (Maintained), Last Close Price: S$2.10
Target Price: S$2.05, Analyst: Tan Dehong
– Higher occupancy and lower operating expenses propped up DPU amidst still
challenging operating environment in terms of tenant sales.
– Sale of SSC to Lian Beng at 1.97x FY17 valuation a positive surprise.
– No more debt expiries/refinancing risk in FY18.
– Overall tenant sales still sluggish, down 0.2% YoY.
– Maintain Neutral with increased TP of S$2.05 (from S$2.03) to factor in
divestment gains.


Sembcorp Ind Ltd – Weekly timeframe – Bullish
– The recent price action signals a possible move back into the uptrend again after
price broke and closed significantly above the 3.18 range high and 20, 60 day
moving average on the week ended 20/04/18.
– Expect price to head higher next to test the 3.38 resistance area followed by 3.60.

For more information and additional disclosures, refer to the link here.


United States Treasury Secretary Steven Mnuchin said he’s considering a trip to China. China’s Ministry of Commerce said it is aware that the U.S. is considering a visit to Beijing to negotiate economic and trade issues and welcomes such a move.

World Bank shareholders approved a “historic” increase in the bank’s lending capacity on Saturday (Apr 21) after the United States backed a reform package that curbs loans and charges more for higher income countries like China.

European Union and Mexico reached agreement on free trade deal. Under the updated terms of the 2000 deal, practically all bilateral trade in goods will now be duty-free, including in the agricultural sector.

Termination of Joint Venture between JEP China Holdings Pte Ltd and Kun Shan Fu Investment Co Ltd.

Property Developer SLP Development Ltd commenced trading on the Catalist board of SGX on Friday. Shares closed at S$0.25 per share 8.7% higher than issue price of S$0.23.

AusGroup Limited announced that subsidiary AGC industries Pty Ltd has been awarded the structural, mechanical and piping installation package by MSP Engineering Pty Ltd for the Talison Lithium Chemical Grade Plant 2 expansion at Greenbushes in Western Australia.

Source: SGX Masnet, Bloomberg, ChannelNewsAsia, Reuters, The Business Times, 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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