Daily Morning Note – 26 February 2018


Please be informed that the Webinar today will be postponed to 2.00PM (SG Time).
In today’swebinar, we provide results updates on UOB, OCBC, Thai Beverage, Sheng
Siong, Singapore O&G, Sembcorp Industries, and Sembcorp Marine.


Sheng Siong Group – The worst is over
Recommendation: BUY(Maintained), Last Close Price: S$0.93
Target Price: S$1.13 (Maintained), Analyst: Soh Lin Sin
– FY17 Revenue/PATMI were in line with our full year estimations
– 11 new stores growth and improving macro backdrop to mitigate absence of contribution from the Verge and Woodlands Blk 6A
– Declared final dividend of 1.75 cents per share (Full year dividend of 3.30
cents, or 71.1% payout ratio in FY17)
– Maintain BUY and TP at S$1.13

Sembcorp Industries Ltd – A new but same strategy unfolded
Recommendation: ACCUMULATE(Maintained), Last Done Price: S$3.86
Target Price: S$3.24, Analyst: Chen Guangzhi
– Utilities’ Singapore generated moderate growth but the group’s performance was dragged by weak India and marine operations- NII increased 15% YoY on the back of robust loans growth and higher NIM.
– A new strategy for the group: reposition utilities, support marine segment and move up value chain of urban development segment
– Plan to monetise some assets to enhance cash position
– Target to gain back double-digit ROE

Sembcorp Marine Ltd – A disappointing year for the group
Recommendation: REDUCE(Downgraded), Last Done Price: S$2.23
Target Price: S$1.91, Analyst: Chen Guangzhi
– Market condition started to improve, but SMM’s profitability remained weak
– Order flows started to pick up in 4Q17
– Net order book continued to decline
– Remain upbeat on the non-drilling solutions segment but longer time for drilling segment to recover


New Silkroutes Group Limited has entered into a MOU with Haitong International
Securities Group (Singapore) Pte. Ltd., where the latter will subscribe for S$5 million
worth of convertible bonds.

Noble Group Limited through its wholly-owned subsidiary, has entered into an asset
purchase agreement with Tricon Dry Chemicals LLC and Tricon International Ltd.(doing business as Tricon Energy).

Cordlife Group Limited has entered into a partnership with US-based PlumCare LLC
to offer a genetic testing service to help families in Asia identify gene variants associated
with increased risk of developing inherited conditions such as breast and ovarian cancer.

MindChamps Preschool Limited has acquired MindChamps Preschool @ Woodlands Pte. Ltd. at a consideration of S$1.3m.

SBS Transit has won the tender to operate the Bukit Merah Bus Package
, which includes two cross-border services to Johor Bahru. The five-year contract, which can be
extended by another two years, will start from the fourth quarter of 2018.

United Engineers announced that the resolution for the proposed interested person transaction-arising from its subsidiary, UE Centennial Venture Pte. Ltd.’s preconditional voluntary cash offer for WBL Corporation Limited -was not approved at its EGM on Friday.

Rowsley Ltd has received in-principle approval for its proposed acquisition of Sasteria Pte. Ltd., the owner of Thomson Medical and TMC Life.

Source: SGX Masnet, 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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