Daily Morning Note – 3 December 2020

PHILLIP SUMMARY

Asian stocks looked set for a cautious start Thursday after U.S. equities eked out another record high amid renewed optimism over U.S. stimulus talks and vaccine approval. Treasury yields ticked higher and the dollar touched a more than two-year low. Futures were little changed in Japan and slightly higher in Hong Kong and Australia. The S&P 500 closed at another all-time high, led by gains in energy stocks.

BREAKING NEWS

Japanese-managed precision-components maker CDW Holding , made a US$46,000 net profit for the nine months ended September, reversing the US$1.94 million loss from a year ago. Its revenue for the period rose 7.9 per cent year on year to US$76.18 million, the mainboard-listed firm disclosed in a Wednesday business update filed with the bourse.

Geo Energy Resources , has hit the minimum threshold for its coal reserves, such that the mainboard-listed firm will not have to make a mandatory offer to purchase the 8 per cent senior notes issued by its wholly-owned unit, Geo Coal International. In a bourse filing on Wednesday evening, Geo Energy said that it had 87.5 million tonnes of coal reserves in its two Indonesian mining concessions, Sungai Danau Jaya (SDJ) and Tanah Bumbu Resources (TBR), as of end-April. This exceeds the minimum requirement of 80 million tonnes of regulatory-compliant coal reserves that it had to meet.

Credit Bureau Asia (CBA)received applications from retail investors for 60.8 times the number of shares available in the public portion of its initial public offering (IPO), it announced on Wednesday. With 1.5 million shares available to the public for subscription, it received more than 4,000 valid applications for about 91.3 million shares, with application monies received amounting to S$84.9 million. Additionally, the credit- and risk-information solutions provider also attracted “strong interest” for its 28.5 million placement shares from institutional and other investors.

There is “nothing unusual or improper” about the voting procedures adopted for the proposed merger of Sabana Shari’ah Compliant Industrial Real Estate Investment Trust (Sabana Reit) and ESR-Reit Sabana Reit’s manager made that point in a bourse filing on Wednesday morning in response to concerns raised by the deal’s key opponents, adding that the procedures apply equally to all unitholders of the trust. The voting procedures are also the same as those adopted in all Reit mergers in Singapore to date, in that unitholders – including nominee companies and custodians – were only allowed to appoint one proxy, and unitholders could only vote their units in one direction.

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

TECHNICAL REPORTS

Oversea-Chinese Banking Corp Ltd

Analyst: Chua Wei Ren

Recommended Action: Technical BUY

OCBC Bank (SGX: O39) recovery has been slow and corrective in nature since the grand sell down during the March 2020 selling. However, based on the technical, we are seeing potential further upside

>> Read more Technical reports

RESEARCH REPORTS

Keppel Corporation – Strategic review of O&M unit and divestments to drive potential re-rating

Recommendation: BUY (Initiation), Last Done: S$5.17

Target price: S$6.12, Analyst: Terence Chua

– Reaffirmation of capital recycling to unlock S$17.5bn a re-rating catalyst.

– 100-day programme to provide greater clarity on Keppel O&M and remove key overhang.

– Longer-term ROE target of 15% intact

– Initiate with a BUY recommendation and a target price of $6.12 based on our sum-of-the-parts valuation with a 10% holding company discount. Our TP translates to about 1.0x FY21e book value, a slight discount to their 5-year average of 1.05x

>> Read more research reports

HK Reports – Read up on our Hong Kong reports here

RESEARCH VIDEOS

Webinar Of The Week

Market Outlook: SATS, StarHub, Civmec, Centurion, DBS, SREITs Monthly and SG Weekly

Date: 23 November 2020

For more on Market Outlook

Updates summarised in 3 minutes

Phillip Research in 3 minutes: #26 – iX Biopharma Ltd; 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





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 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.