Daily Morning Note – 01 June 2018

WEEKLY MARKET OUTLOOK WEBINAR

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RESEARCH REPORT

Aoxin Q&M Dental Group – Witnessing greatness in the making
Recommendation: Not Rated, Last Close Price: S$0.22
Analyst: Soh Lin Sin
– We attended the official opening of Aoxin’s new dental hospital in Liaoning
Province, Northern China on Sunday 20th May-18, as well as its other dental
centres in Liaoning Province.
– The Group is embarking on an intensive expansion plan within an untapped
dental market in Liaoning Province.
– On our back-of-the-envelope calculation, we derived a valuation of S$0.29,
based on estimated 0.82 SCents FY19 EPS and 35x forward PER.

Old Chang Kee Ltd. – A strong finish, marking the inflection point
Recommendation: Buy (Maintained)), Last Close Price: S$0.76
Target Price: S$0.98, Analyst: Soh Lin Sin
– FY18 Revenue grew 9.1% YoY, driven by product innovations and in line with
our expectation
– FY18 Earnings beat our FY18e estimate by 13% on higher operating leverage
and lower than expected start-up costs from its UK JV
– Growth momentum to extend into FY19e, while gains from the expanded
factory capacity and new factory equipment should start to roll in more
significantly
– Final dividend of 1.50 cents, unchanged from last year
– Maintained BUY with unchanged DCF-derived TP of S$0.98

TECHNICAL PULSE

China Sunsine Ltd – Daily timeframe – Bullish
– The bullish follow through on 31/05/18 have also closed price back above the
20 day moving average with increasing volume signals the resumption of the
uptrend next.
– Expect price to head higher next to test the 1.63 resistance area followed by
1.70.

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

BREAKING NEWS

Major U.S. trading partners struck back against a White House move to slap steel and aluminum tariffs on Canada, Mexico and the European Union. Mexico, the third-largest U.S. trade partner, said it would penalize U.S. imports including pork bellies, apples, grapes, cheeses and flat steel.

Sears Holdings will be shuttering 72 more stores in 2018 and has identified 100 unprofitable locations in total that it plans to close over time. This is in addition to the 64 Kmart stores and 39 Sears stores that have already shut down this year.

Changes in the MSCI will take effect today, following mid-year reviews of its equity indexes. Five SGX-listed stocks will be impacted by revisions to the MSCI. Those added to various MSCI indices include Venture Corp, Dairy Farm, Top Glove, Guocoland, SIA Engineering, Wheelock. Hutchison Port Holdings Trust and StarHub will be removed from the MSCI Singapore Index and included in the MSCI Singapore Small Cap Index.

OUE Hospitality Reit CEO Chong Kee Hiong will be stepping down as CEO and executive director with effect from July 15 to pursue other professional interests. Deputy CEO Isaac Chen Yi-Chung will be appointed acting CEO.

Keppel Infrastructure Trust chief executive officer Khor Un Hun will step down from his position on June 30 to pursue other interests. Succeeding Mr Khor is Matthew Pollard, who will be CEO from July 1.

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

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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