SGX
Top stocks by Flow in Week of 23 Oct
Top 5 Institutional Net Buy Stock Top 5 Stocks with Biggest Increase In Daily Volume*Stock nameNet Buy (S$M) Stock nameVolume Variance (%)DBS36.5 IFAST CORP199%YANGZIJIANG SHIPBUILDING21.0 YANGZIJIANG FINANCIAL133%OCBC17.4 KEPPEL DC REIT115%SIA14.1 FIRST RESOURCES94%SINGTEL12.4 UOL GROUP85% Click here to view the full Fund Flow Tracker, including fund flows for the 100 most traded stocks. *Top 5 Stocks with Biggest Increase in Daily Volume table includes stocks that have a minimum 3-month Average Daily Value Traded of S$1 million. 'Vol Variance' is the % variance of last week’s average daily volume traded vs. 3-month average daily volume.
CapitaLand Investment buys back S$29M in shares, abrdn’s deemed AEM interest back above 9% Institutions were net sellers of Singapore stocks over the five trading sessions through to October 26, with S$109 million of net institutional outflow, as 19 primary-listed companies conducted buybacks with a total consideration of S$39.0 million. Click here to read more.
REIT Watch - Mapletree S-REITs’ scorecards reflect operational resilience despite global slowdown Check out the performances of S-REITs in the Mapletree family for the second quarter of FY23/24 ending September 2023. Click here to read more.
IPO: Sheffield Green - Human Resource Provider in the Renewable Energy Industry - Lists on SGX Sheffield Green, a human resource service provider in the renewable energy industry made its debut on Catalist on 30 Oct 2023. It sees industry growth through the continued acceleration of decarbonisation and transition to renewable energy. For 9MFY23 ended 31st March, Sheffield Green’s revenue grew 4x YoY to US$19 million. This was attributed to an increase in projects secured as well as the number of personnel provided for existing projects primarily in Taiwan and France. Click here to read more.
IPO: Niks Professional - Advancing Skincare with Integrated Medical Solutions - Lists on SGX Catalist Niks Professional, a family practice dermatology and aesthetic medical services provider with 25 years of experience, made its Catalist debut on 27th Oct 2023. The Group has businesses across Singapore and China. It anticipates Singapore's private dermatology and aesthetic medicine industry to reach S$756m by 2025, driven by a high rate of skin conditions and a growing interest in skincare. Click here to read more.
5 in 5 with Audience Analytics - Optimising Businesses Through Digitalisation Audience Analytics is an enabler and growth partner to businesses in various sectors. In order to reduce environmental impact, the Group has been actively reducing the usage of printed materials. In FY22, it reduced 1.5 million sheets of paper by replacing printed publications with digital profiles. Click here to read more.
kopi-C with Nera Telecommunications' CEO: "Work hard, stick to your goals and keep going" This week, we spoke with Mr Chong Hoi Ming, the CEO of Nera Telecommunications (NeraTel), a communications and network solutions provider. Read on to find how the firm's long history and ability to inspire loyalty in customers intrigued him. Click here to read more.
Phillip Capital Market Reports:
Phillip Daily Morning Note :
US Market (By Phillip Global Markets Night Desk)
31 October 2023
China: A Growth Opportunity and a Risk
Economic trends in China bear watching. China is now an $18 trillion economy and represents about 18% of the global economy. Thus, China is a critical contributor to overall global economic growth, even if it "only" grows 3%-5%. In fact, 4% growth in the Chinese economy today adds more to global output than the 10% growth achieved 10 years ago, when China was growing faster but was smaller. China also poses risks to the global economy, particularly through its relationship to Taiwan. We see a low likelihood of a Chinese invasion of Taiwan. First of all, the Russian invasion of Ukraine has hammered home the challenges of invading a sovereign land in the age of modern weapons, which mitigate soldier-number advantages. Second, Taiwan, unlike Ukraine, is not land-adjacent, but across a vast body of water -- further lessening the chances of success. Third, Ukraine is not a NATO member and the U.S. does not have defense treaties with Ukraine. The U.S. does have a defense treaty with Taiwan, which China will not take lightly. Fourth, if China invades Taiwan, it risks becoming a pariah nation -- and China is an export economy, so any invasion would facture its relationships in key markets. Eager nations like Vietnam, Malaysia, Philippines and Indonesia would be happy to pick up the slack in global trade, and China knows this. Finally, China has not bounced back from COVID lockdowns. Given deep pressures in the real estate and banking sector, heightened global competition from the nations mentioned above, the rise of India, a demographic crisis (not enough young people), and other factors, China could slip to slow growth or possibly recession in coming years. Adding the strain of a major war that might prove unwinnable adds to those risks.
Market Wrap
Stocks rose, with the S&P 500 set to extend its rally for a second day, as companies including Jeep maker Stellantis NV and social media company Pinterest Inc. reported better-than-exected earnings.
S&P 500 futures added 0.2% and Europe’s Stoxx 600 climbed 0.6%. Bonds climbed, with the yield on the 10-year note falling 8 basis points, after the US Treasury reduced its estimate for federal borrowing for the current quarter, citing stronger-than-expected revenue.
Today's Big News
Israel Latest: Iran Says Need to Use ‘Last’ Chance to Halt War
Euro-Zone Inflation Sinks to 2-Year Low as Economy Contracts (2)
BOJ Is Handing Back the Japanese Bond Market to Investors (1)
Apple’s App Charges Violate EU Antitrust Law, Dutch Agency Says
Caterpillar Falls as Shrinking Backlog Signals Demand Worries
Banker Bonuses for ECM Shops Looking Abysmal With Light Issuance
OCBC
DBS
Market News
MAS expects Singapore GDP growth to pick up pace in 2024, on recovery of manufacturing and financial sectors
Samsung 3Q profits came in above estimates at 5.5trn won, hinting a sign of chip recovery
Apple unveiled updated iMac, MacBook Pros and M3 chip line, in bid to capitalize on an improving computer market
Singapore Stocks
Stocks to watch as China ramps up flights
Expect a boost for overall mobility within China with domestic flights set to increase to 96.7k/week (34% above pre-Covid levels)
China’s aviation regulator says that the growth in domestic flights focuses on higher connectivity between regional and hub airports the likes of Shanghai, Beijing, and Guangzhou
Momentum is also building for international flights, which is forecast to hit 71% of pre-pandemic levels in the next few months
What are the stocks to watch?
Click here to read our views
China/Hong Kong: Monthly Market Pulse
What are the missing pieces?
Our analysis based on past market turnarounds indicate foreign fund flows, elevated US rates and policy support are hurdles for a potential rebound
Investors don't need to be too bearish as increasing US-China communications and stronger fiscal stimulus among positive signs to bridge the confidence gap
National Financial Work Conference, APAC Summit among potential market catalysts
Which sectors do we prefer?
Click here to read our views
China Sportswear Sector
Winners in a new context
Latest double-11 pre-sales signal accelerated destocking, positively expediting 4Q23 sales recovery at strong double-digit rates
Newer market trends include widening price range, more flagship stores with value-added services, and expanding footwear category that companies like Nike and Anta have the upper hand
Which counter is our top pick?
Click here to read our views
OUE Commercial REIT (OUECT SP)
Recovery ahead of expectations
3Q23 revenue and net property income (NPI) +8% q-o-q and +7% q-o-q, respectively (in line), led by hospitality (NPI +20% q-o-q)
Key positives: i) Record-high RevPAR, ii) strong positive reversions from Singapore commercial, iii) achieved investment grade rating and lower interest costs
Data to watch: i) interest costs hereon, ii) likely retention of capital distribution for future
Is the counter well-positioned in a turn in the interest rate cycle?
Click here to read our views
Wilmar International Ltd (WIL SP)
Banking on food product recovery trend
Wilmar is trading below its five-year average PE multiple of FY24F 9.1x, close to palm oil stock territory
Profitability improvement in 3Q23 could signal we are pass inflexion point for better earnings outlook ahead
Lowered FY23F/FY24F earnings forecast, but projections still offers 19% CAGR FY23F-25F
What are the potential re-rating catalysts?
Click here to read our views
DBS Group Research | Equity Picks
Singapore Equity Picks: Read more
Hong Kong Equity Picks: Read more
UOB
UOBKH: Regional Morning Meeting Notes: Tuesday, October 31, 2023 (PM EDITION) - Additional: AALI IJ [GC Strategy, 1211 HK, 939 HK, 3968 HK, 000333 CH, 1099 HK, 002472 CH, 2899 HK, AALI IJ, BUKA IJ, CMRY IJ, ROTH MK, TDC MK, CDREIT SP, CLAS SP, DELT...
Click on the link for details.
UOBKH: Country Dailies: Tuesday, October 31, 2023
Click on the link for Greater China Daily.
Click on the link for Indonesia Daily.
Click on the link for Malaysia Daily.
Click on the link for Singapore Daily.
Click on the link for Thailand Daily.
UOBKH: Retail Market Monitor: Tuesday, October 31, 2023
Click on the link for details.
UOBKH: Regional Morning Meeting Notes: Tuesday, October 31, 2023 [GC Strategy, 1211 HK, 939 HK, 3968 HK, 000333 CH, 1099 HK, 002472 CH, 2899 HK, BUKA IJ, CMRY IJ, ROTH MK, TDC MK, CDREIT SP, CLAS SP, DELTA TB]
Click on the link for details.
KGI
Technical Analysis: 31 October 2023
🇸🇬 SG
China Aviation Oil (CAO SP)
First Resources Ltd. (FR SP)
🇭🇰 HK
Wuxi Biologics Cayman Inc (2269 HK)
Genscript Biotech Corp (1548 HK)
Read More: https://www.kgieworld.sg/research/oct31ta23
Top Stories, 31 Oct 2023
1. Asia markets mixed ahead of Bank of Japan decision, China PMI
2. CME Group's E-mini S&P 500 Futures provide one of the most efficient, liquid and cost-effective ways to gain market exposure to the S&P 500 Index.
Find out more: http://bit.ly/KGI_CMEemini
3. US House Republicans unveil bill to fund Israel by cutting IRS budget
4. Oil slumps on easing fears of Mideast regional war
5. China EV maker BYD reports record quarterly profit of 10.41 billion yuan in Q3
6. US Dollar traded soft while investors await Fed decision
CIMB
SIN: CapitaLand Ascott Trust - Sequential recovery in progress (ADD - Maintained)
SIN: Wilmar International - Slow recovery in profits, but worst is over (ADD - Maintained)
APAC: ASIA Pacific Daily - 31 October 2023
Equity Research Reports....
▌ RECOMMENDATION CHANGES & INITIATIONS...
IND: Bank Jago (HOLD▼, tp:IDR1,650.00▼) (ESG) - Toning down expectations (30/10)
▌ TARGET PRICE CHANGES...
CHN: Wuliangye Yibin (ADD, tp:CNY214.00▲) - Strong 3Q23 sales growth (30/10)
HKG: China Life Insurance (ADD, tp:HKD15.60▼) - A better 1Q24F NBV growth outlook (30/10)
HKG: Techtronic Industries Co (ADD, tp:HKD83.60▼) - Improving sales and balance sheet outlook (30/10)
HKG: Tsingtao Brewery (ADD, tp:HKD113.10▼) - Slightly weak topline in 3Q23 (30/10)
IND: Bank Mandiri (ADD, tp:IDR6,850.00▲) (HC)(ESG) - Higher profitability across earnings drivers (31/10)
IND: Perusahaan Gas Negara (ADD, tp:IDR1,425.00▼) - Lower gas distribution spread hit 3Q23 profit (30/10)
SIN: CDL Hospitality Trust (ADD, tp:SGD1.43▼) - More even, broad-based recovery (30/10)
THB: Central Retail Corporation (ADD, tp:THB46.25▼) (ESG) - 3Q23F core net profit likely weak (30/10)
▌ SECTOR & COMPANY NOTES...
CHN: Bank of China-A (HOLD, tp:CNY3.70) - Still maintaining stability of earnings (30/10)
CHN: China CITIC Bank-A (ADD, tp:CNY6.00) - On track for rising ROE in FY23F (30/10)
CHN: China Merchants Bank-A (ADD, tp:CNY53.60) - FY23F to be another year of falling ROE (30/10)
HKG: Bank of China (ADD, tp:HKD3.60) - Still maintaining stability of earnings (30/10)
HKG: China CITIC Bank (ADD, tp:HKD5.30) - On track for rising ROE in FY23F (30/10)
HKG: China Merchants Bank (ADD, tp:HKD57.30) (HC) - FY23F to be another year of falling ROE (30/10)
HKG: Ping An Insurance (ADD, tp:HKD80.00) - Important metrics are diverging (30/10)
IND: Indosat (HOLD, tp:IDR10,500.00) - Solid 3Q23 on ongoing margin expansion (30/10)
KR: Tokai Carbon Korea (ADD, tp:KRW110,000.00) - Quarterly sales grew sequentially (30/10)
MAL: Axis REIT (ADD, tp:MYR2.01) - Earnings growth driven by acquisitions (30/10)
MAL: Gamuda (ADD, tp:MYR5.65) - Building a recurring income base with hydro (30/10)
MAL: Malakoff Corporation (ADD, tp:MYR0.80) - Expanding waste management services (30/10)
SIN: CapitaLand Ascendas REIT (ADD, tp:SGD3.06) (HC) - Resilient operations (30/10)
SIN: Starhill Global REIT (ADD, tp:SGD0.62) - Another quarter of occupancy growth (30/10)
SIN: Wilmar International (ADD, tp:SGD4.05) - Slow recovery in profits, but worst is over (30/10)
THB: Ngern Tid Lor (ADD, tp:THB34.25) - NPLs likely peaked in 3Q23F (30/10)
▌ RECENT 'IDEAs OF THE DAY'...
MAL: Strategy Note - Budget 2024: policy continuity (14/10)
MAL: Economic Focus - Budget 2024: Raise revenue, cut spending (14/10)
THB: Hana Microelectronics (ADD▲, tp:THB80.00▲) (ESG) - Multiple tailwinds to drive OP growth (10/10)
MAL: Strategy Note - One step at a time (4/10)
MAL: Economic Focus - Budget 2024 Preview: Tightening purses (2/10)
SINGAPORE
DOW +511pts (+1.6%) NDQ +146pts (+1.2%) SPX +49pts (+1.2%) WTI (-3.8%) GOLD flat
US mkts finished deeply in the green across the board last night in a rebound after the S&P fell into correction territory last wk. The gains come after oil pxs fell on a slower than expected ground incursion into Gaza by the IDF, coupled with a general rebound after extreme negative sentiment. The treasury released their funding needs for the last Q at 776b, below the estimated 800b. BOJ is rumoured to loosen their YCC. HK reports 3Q GDP today. Brent trades at the mid $87/bbl lvl. SG 10y trades at 3.39/3.34%.
CGS-CIMB Highlights
* Wilmar Intl (WIL SP) At an analyst briefing on 30 Oct 23, Wilmar (WIL) guided for a gradual improvement in profitability given the slow recovery in consumption. Nevertheless, sales volume growth of its food products segment in 3Q23 suggests WIL continues to gain market share in China, management said. Maintain Add with unchanged SOP TP of S$4.05 as underlying assumptions of a gradual recovery in profitability remains intact post analyst briefing.
* Capland Ascendas REIT (CLAR SP) CLAR enjoyed high portfolio occupancy of 94.5% and healthy rental reversion of 10.2% in 3Q23. Acquisition of the data centre in the UK and completion of its development property in Australia in Oct 23 should bolster CLAR’s earnings going forward. Reiterate Add with an unchanged TP of S$3.06.
* CityDev (CIT SP) 9M23 NPI of S$101.8m (+23% yoy) missed expectations at 65% of our FY23F, mainly due to lower-than-forecast Singapore non-room revenue. Six out of its eight markets posted higher yoy 3Q revenue per available room. Reiterate Add on CDREIT as a hospitality recovery play.
* Starhill Global REIT (SGREIT SP) 1QFY6/24 NPI rose 0.4% yoy to S$37.4m, in line at 25% of our FY24F. 1Q NPI growth was driven by positive reversions in Singapore and higher occupancy in the Australian portfolio, partially offset by forex movements. Reiterate Add. SGREIT is on track to deliver FY24F DPU growth of c.3.7%, translating to FY24F DPU yield of 8.8%.
OTHER NEWS
* Tianjin Pharma (TIAN SP) 3QFY23 results, rev -5% yoy, EBIT -6% yoy, net profit -52% yoy. Large decline in results were largely led by a -92% yoy decline in 'Other Gains' and -48% yoy decline in 'Share of profit of associates'.
* OUE Comm REIT (OUECT SP) and all their existing notes was assigned a BBB- credit rating with a stable outlook at S&P. The company released 3QFY23 results, +29.8% NPI yoy helped by exposure to the hospitality sector on a recovery in tourism. SG office portfolio occupancy stands at 95.7% with positive rental revisions of +18.4%.
* GHY Culture & Media (GHY SP) subsidiary entered into a cooperation agreement with Shanghai Xixin Culture & Broadcast to be named co-organiser of a series of Jay Chou's Carnival World Tour concerts held in Shanghai from 12 Oct to 15 Oct 2023.
* CIVMEC (CVL SP) 1QFY24 results, rev +7.3%, EBITDA +9.1%, order book AUD1.102b (+17.9%)
* Samudera Shipping (SAMU SP) released poor profit guidance for 9MFY23 revenue and earnings compared to the previous yr due to a decline in the general market demand which resulted in lower container volume and freight rates yoy.
MALAYSIA
Asian stock markets had a mixed day, with the Malaysian index, KLCI, dropping 0.19% to 1,439.20 points. Plantation stocks went up, while telecommunications, energy, and technology stocks suffered losses. The market is waiting for interest rate decisions this week. Staying above 1,430 gives buyers an edge, and a strong breakout could push it to 1,460-1,465, while dropping below 1,430 means consolidation with support at 1,412-1,416. 🔴CGS-CIMB Highlights *Axis REIT (AXRB MK)- Earnings growth driven by acquisitions (Maintain Add with a TP of RM2.01) https://bit.ly/3QCX5Ol *Gamuda (GAM MK) - Building a recurring income base with hydro (Maintain Add with a TP of RM5.65) https://bit.ly/47eLg6f *Malakoff Corporation (MLK MK) - Expanding waste management services (Maintain Add with a TP of RM0.80) https://bit.ly/46RGcFk 📰💼COMPANY NEWS💼📰 *MyEG Services Bhd (MYEG MK) has received a three-year contract extension from the Road Transport Department (JPJ) of its appointment as a collecting agent for the provision of vehicle registration services, driver and vehicle licensing, and electronic payment of summons services. *British American Tobacco (Malaysia) Bhd’s (BAT MK) net profit declined 20.89% to RM59.54 million or 20.9 sen per share for the third quarter ended Sept 30, 2023 (3QFY2023) compared with RM75.25 million or 26.4 sen per share in the previous year’s corresponding quarter as investment in tobacco heating and vapour products more than offset price adjustments — its first since 2018. *Berjaya Corp Bhd (BCORP MK) has raised its stake in Berjaya Food Bhd (BFood), whose share price has fallen by a third year to date, to 57.43% from 55.31% after buying 37.25 million shares. *Dagang NeXchange Bhd’s (DNEX MK) 90%-owned subsidiary Ping Petroleum Sdn Bhd has secured a contract from Petroliam Nasional Bhd (Petronas) in relation to the production of petroleum and abandonment of petroleum facilities.
Lim&Tan
MayBank
HK: DIM SUM DAILY
CapitaLand Ascendas REIT | Safe harbour; U/G to BUY Krishna Guha
CapitaLand Ascott Trust | Striving for stability Krishna Guha
ESR-LOGOS REIT | Moderating momentum Li Jialin
SG Daily Newsletter | Tuesday: Market Shaping News Singapore Research Team
FEATURED CALLS
Philippines | Robinsons Retail Holdings 3Q/9M23 dragged by GoTyme losses and interest expense Daphne Sze
Thailand Power Sector | Expecting healthy 3Q23 earnings jump | NEUTRAL Natchaphon Rodjanarowan
Malaysia | Technical Trading Ideas: Blue chips outperform both mid & small caps Nik Ihsan Raja Abdullah
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