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CGS CIMB |
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United Overseas Bank (UOB SP)
Downgrade to NEUTRAL from Buy with new SGD25.80 TP from SGD29.50, 2% upside, on 1.11x 2020F P/BV. Economic disruption from the coronavirus outbreak is expected to adversely impact Singapore banks’ operations not just in Greater China, but also Singapore – the tourism sector is one example. We downgrade our ROE expectation to 11.6% (from 12.7%). 2020F earnings are also cut by 3% as we assume slower loan expansion and higher provisions. Amongst banks under our coverage, UOB remains our preferred pick.
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CSE Global Bolstered backlog!
■ CSE today revealed that it achieved c.S$230m new orders in 4Q19, taking its FY19 win to S$580m (+50% yoy). ■ While within our expectations, we are still excited with this as we see it as confirmation its end-FY19 order book exceeded S$300m (2018: S$181m). ■ We expect CSE to report FY19F net profit of S$22.5m (+9% yoy). We keep our forecasts, call and TP. Reiterate CSE as our favourite small cap.
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| PHILLIP SECURITIES | CGS CIMB |
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Ascott Residence Trust Stability through asset recycling and redevelopments SINGAPORE | REAL ESTATE (HOSPITALITY) | RESULTS
4Q19/FY19 NPI and DPU in line with forecast. Diversified portfolio proving resilient, active portfolio reconstitution unlocked c.S$200mn of net gains. The longer average length of stays typical for serviced residence, driven by corporate clientele makes ART less affected by Coronovirus impact compared to leisure-driven hospitality REITs. Upgrade to BUY with a higher TP of $1.53 due to higher earnings/DPU forecast and factoring in recent divestments and the redevelopment of Somerset Liang Court.
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UMS Holdings Ltd Watch S$0.815 support level
■ Based on forecasts and data from SEMI, the semicon industry is set for a recovery in 2020, benefitting UMS. ■ Key risks are possible export restrictions and impact from a prolonged coronavirus situation. ■ We reiterate Hold with higher TP of S$0.96, which assumes the risks mentioned above do not derail the semicon recovery.
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