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CGS CIMB |
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Singapore Airlines Taking action to stem the cash burn
■ Demand on SIA’s North Asia flights and some connecting flights has been hurt by the Covid-19 epidemic, especially for discretionary leisure travel. ■ SIA is focusing on cash preservation by reducing capacity in Feb and Mar (more to come for Apr-May) and cutting certain non-critical capex. ■ Maintain Hold with unchanged target price of S$8.46, still based on 0.86x CY20F P/BV (1 s.d. below mean since 2011).
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Sheng Siong Group Resilient amidst Covid-19
■ Supermarkets are likely to be the key beneficiaries of the “staying indoors” trend, in our view, as people shy away from public areas/restaurants. ■ Especially SSG, which has a higher proportion of HDB stores (vs. malls) and caters to the mass market; it stands to benefit from Budget 2020, in our view. ■ Reiterate Add with a higher TP of S$1.46, as we lift our target PER to 24x (c.+2 s.d. level, vs. 22.5x previously).
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| PHILLIP SECURITIES | UOB KAYHIAN |
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ComfortDelGro Corp Ltd Hurt by one-offs
SINGAPORE | TRANSPORT SERVICES | 4Q19 RESULTS Revenue and PATMI were within expectations, excluding S$27.3mn impairment on the taxi business. Excluding provisiions PATMI would have declined an estimated 5%. Public transport services was surprisingly the worst hit segment with 25% YoY drop in 4Q19 operating profit. We believe a lumpy license fee could have been the trigger. Headline results was weak due to provision in taxi business and likely license fee expenses. We maintain ACCUMULATE but with a lower target price of S$2.20 (prev: $2.56). Our PATMI for FY20e is lowered by 16% to account for weaker traffic, rental rebates and disruption in China operations.
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Bumitama Agri (BAL SP) 2019: Still Not Out of The Woods
BAL’s 2019 earnings were below expectation despite the strong earnings recovery in 4Q19. The variance came from lower-than-expected FFB production growth as the impact from the dry weather and haze was more severe than initially assessed. BAL is expected to deliver better earnings in 2020, on higher ASPs and positive FFB production growth. We have adjusted our earnings forecasts post production adjustments and higher cost. Maintain BUY with a lower target price of S$0.85.
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