ANALYSTS SAY: Buy, Sell, Hold (1 Dec)

UOB KAYHIAN

City Developments
Continued hotel recovery momentum

■ Slower residential sales in 3Q due to absence of new launches
■ Strong hotel performance in 3Q22, with an 88.9% rise in RevPAR
■ Reiterate Add with an unchanged TP of S$8.97

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Singapore Airlines (SIA SP)
Potential Merger Of Vistara Into Air India A Positive Development

We are positive towards SIA’s planned merger of Vistara into Air India, which will allow SIA to strengthen its presence in the fast-growing Indian market via its 25.1% strategic stake in a stronger Air India (the surviving entity). Once completed, the effective disposal gain of SIA’s stake in Vistara would allow SIA to book a one-time non-cash accounting gain of S$1.1b, lifting SIA’s FY24F book value per share by 8%. Maintain HOLD on SIA, with a slightly higher target price of S$5.35, based on 1.06x FY24F P/B.

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UOB KAYHIAN

REITs – Singapore
S-REITs Monthly Update (Nov 22)

Sentiment has improved with the favourable reading for US CPI in October suggesting that inflation has peaked. S-REITs are likely to have bottomed in late-October. Maintain OVERWEIGHT. Our bottom-up and diversified BUY picks for blue chips are CLAS (Target: S$1.27), FCT (Target: S$2.46), LREIT (Target: S$0.82), MINT (Target: S$3.12) and MLT (Target: S$1.87).

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AMMB Holdings (AMM MK)
2QFY23 results above expectations

Forecasts maintained
While 1HFY23 results were above expectations on low credit costs, management maintains its credit cost guidance, which would imply higher credit costs in 2HFY23. Our forecasts are maintained and we continue to maintain a BUY on the stock, with an unchanged TP of MYR4.95, based on a CY23E PBV of 0.8x (CY23E ROE: 8.7%). 

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7-Eleven Malaysia Holdings (SEM MK)
Briefing update

Maintain BUY with unchanged TP of MYR2.35
SEM’s outlook remains positive with continued recovery in its convenience store segment and stable pharmacy store performance. The group will focus on increasing operational margins by improving product mix (through 7-Café stores) while balancing continued constraints in recruiting labour for its new stores. Maintain BUY with an unchanged TP of MYR2.35 (28x
FY23E PER, about -0.5SD to mean).

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Public Bank Bhd
Riding on NIM expansion

■ PBB’s 9M22 net profit was in line with expectations, accounting for circa 75%
of our full-year forecast and Bloomberg consensus estimate.
■ We are projecting 3.1% growth in 4Q22F net profit, underpinned by higher net interest income from NIM expansion and healthy loan growth of 4-5%.
■ Reiterate Add on PBB, as we see the bank as the most defensive against the credit risks from various headwinds, given its best asset quality in the sector. 

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