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PHILLIP SECURITIES |
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China Sunsine Chemical Holdings Spreads holding up well for now
■ 2H23 net profit (-17% yoy) was a beat, as GPM (-4.1% pts yoy) held up better than we expected. 1.0 Sct special DPS proposed, FY23 DPS 2.5 Scts. ■ GPM should remain under pressure on intense domestic competition. We still expect FY24F to be underpinned by healthy sales volumes (+c.5% yoy). ■ Reiterate Add with an unchanged TP of S$0.47, still based on 0.6x CY24F P/BV (1 s.d. below 5-year historical mean).
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Yoma Strategic Holdings Ltd Capitalising on the new challenges
We visited Yoma’s impressive office campus at Pun Hlang Estate in Yangon, which housed major business units such as Yoma Land, Wave Money and Yoma Fleet. The malls we visited had the usual traffic jams in the city centre. We also saw new infrastructure underway that will improve connectivity to their flagship StarCity project.
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PHILLIP SECURITIES |
UOB KAYHIAN |
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Singapore Air Transport – Feb24 Industry-wide cost pressure
All three aviation-related counters fell after reporting lacklustre Dec quarter business updates. SIA’s operating profit fell 19.3% YoY; SATS’ EBIT margin of 8.8% was below the mid-teens level pre-pandemic; and SIA Engineering incurred a S$3.4mn operating loss.
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Keppel Pacific Oak US REIT (KORE SP) Navigating The Office Downturn Without Diluting Unitholders’ Interests
KORE has been unfairly penalised. By halting distribution in 2024 and 2025, KORE is able to fund its capex internally, while avoiding dilutive equity fund-raising and divesting its assets at depressed fire-sale prices. Assuming no further revaluation losses at end-24, KORE will provide an attractive distribution yield of 34.3% for 2026 when it resumes normal distribution. P/NAV is already at a distressed level of 0.18x although KORE has not breached any loan covenants. Maintain BUY. Target: US$0.35.
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| LIM & TAN | |
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Digital Core REIT ($0.61, up 1.5 cents) announced that it has entered into a reinstatement and first amendment to contribution and sale agreement and escrow instructions with Digital Realty Trust, L.P., the Manager and Digital CR US REIT, Inc. to acquire an interest in the property located at Wilhelm-Fay-Straße 15 and Wilhelm-Fay-Straße 24 in Frankfurt, Germany; Singapore Sub 5 will acquire an 24.9% interest in the Frankfurt Facility. Digital Core REIT’s market cap stands at US$801.4mln and currently trades at 0.88x PB, with a dividend yield of 5.7%. Consensus target price stands at US$0.76, representing 24.6% upside from current share price. We recommend an “Accumulate” rating on Digital Core REIT
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