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UOB KAYHIAN |
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Hyphens Pharma International Ltd More visible growth drivers
2023 results beat expectations. Both revenue and PATMI were 106% of our forecast. Other markets, such as Indonesia and the Philippines, grew faster than expected due to the maiden contribution from Laboratoires Gilbert S.A.S exports.
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Singapore Telecommunications (ST SP) Illuminating Value In Optus
Responding to The Australian Financial Review article on the potential sale of Optus for A$16b, Singtel stated that there is no impending deal at this juncture. That said, management is regularly reviewing its underlying assets. We believe this news helped illuminate value of its underlying asset as Singtel’s current market capitalisation reflects little value of its Singapore consumer business and Optus asset. Operationally, Optus’ operating trend is on an uptrend. Maintain BUY. Target price: S$2.99.
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LIM & TAN |
CGS CIMB |
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Singtel ($2.48, halted) surged 9 cents to $2.48 before a trading halt was instituted as news leaked that the company is in advanced discussions to sell Optus, Australia’s second-largest telecommunications group, to Toronto-headquartered private equity giant Brookfield in what would be a blockbuster deal worth some $16 billion, the Australia newpaper Australian Financial Review (AFR) reported. In response to the article published in AFR “Singtel in advanced talks to offload Optus to Brookfield for $16b”, Singtel seeks to clarify that there is no impending deal to offload Optus for the said sum, as reported. Optus remains an integral and strategic part of the Singtel Group and we are committed to Australia for the long term. Our current focus has been on improving network resilience and conducting a CEO search. That said, we regularly conduct strategic reviews of our portfolio to optimise the value of our assets and businesses and will explore all options to maximise shareholder value. Shareholders of Singtel and potential investors are advised to exercise caution in their review of any media reports relating to Optus ahead of any definitive announcements when dealing with the shares of the company. As a result of the above refutations of the possible sale of their Optus stake to Brookfield and considering the heightened hectic speculative trading interests in Singtel just before the trading halt and refutation announcement, it would be not a surprise to see a sell-off in Singtel shares this morning as the trading is lifted. Notwithstanding the sell-off, we see opportunities to “Accumulate On Weakness” as we remain medium term constructive on SingTel. Reasons would be that they have recently sold off a stake in Airtel and made substantial gains which would allow them to pay normal and special dividends and Bloomberg consensus 1 year target price of $3.07, implies a potential upside of 25%.
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Carlsberg Brewery (M) Changing trends but valuations support
■ We reiterate our Add call on Carlsberg albeit with a reduced GGM-derived price target of RM22.70 (prev. RM26.80) post 4Q23 results. ■ Demand trends normalising post super-normal 2022, industry evolving to meet demand of younger adults, with tourist inflow providing a boost. ■ Valuations at CY25F P/E of 15.9x, ~0.5x normalised post-2010 mean. >5% FY24-26F dividend yield provides support to its share price from downside.
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| CGS CIMB | UOB KAYHIAN |
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Hyphens Pharma International Positive on expanding portfolio
■ HYP posted net profit of S$8.6m for FY23, slightly above expectations at 107.3% of our FY23F estimate, as sales hit a record-high in 4Q23. ■ HYP said it is looking to mend its GP margin of 35.3% in 2H23 (-3.5% pts yoy/-2.2% pts hoh) by improving its sales mix. ■ Reiterate Add with a higher DCF-based TP of S$0.35 as we see earnings growth supported by contribution from new products added to its portfolio.
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Malaysia Airports Holdings (MAHB MK) PSC Revision Materialises But Marginal Earnings Accretion To MAHB
We are positive on the new set of PSCs and landing and parking charges despite the marginal earnings impact, as it sets the path for the implementation of a cost-based framework in setting airport charges. We believe the market will turn its attention to the new OA which may shed more light on MAHB’s upcoming expansion projects and the pertinent funding mechanism. We arrive at a higher target price of RM9.86 after incorporating the latest PSC revisions. Maintain BUY.
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