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CGS CIMB |
UOB KAYHIAN |
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ST Engineering Growing smart city presence in Middle East
■ STE clinched a S$60m smart city contract in Qatar. While the contract size is small, we are positive on future potential wins in the Middle East region. ■ For its business update on 18 Nov 2024, we preview 3Q24F revenue to come in at S$2.75-2.79bn (+13-15% yoy), largely in line with consensus figures. ■ Reiterate Add. Our TP is unchanged at S$5.30, based on 20x CY25F P/E.
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Frencken Group (FRKN SP) Expect Gradual Recovery Across Most Segments
Frencken expects to see a gradual recovery in its major segments, including the semiconductor and life science segments. However, its automobile segment could see a slower ramp-up as major customers have yet to make their final decisions on whether to select new energy or traditional vehicles. On the other hand, Frencken’s industrial automation segment should see a stable performance from a low base, while its medical segment should remain stable as well. Maintain BUY and target price of S$1.74
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MAYBANK KIM ENG |
MAYBANK KIM ENG |
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Frencken Group Ltd (FRKN SP) Ramp up likely from 2-3Q25 onwards
Positive 2H24 outlook – maintain BUY We are still not seeing any big ramp up in orders through our channel checks in the semi-con sector and now believe that the much anticipated acceleration in orders will likely occur from 2-3Q25 onwards. We still expect profitability to be stronger in 2H24 vs 1H24 but earnings likely won’t be as strong as anticipated due to slower-than expected growth in the life science sector. Hence, we cut our FY24/25E PATMI by 15%/18% respectively, and lower our TP to SGD1.54, pegged to an unchanged 15.5x FY24E P/E. Frencken remains our Top Pick in the Singapore tech sector.
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Dyna-Mac (DMHL SP) Accept the offer
Offer raised to SGD0.67/share – final offer As we have expected, Hanwha group has raised its offer and announced a final offer of SGD0.67/sh for Dyna-Mac, above our TP of SGD0.64. The offer is final and there will not be any further raises. As the offer price is higher than our TP, we think that the offer is fair and shareholders should accept the offer even though we are currently in an FSPO upcycle. We believe that this represents a fair exit price for shareholders to realise their investment and reinvest into other under-valued counters.
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| CGS CIMB | MAYBANK KIM ENG |
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Tencent Game revenue growth likely accelerated in 3Q24F
■ Due to its newly launched DnF game, we believe Tencent’s game revenue growth accelerated to 13% yoy in 3Q24F, from 9% yoy in 2Q24. ■ We also believe its advertising revenue growth remained solid in 3Q24F, at 16.0% yoy, slightly slower than 19.5% yoy in 2Q24. ■ As weak consumption impacted its online payment business, we forecast flat fintech and business services revenue yoy for 3Q24F. ■ Overall, we expect yoy growth of 7.6% in revenue and 14.9% in non-GAAP net profit for 3Q24F. ■ Reiterate Add with an unchanged DCF-based TP of HK$524.
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CIMB Group Holdings (CIMB MK) Decent contributions from Singapore
CIMBS to contribute 10-12% of group earnings That CIMB Singapore (CIMBS) contributes to over 10% of CIMB Group’s earnings is impressive, especially since this has been achieved with just one branch. It is envisaged that the bank will contribute to a stable 10- 12% of group earnings over the long term. We maintain a BUY on CIMB with an unchanged earnings forecast and our TP of MYR9.20 is maintained (CY25E PBV of 1.3x; ROE: 11.2%).
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