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CGS INTERNATIONAL |
SAC CAPITAL |
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REIT A Fed pause scenario
■ Our house view assumes a Fed pause scenario, in contrast to the 1.4x rate hikes implied by swaps markets, according to Bloomberg. ■ We see stable short- and long-end of yield curves supporting S-REIT valuations, funding costs and yield spread appeal. ■ As at Mar 26, MINT, CLAR and CLAS had higher exposure to USDdenominated debt among the S-REITs under our coverage. ■ The industrial S-REITs segment had 65% foreign currency-denominated debt, higher than other segments on average.
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Getting Back On Track Sanli Environmental reported mixed financial results for FY2026.
The Group’s FY26 revenue declined by 11.4% YoY to S$139.6 million due to extended project timelines and resulting delays in revenue recognition. The Group’s overall gross margin increased 18.7% to 11.1% in FY26 from FY25 mainly due to improved margins from its Engineering, Procurement and Construction (EPC) segment. As a result, the Group’s net profit increased 31.3% to S$2.25 million in FY26. The Group announced a proposed final dividend of 0.189 Singapore cents per share, constituting approximately 30% of net profit attributable to owners of the Company in FY2026. Investment Recommendation To account for project delays, we have revised down our FY27 net profit forecast by 35.4% to S$5.3 million. With the substantial pipeline of EPC projects over the next few years, we expect the Group to regain its footing in producing timely project execution and delivery. Sanli is currently trading at a one-year forward P/E of 10.3x. Using the Catalist board valuation as a reference, the median P/E of the Catalist board is 12.0. We maintain our BUY call with a revised price target of S¢18.2, a 20.2% reduction from our previous price target. This represents a 11.6% upside from current levels. |
| LIM & TAN | LIM & TAN |
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SGX ($24.01, down 16 cents) announced that it has divested its wholly owned subsidiary, Scientific Beta, to STOXX Ltd for approximately EUR23 million (S$34 million) as part of its ongoing strategy to optimise its portfolio and redeploy capital towards higher-growth businesses. The sale reflects management’s focus on sharpening SGX’s strategic priorities, particularly within its core securities, derivatives and data franchises, while allowing Scientific Beta to continue expanding under an owner with stronger global distribution capabilities. Following the transaction, SGX will retain its iEdge multi-asset index platform, ensuring that its broader index business remains an integral part of its product offering. SGX’s market cap stands at S$25.7bln and currently trades at 36x forward PE and 11.3x PB, with a dividend yield of 2%. Consensus target price stands at S$22.34, representing 7% upside from current share price. Although steps are taken to boost the SG market such as EQDP funding and reduction of standard board lot size, we think SGX has run its course and valuations now remain lofty. As such, we have a HOLD recommendation on SGX.
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We highlight the key points from Skylink’s ($0.215, up 0.01) just released FY2026 annual report: Our CEO, Wesley Shen founded Skylink’s business in 2017. In just eight years, Skylink Group has grown rapidly to now own and operate one of the largest commercial leasing fleet in Singapore. The fast-growing integrated business ecosystem has steadily expanded, spanning across Commercial Vehicle Leasing, Credit and Engineering business segments. This growth rate has been remarkable. At 21.5 cents, Skylink is capitalized at $57mln and trades at an undemanding 7x forward PE and 2.6% dividend yield. With its steady growth ahead, and 1 year Bloomberg consensus target price of 58 cents, we will keep Skylink on our investment radar over the next few months. |
| DBS GROUP RESEARCH | |
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Oversea-Chinese Banking Corporation Ltd Loan growth outlook continues to be strong
Investment Overview Refocusing on growth engines. OCBC launched a new strategy focusing on the next frontier of growth, which includes deepening core market franchise across its twin hubs Singapore and Hong Kong as well as refreshed strategies within ASEAN domestic markets. Management is guiding for stable to improving ROE, driven by a stronger focus on higher-returning businesses while maintaining cost discipline with CIR at low to mid-40%. OCBC is the only Singapore bank to guide for stable to improving income in FY26F, driven by double-digit growth in non-interest income, while confident of a mid-single digit loan growth.
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