Category: SG Stocks And Shares

M1’s Trading Halt

sharing for convenience.

(Bloomberg) — M1 Ltd.’s owners are exploring options including a sale of Singapore’s smallest mobile operator as the city-state gears up for a new entrant into the wireless market, according to people with knowledge of the matter. Keppel Corp., Axiata Group Bhd. and Singapore PressHoldings Ltd. are working with an adviser to conduct a strategic review of their combined 61 percent interest in M1, the people said, asking not to be identified because the discussions are confidential. The carrier, which offers fixed-line and mobile services to more than 2 million customers, has a $1.3 billion market value. The potential sale of Singapore’s third-largest carrier comes as the city-state prepares for the roll-out of a fourth mobile operator with TPG Telecom Ltd. slated to begin wireless services in 2018. The regulator has said it wants to introduce more competition in the city-state to bring down phone bills and improve services. Temasek Holdings Pte has studied ways for Keppel, a portfolio company, to divest non-core assets including its stake in M1, as part of a regular review of investments, people familiar with the matter said in January last year. Executives at the state investment company had also discussed the possibility of Keppel paring its stake in office landlord KeppelREIT. Malaysian wireless carrier Axiata has a 29 percent stake inM1, while Keppel has a 19 percent holding and Singapore Press owns 13 percent, according to data compiled by Bloomberg. A representative for Axiata didn’t immediately respond to emails seeking comment. Representatives for M1, Keppel and SingaporePress didn’t immediately respond to Bloomberg queries. Plans to sell Singaporean telecom stakes have made little progress. Shareholders in the second-largest operator StarhubLtd. were weighing a sale in July, with Qatar’s Ooredoo QSCseeking to sell its indirect stake in the carrier, people familiar with the matter said at the time. The city state’s current telecom operators includingSingapore Telecommunications Ltd. and StarHub are likely to see average revenue per user decline by as much as 16 percent in the next five years, according to OCBC. TPG Telecom may gain the mobile revenue market share of about 6 percent by 2021, the research firm said Friday. 

M1 is now trading at 7.3x EV/Trailing EBITDA, compared to Starhub at 8.15x and Singtel at 15.4x.

Retail Market Monitor: Thursday, March 16, 2017

Expect positive sentiment to spill over to the Singapore market after Fed raised its benchmark rate as expected and on a rebound in oil prices as well as strength in the underlying domestic economy.

As the saying goes, “Buy on rumours, Sell on news”. Apparently, this is not just for capital markets, this holds true even for Foreign Exchange market too.

Yellen announced the rate hike decision last night, citing that the labour market has continued to strengthen and that economic activity has continued to expand at a moderate pace. Job gains remained solid and the unemployment rate was little changed in recent months. Household spending has continued to rise moderately while business fixed investment appears to have firmed somewhat.

Theoretically, a hike in rates will translate to a higher USD. In this case, this did not happen as markets have moved forward and priced in the possibilities earlier. Thus after the announcements of rates, USD plunged shortly after.

Personally I’m watching: Sembcorp marine, Citydev, Parkson Retail, Sunningdale, DBS. Please note that these are my personal observations of which I share with my friends who are watching the market too. In this way, we can exchange and share any information that can help us along the way.

That being said, please watch for entry prices and plan for exit too, it does not mean one can buy in blindly because the broker had mentioned earlier. Usually, it happens only when the price moves down, incurring a paper loss and friends calling me up trying to find out more. The market is like a jungle. Everything is changing, anything can happen. Even the target prices as written in the research reports should be taken as a reference, not an absolute. Ultimately, we are all here to profit from the market.

At the point of writing, Noble dropped 0.015, to a price of 0.194. As mentioned in my earlier email to a friend, I have sold noble already. the upcoming share consolidation is a surprise to all of us. It seems that market is not taking it positively.

*Economy: Economists have raised Singapore’s 2017 GDP growth estimate to 2.3% (previous: 1.5%), nearer MKE’s 2.5% forecast. This was spurred by anticipated improvement in the manufacturing (est: +4.5%, previous: +1.5%) and finance & insurance (est: +2%, previous: +1.8%) sectors.

*SIA: Feb group pax load factor improved 2.4ppts to 80.7%, as passenger traffic growth (+4.1%) outpaced capacity expansion (+0.9%). Load factors rose on promotions across East Asia (+3.5ppts), Americas (+5.6ppts), Europe (+5ppts) and Mid-East/Africa (+6.7ppts), with the exception of SW Pacific (-3.3ppts). Subsidiary carriers’ load factors were mixed with Tigerair (+1.4ppts to 83%) climbing, while Silkair (-0.9ppts to 73.1%) and Scoot (-1.7ppts to 85.1%) slipped. Cargo load factor rose 2.4ppts to 61.4% as capacity contraction (-5.9%) overshadowed decline in carriage (-2.1%). MKE last had a Hold with TP of $9.70.

*Noble: Proposed 10-into-1 share consolidation in a bid to reduce volatility and improve liquidity by narrowing the bid/ask spread, and concurrently soften the impact of speculative orders on the stock.

*Soilbuild Construction: Awarded $149.4m contract by the HDB to build a high rise multi-user food factory at Bedok North Avenue 4. The contract would raise its contract order book to $562.2m. Construction is expected to commence in 1Q17 and will take about 32 months to complete.

*HMI: Received strong interest for its 11-for 200 rights issue, with 145.7% subscription rate. This will raise gross proceeds of $18.5m which will be used to increase its ownership stake in Mahkota Medical Centre and Regency Specialist Hospital to 100% (prior: 48.9% and 60.8% respectively).

*Sarine Tech: Commenced operations at its new 55,000 sf facility in Surat, India, consolidating all of its Surat-based activities for the Indian diamond market under one roof.

*HL Global: Extended the long stop date for proposed disposal of LKN Investment by one month to 15 Apr.

http://www.marketwatch.com/story/text-of-march-fomc-statement-2017-03-15

UOBKH: Retail Market Monitor: Wednesday, March 15, 2017

Investors are expected to take a cautious stance ahead of an expected Fed rate increase and the possibility of further hikes later this year, with banks slated to be potential beneficiaries, but oil-related counters will likely to be dragged by the overnight slump in crude oil prices.

U.K. Prime Minister Theresa May will trigger Article 50 in the final week of March, setting in train Britain’s two-year, slow-motion exit from the European Union. For all the anticipation, the occasion threatens to be as dull as it is momentous. Formally, all that is required to begin the process of disentangling 40 years of political and economic cooperation is a letter.

Closer to home, 2 am tonight will be the interest decision, market probably expecting some profit taking today. Dividend paying counters such as Starhub has taken a beating as a rate hike will render Starhub current dividends unattractive.  While this is only one side of the challenge, personally I think it is more important to note if the dividend payouts are stable and consistent.

Technically, STI is expected to range bound between 3,120 and 3,150.

Stocks to watch:
*Centurion: Received a 9-month lease extension for its 8,600-bed Westlite Tuas dormitory, which constitutes 25% of its total bed capacity in Singapore, wef 29 Apr ’17. MKE last had a Hold with TP of $0.41.

*Sunright: 1HFY17 net profit grew 31% to $2.4m, as revenue rose 9% to $70.1m, stemming from increased contribution from burn-in, testing and electronic manufacturing services. Margins were augmented by reduced raw materials and consumables used. NAV/share at $0.582.

*Vibrant: 3QFY17 net profit slumped 85.2% to $1.3m, dragged by lower associate income of $0.4m (-85%) due to reduced takings from Plaza Ventures and Figtree. Revenue of $53.5m (+23.6%) was supported contribution from the government resettlement housing development projects in Jiangyin, China, but partially offset by a dip in freight and logistics sales following the disposal of the loss-making ISO tanks business. Gross margin expanded to 28.9% (+1.3ppts), while bottom line was weighed by a fair value loss of $0.8m (3QFY17: $7.3m gain) and lower FX gain of $0.4m (-87%). NAV/share at $0.623.

*Ipco: 3QFY17 net profit fell 12% to $5.3m on a 18% drop in revenue to $12.2m, due to lower demand for burn-in boards by semiconductor manufacturers, as well as a decline in natural gas piping installations to new households in China. NAV/share at $0.02.

*Spackman: Acquiring Korean movie equipment rental firm Frame Pictures for KRW900m (US$0.8m) and 1.63% of share capital in 24.53%-owned Spackman Media Group. This will narrow pro forma FY16 LPS to US$0.37¢ from US0.56¢.

*Atlantic Navigation: Awarded a one-year charter contract for its lift boat worth US$44m, attached with two one-year extension options. The vessl is expected to be deployed in early-May after the completion of retrofitting work.

*Regal Int’l: Entered into a project management cum construction agreement with an independent third party, for the development and construction of 20 units of terrace houses and eight units of spektra plus terrace houses in Kota Samarahan, Sarawak, Malaysia. The third party is the 1.44ha land owner and developer of the project.

*KrisEnergy: Appoints Kelvin Tang, VP of Legal and President of its Cambodian operations as COO wef today and promoted Sally Ting to General Counsel. Meanwhile, founding executive directors Richard Lorentz (director of business development) and Chris Gibson-Robinson (director of E&P) will step down from the board on Apr 24 and become advisers to the CEO, a post that remains vacant.

*Swiber: Unable to pay the upcoming coupon for its CNY450m 7.75% fixed rate notes due on Mar 20. Company is under judicial management and remains suspended.

13 – 17th March 2017 market update


This week will be a week filled with major announcements. ECB Mario Draghi’s speech and FED Janet Yellen’s speech. And as always, equities are always forward looking. So it is possible that the current prices are all been factored in of the upcoming announcements.

Investing clients, do watch for banks shares. Avoid oil and gas counters as mentioned since last year. My 2 cents.

Currently watching

Parkson – Sell volume is lesser than buy volume, indicating more who bought and held the shares.

Sunningdale – possible take over?

Noble – Personally will only buy if it is below 0.200 or lower. Only for trading, not for investing.

IFS capital – a sudden breakout. still watching.

*O&M: Rigbuilders Keppel Corp and Sembcorp Marine could continue to see profit-taking as share prices may have run ahead of fundamentals, in the absence of new contract wins or an end of the impairment cycle. To recap, both counters strongly outperformed YTD following several street ratings upgrade on the back of improved sentiment in the oil market.

*Neo Group: Entered into an exclusive dealing agreement to acquire Asia Farm F&B, a manufacturer of fruit cordials and syrups, juices, sauces, puddings and jellies.

*Zico: Commenced business for its asset management business as a registered fund management company, targeting high net worth and family office clients focused on the Asean region.

*Axcelasia: Acquiring Malaysia-based business and corporate governance consultancy firm, Audex Governance, for RM2.9m. The acquisition will allow it to tap on Audex’s base of customers and facilitate cross-selling of services. Audex currently has RM2.1m worth of contracts.

*Sysma: 1HFY17 net profit surged 857.5% from a low base to $4.8m, mainly boosted by write-backs on provision of $3.6m. However, revenue slumped 40.4% to $40.5m on reduced contribution from property development (-84.6%), although partially offset by increased sales in construction (+23.4%). Gross margin expanded to 19.8% (1HFY16: 5.9%), in line with the shift in business mix. NAV/share at $0.182.

*Blackgold: Proposed placement of 39.5m new shares (5% share capital) at $0.0901 each to private investor and consultant to the company, Johanes Budisutrisno Kotjo. Net proceeds of $3.5m will be used for working capital.

*Natural Cool: Received letter of demand from former Chief Corporate Officer Ng Quek Peng, seeking $2.5m for alleged wrongful termination of his service.

*Strategy: The privatisation theme is back into the spotlight following the wave of recent M&A on attractive valuations. Cash-rich firms include Sunningdale Tech, Fu Yu, UMS, Venture and PEC, while undervalued asset plays include PACC Offshore, Bukit Sembawang, GuocoLand, GL and Ho Bee.

*GLP: Updated that it signed 69,000 sqm of new leases in China and Japan over the past three months.

*Silverlake Axis: Exploring the possible acquisition of private entities linked to its chairman, Goh Peng Ooi. This comes after a short selling report alleged that the private entities had engaged in transactions with Silverlake to inflate the latter’s results.

*Spindex: Independent directors have received a letter from Hong Wei (the privatization party led by controlling shareholder and chairman Tan Chang Chai), stating that any offer from Northstar can no longer be considered valid as it will not be able to turn unconditional, given Hong Wei has already secured 50.30% ownership. Further, it stated that Rule 9.2 of the Takeover Code is no longer applicable and objects to Spindex granting due diligence access to a rival firm.

*Nordic Group: 4Q16 net profit jumped 15% to $3.8m, bringing FY16 earnings to $12.8m (+21%). Quarter revenue fell 10% to $18.9m, dragged by both maintenance (-24%) and project services (-3%) segments, but bottom line was shored by $1m FX gain. Higher final DPS of 0.731¢ brings full year payout to 1.2682¢ (FY15: 1.05¢). NAV/share at $0.17.

*TTJ: 2QFY17 net profit dived 43.1% to $3.1m, on a 30% slump in revenue to $20m from weak contribution in both structural steel and dormitory businesses. Gross margin contracted 0.4ppts to 26.2% on a dip in dormitory margin, but was partially mitigated by better profitability for structural steel projects. Bottom line was dragged by lower FX gains of $8,000 (2QFY17: $0.6m). NAV/share at $0.364.

*LHN: Touted that its efforts to expand its space optimization and real estate management expertise into the China market was endorsed by Minister of State for National Development Koh Poh Koon.

*Regal: 55% owned Million Sunray entered into a MOU with ASX-listed iBosses, to explore collaboration in developing an Islamic Entrepreneurship program in Malaysia.

SGX proposes bringing back lunch breaks for traders

SINGAPORE: Singapore Exchange (SGX) launched a public consultation on Wednesday (Mar 8) on bringing back a lunch break for traders and increasing the minimum bid sizes for some stocks.
The proposed lunch break will take place from 12pm to 1pm. SGX in 2011 scrapped the mid-day break – which was then from 12.30pm to 2pm – saying it could boost trading by as much as 10 per cent.
“Market feedback indicates that while the benefits of continuous all-day trading remain relevant, market participants prefer shorter trading hours,” SGX said in a news release.
“The timing of the proposed mid-day break allows us to retain significant overlap in trading hours with key markets in Asia, which was one of the key intended benefits of continuous all-day trading, and coincides with the generally lower trading activity of the day,” it added.
During the break, market participants can continue to enter and manage their orders. SGX will publish an indicative equilibrium price based on the orders received in the order book to facilitate price discovery and enable investors to better manage their risks, it said.
The exchange operator has also proposed to increase the minimum bid size for stocks and relevant securities trading in the S$1 to S$1.99 price range from the current S$0.005 to S$0.01.
The proposed change is based on a decline in traded value and lower retail participation in the S$1 to S$1.99 price range, SGX said.
“A wider minimum bid size could generate more viable trading opportunities taking into consideration total transaction costs for some segments of the market, such as retail traders. This in turn may promote a more balanced mix of participants for securities in this price range,” it said.
SGX also said it wants to widen the forced order range for stocks and relevant securities from the current +/- 20 bids to +/- 30 bids, in response to market feedback to improve order entry efficiency.
“SGX constantly reviews its market structures, rules and policies, taking into account changing market conditions, regular dialogue with the industry, and supportive data analysis,” said CEO Loh Boon Chye.
The public consultation is open until Mar 29, and feedback can be sent to rules@sgx.com.

SGSAS query: Noble Accumulation? Or?

Question:hi,do u have an opinion on noble group? looks like accumulation at the 20c – 22c range.Ans:morning,Personally my last batch i got it at 0.176 and sold 225. unless it goes below 0.200, i will not touch it now.depends if you are a trader or inve…

Lee Metal at least 6% dividends since 2009!!

been looking ard for something other than Banking shares. In fact, bank shares are a little too high for now. Lee Metal issues about 6% dividends or more constantly. Certainly better than some blue-chip shares. Noticed this as the volume has been increasing and chart wise it has been moving out of the down channel for a while.

I compiled some info for referencing. Available for CPF investing too.

Profitable since 2005 (that’s as far as I can go from the 2009 annual report)
Despite being in a cyclical industry, Lee Metal has been profitable since 2005, even in 2008/2009.

S$m
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Sales
690.3
1,112.5
1,537.7
1,471.4
983.9
831.5
773.6
696.2
635.9
519.3
445.4
318.6
Net profit
7.1
10.3
15.5
20.4
29.9
22.5
18.9
26.9
40.2
33.1
15.6
13.3
EPS
0.020
0.025
0.035
0.040
0.058
0.048
0.040
0.057
0.085
0.070
0.033
0.028
DPS
0.002
0.018
0.012
0.013
0.030
0.025
0.020
0.025
0.035
0.030
0.020
0.020
payout
10.2%
71.1%
34.0%
32.6%
51.7%
52.1%
50.1%
44.1%
41.4%
43.0%
61.0%
71.2%

STRONG free cash flow generation yield of more than 20%!! In the last 3 years
While profit has declined with the tough environment, FCF yield has remained at least 9% in the last 5 years. For FY16, generated 20% free cash flow yield!!!

2012
2013
2014
2015
2016
OCF          63.5          23.7          43.6          74.1          31.1
Capex        (13.0)        (10.7)          (5.5)        (19.9)          (2.8)
FCF          50.5          13.0          38.1          54.3          28.3
PBT          32.0          47.9          37.6          18.4          14.8
Dep            4.9            7.0          10.1          11.8          10.7
FCF yield
36.1%
9.3%
27.2%
38.8%
20.2%
FCF/share        0.106        0.027        0.080        0.114        0.060

With its strong cash flow generation- has moved from net debt of S$80m in 2013 to net cash of S$8.5m in just 3 years, and that is while paying S$0.085 of dividends in total from 2013-2015!

2012
2013
2014
2015
2016
cash
25.2
50.0
46.1
68.7
69.1
fixed deposit
48.7
65.2
42.9
27.8
28.8
debt
(139.2)
(195.8)
(142.5)
(105.3)
(89.3)
net cash
(65.2)
(80.7)
(53.5)
(8.9)
8.5

Good pay master
Has been constantly paying out dividends. While DPS was cut in 2015, it still translates to 6.8% yield.

2012
2013
2014
2015
2016
DPS
0.0250
0.0350
0.0300
0.0200
0.0200
EPS
0.0567
0.0846
0.0698
0.0328
0.0281
payout
44.1%
41.4%
43.0%
61.0%
71.2%
FCF yield
36.1%
9.3%
27.2%
38.8%
20.2%
FCF/share
0.106
0.027
0.080
0.114
0.060
dividend yield
8.5%
11.9%
10.2%
6.8%
6.8%

Improving outlook?- is the worst over? , coming off a low base?

We note that profit has dropped from S$40m in 2013 to S$13.3m in 2016. (although we note that part of it is due to higher depreciation expense (non-cash)) . 2017 construction demand is expected to be between $28b-35b , similar to 2016 of $27b-34b. + Steel prices have been on the rise…

Valuations: Currently trading at 10.5x PE, not cheap. But given the strong free cash flow generation and good dividend yield and excellent track record of earnings. Believe it is worth a look (esp with the volume in the chart see next few pages)

Daily chart- interesting surge in volume with prices remaining stable between S$0.29-0.295.

Weekly chart

Look at the long monthly tails in 2015- breakout to S$0.355

Dividend Payouts over the last 10 years

Dividend Yield(TTM) = 6.90%

Year Yield Amount Ex Date Pay Date Particulars
2017 3.45% SGD 0.01 2017-04-26 2017-05-22 SGD 0.01 ONE-TIER TAX
2016 6.90% SGD 0.003 2016-11-21 2016-12-09 SGD 0.003 ONE-TIER TAX
SGD 0.005 2016-08-31 2016-09-15 SGD 0.005 ONE-TIER TAX
SGD 0.002 2016-06-08 2016-06-24 SGD 0.002 ONE-TIER TAX
SGD 0.01 2016-04-27 2016-05-23 SGD 0.01 ONE-TIER TAX
2015 6.90% SGD 0.003 2015-11-23 2015-12-11 SGD 0.003 ONE-TIER TAX
SGD 0.005 2015-09-01 2015-09-16 SGD 0.005 ONE-TIER TAX
SGD 0.002 2015-06-08 2015-06-24 SGD 0.002 ONE-TIER TAX
SGD 0.01 2015-04-28 2015-05-22 SGD 0.01 ONE-TIER TAX
2014 12.07% SGD 0.003 2014-11-24 2014-12-12 SGD 0.003 ONE-TIER TAX
SGD 0.005 2014-09-01 2014-09-16 SGD 0.005 ONE-TIER TAX
SGD 0.002 2014-06-06 2014-06-24 SGD 0.002 ONE-TIER TAX
SGD 0.01 2014-04-28 2014-05-23 SGD 0.01 ONE-TIER TAX
SGD 0.015 2014-04-28 2014-05-23 SGD 0.015 ONE-TIER TAX
2013 8.62% SGD 0.003 2013-11-25 2013-12-13 SGD 0.003 ONE-TIER TAX
SGD 0.005 2013-08-30 2013-09-16 SGD 0.005 ONE-TIER TAX
SGD 0.002 2013-06-06 2013-06-24 SGD 0.002 ONE-TIER TAX
SGD 0.005 2013-04-30 2013-05-23 SGD 0.005 ONE-TIER TAX
SGD 0.01 2013-04-30 2013-05-23 SGD 0.01 ONE-TIER TAX
2012 6.90% SGD 0.003 2012-11-23 2012-12-14 SGD 0.003 ONE-TIER TAX
SGD 0.005 2012-08-29 2012-09-14 SGD 0.005 ONE-TIER TAX
SGD 0.002 2012-06-05 2012-06-22 SGD 0.002 ONE-TIER TAX
SGD 0.01 2012-05-03 2012-05-25 SGD 0.01 ONE-TIER TAX
2011 8.62% SGD 0.003 2011-11-29 2011-12-16 SGD 0.003 ONE-TIER TAX
SGD 0.005 2011-08-29 2011-09-16 SGD 0.005 ONE-TIER TAX
SGD 0.002 2011-06-07 2011-06-24 SGD 0.002 ONE-TIER TAX
SGD 0.01 2011-05-03 2011-05-27 SGD 0.01 ONE-TIER TAX
SGD 0.005 2011-05-03 2011-05-27 SGD 0.005 ONE-TIER TAX
2010 6.90% SGD 0.003 2010-11-29 2010-12-17 THIRD SGD 0.003 ONE-TIER TAX
SGD 0.005 2010-08-30 2010-09-17 SGD 0.005 ONE-TIER TAX
SGD 0.002 2010-06-14 2010-06-25 FIRST INTERIM SGD 0.002 ONE-TIER TAX
SGD 0.01 2010-05-03 2010-05-27 SGD 0.01 ONE-TIER TAX
2009 6.90% SGD 0.003 2009-11-26 2009-12-18 THIRD INTERIM SGD 0.003 ONE-TIER TAX
SGD 0.005 2009-08-21 2009-09-11 SGD 0.005 ONE-TIER TAX
SGD 0.002 2009-06-08 2009-06-25 SGD 0.002 ONE-TIER TAX
SGD 0.01 2009-04-30 2009-05-28 SGD 0.01 ONE-TIER TAX
2008 4.48% SGD 0.003 2008-08-21 2008-09-12 SGD 0.003 ONE-TIER TAX
2008-08-11 1 WT FOR 5 SH OFFER OF 1 FOR 5 @ SGD 0.05
SGD 0.01 2008-04-25 2008-05-15 SGD 0.01 ONE-TIER TAX
2007 3.45% SGD 0.002 2007-08-20 2007-09-05 (LST INTERIM) SGD 0.002 LESS TAX
SGD 0.008 2007-04-27 2007-05-16 SGD 0.008 LESS TAX