City Developments
Price – $12.69
Target – $13.40

City Developments (CDL) achieved a 55% jump in residential home sales value sold for 2017 despite the absence of new residential launch, on the back of continued healthy uptake for launched local residential properties. Apart from the buoyant sales, the group has also completed 4 land acquisitions which will boost total inventory in the pipeline to 2,750 residential units. Hotel operations are recovering with global Revenue Per Available Room growing 3.2% in constant currency for FY17 led by better occupancies and Average Daily Rates for US and European hotels. CDL’s net gearing ratio of 9% is the lowest for the group on record. Coupled with strong cash reserves of $4b, it is set to capitalise on attractive opportunities globally. The only negative aspect is the slowdown in sales in the group’s largest development in China, Hong Leong City Centre, with 348 units sold in FY17. Nonetheless, the project is still healthy at 86% sold to-date and total sales amounting to Rmb3.5b. Maintain ACCUMULATE. Phillip Securities (5 Mar)

DBS Group Holdings
Price – $28.41
Target – $32.53

DBS Group Holdings (DBS) rose from $26.61 on 1 February to as high as $29.63 gaining 13.4% in less than a month. Year-to-date, the group has recorded a stellar gain of 15.9%. In comparison to the Straits Times Index’s 3.3% growth, DBS clearly outperformed the Singapore market and is also currently the largest market capitalization stock on the Singapore Exchange at $73.8b. DBS posted a good set of FY17 results led by wealth management and higher product sales. Management is upbeat about the outlook underpinned by positive loan growth as a result of renewed interest in the Singapore residential property market, as well as margin improvement due to a more favourable interest rate environment. With the US Federal Reserve Chairman Jerome Powell’s latest comment, most economists are expecting 4 rate hikes in 2018 which we believe will be beneficial to Singapore’s banking sector. We feel that DBS deserves to trade at the same or higher valuation with the re-rating of Asian banks. Maintain BUY. OCBC Investment (5 Mar)

Cityneon Holdings
Price – $1.04
Target – $1.55

Cityneon Holdings (Cityneon) marked a 162.9% increase in FY17 net profit at $17.4m driven by the intellectual property (IP) rights segment. Consequently, gross margins rose to an all-time high of 54.7% reflecting the positive changes in sales mix as the travelling sets toured more than 10 different cities. Cityneon has secured a massive US$60m credit facility with Triple Wise Asset Holdings which allows the group to capitalise on any new IP rights by way of an acquisition or negotiations with brand owner. The Jurassic World exhibition in Chicago has come to a close in Jan-18 with a visitorship of more than 1m attendees while the Transformers Autobots Alliance Exhibition opened its doors in Chongqing in Dec-17. Together with the fourth Avengers S.T.A.T.I.O.N. set for Norrkoping, Sweden in Jun-18, Cityneon’s orderbook is secured for 2018. According to, Landing International will partner with Cityneon to bring exhibitions to Jeju Shinhwa World. The partnership if materialised, would be the first of its kind for Cityneon involving the installation of an exhibition within an integrated resort (IR) and open up possibilities with other IRs around the world. Maintain BUY. UOB-Kay Hian (1 Mar)

Ho Bee Land
Price – $2.48
Target – $3.15

Ho Bee Land’s (Ho Bee) FY17 core EBIT was in line with our estimate with better-than-expected contributions from associates and JVs on stronger China contributions. The group announced a surprise Distribution Per Share (DPS) hike bringing full-year payout to $0.10 which translates into a solid yield of 4%. Going forward, we think that a recurring DPS of $0.08 is sustainable. There was an impairment of $16.8m for the group’s 35% stake in Cape Royale. However, Ho Bee will now explore a possible relaunch of its unsold stock in Sentosa to capitalise on the stronger sentiment in the high-end market. On the back of an impending rebound in Singapore’s office market and strengthening residential market, we raised our valuation for The Metropolis as well as the Average Selling Price for Sentosa units. The stock currently trades at an undemanding 47% RNAV discount which we believe should narrow as market sentiment improves. Maintain BUY. Maybank Kim Eng (1 Mar)

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