A Month Of Meetings And Collaborations

The Wall Street registered losses as Apple-led technology stocks and crude oil prices extended their sharp decline. Over the last two weeks, Dow Jones Industrial Average tumbled 0.4 percent to end the fortnight...

Accrelist Doubles Its Revenue In 1H19

Spearheaded by the Monetary Authority of Singapore and in collaboration with SingEx and partnership with The Association of Banks in Singapore, Singapore FinTech Festival 2018 held this week between 12 till 16 ...
Hi-P Cvr

SI Research: 3 Red Flags Of Hi-P International

Gone were the days when leading integrated contract manufacturer Hi-P International (Hi-P) was trading at the region above $2.50 a share during the first quarter of this year. Within a short time span of slightly more than six months, the share price of this tooling specialist has tumbled by more than 72.1 percent from an all-time high of $2.72 to $0.76 as at 29 October 2018. In line with the heightening negative sentiments around this counter, we point out three red flags with regard to Hi-P’s financials which could be precursors to the group’s deteriorating performances amidst challenging operating environment.

STI Regains Foothold Above 3,000

The Wall Street extended its rebound on the back of oversold conditions and solid corporate earnings, after sharp selloff of stocks last week. Adding on to investors’ woes, Trump had earlier threatened to impos...

SI Research: OUE – Killing Two Birds With One Stone

According to flash estimates released by the Urban Redevelopment Authority on 1 October 2018, the widely-watched private residential property price index has only inched up marginally by 0.5 percent in the third quarter of this year, much lower in contrast to the 3.9 percent and 3.4 percent growth registered in the first and second quarter respectively. Amidst a slowdown in properties sales after the introduction of the latest cooling measures that took effect in July 2018, innovative techniques which developers adopted to raise capital and boost revenue can sometimes be quite an eye-opener. OUE limited is one such case in point.

Investors’ Corner (Hi-P International, Memtech International, SPH REIT, Dairy Farm International Holdings)

Hi-P International (HIP) lowered its earnings guidance for the second time this year expecting lower sales and profit in 3Q18. The guidance cut is due to a delay in billing for certain production tools, lower yields for products undergoing ramp-up as well as lower market demand for certain products. The latter two reasons may be a double-whammy that further accelerates a decline in HIP’s profitability, whose margins are already under pressure given its large fixed cost base amidst an environment of intense pricing competition.

SI Research: We Still Like First REIT Despite Its Struggling Sponsor

Indonesian REITs have not been performing well of late, weighed down by the depreciating Indonesian Rupiah which in turn affected the amount of distribution paid out to unitholders. In contrast to Lippo Malls Indonesia Retail Trust which has plunged 31.3 percent year-to-date, First REIT’s 12.2 percent decline would have been considered mild. This is largely due to the latter’s Indonesia properties’ rentals being pegged to Singapore dollars to mitigate foreign exchange volatility. In spite of this, there are growing concerns in the market recently with regard to the weakening financial health of First REIT’s sponsor, namely Indonesia’s largest property conglomerate Lippo Karawaci.

Investors’ Corner (United Overseas Bank, M1, Valuetronics Holdings, Soilbuild Business Space REIT)

The Federal Open Market Committee (FOMC) raised the US federal funds rate (FFR) by 25 basis points (bps) on 26 Sep-2018, and indicated the possibility of another FFR hike in December with three more to follow next year. Historically, there is a positive correlation between FFR and 3-month SIBOR, which has also risen to an average of 1.63% in 3Q18 from 1.51% in the prior quarter representing a 12 bps q-o-q increment. This will help to widen the 3Q18 net interest margin for United Overseas Bank (UOB). Furthermore, healthy sales in recent property launches indicated that the Government’s property cooling measures in early July might have limited impact on mortgage growth. Meanwhile, UOB pressed on with its plans for a digital bank, which we believed will be positive for its long-term growth as we await more implementation details. Maintain BUY. RHB Research (28 Sep)

Acquisition Stirs Excitement On The Local Bourse

In line with markets’ anticipation, the Federal Reserve raised interest rates by 25 basis points in September, bringing the benchmark rate to a range of 2 percent to 2.25 percent. The central bank also indicate...
North Park Residences

SI Research: Frasers Property – Opportunity Surfaces On Weakened AUD

There is often much investment wisdom to be gleaned from seasoned investor Warren Buffett’s quotes for value investors to ponder over. For instance in a letter Buffett wrote to his shareholders in 2010, the Oracle of Omaha commented that, “Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble.”