SI Research: Q&M Dental Group – When A Growth Stock Fails To Grow

The market tends to accord a high price-to-earnings (P/E) valuation for companies that exhibit greater potential for growth. However, when the performances of such companies fail to meet expectations, the drop in earnings per share resulting in a higher P/E valuation would act as a double-blow to the share price, often leading to a subsequent plunge that could sometimes be jaw-dropping. At one time the historical P/E ratio of Q&M Dental Group (Singapore) (Q&M Dental) went as high as 67 times when its shares were trading at $0.98 back in May 2015.
soilbuild Cvr

SI Research: Three Concerns About Soilbuild Business Space REIT’s Distributions

The US Federal Reserve raised the benchmark interest rate from 1.75 to two percent on 13 June 2018 and signaled two more hikes to be on the way, implying a total of four increases this year. While the rate hike in June was widely within expectations, the quickening pace of rate increases still got on investors’ nerves. Bonds and high-yield instruments such as Real Estate Investment Trusts (REITs) took the biggest hit as FTSE ST Real Estate Investment Trusts Index registered a year-to-date decline of more than 9.4 percent to 774.83 as at 25 June 2018.
BW convention

Best World Hits New Milestone

Listed on the Mainboard of the Singapore Exchange, Best World International (Best World) specializes in the development, production and distribution of premium skincare, personal care, nutritional and wellness ...

Investors’ Corner (Mapletree Logistics Trust, Delfi, Singapore Airlines, Singtel)

The ongoing trade friction between the US and China has casted a dark cloud over the outlook of global trade and logistics-related securities. With the recent acquisition of a 50% interest in each of 11 logistics properties in China on 6 Jun, an estimated 11% of Mapletree Logistics Trust’s (MLT) pro forma FY18 net property income is expected to derive from China as compared to 6% previously. While MLT’s increased exposure to China amid the current trade spat may raise some concerns, we believed that a significant portion of its underlying end-user revenue from China is derived domestically attributable to the fast growing e-commerce sector and hence, the impact on MLT’s earnings could be limited. Taking into account the acquisition and recent private placement exercise, we trimmed FY19F and FY20F DPU forecast by 0.9% and 0.8% respectively.

Markets Slip As Trade War Fears Dial Up A Notch

Global stocks extended their decline on renewed trade war concerns that cast a dark cloud on global markets. Trump has announced that his administration will impose tariffs on US$34 billion worth of Chinese imp...

SI Research: BRC Asia – Opportunity Amidst Crisis

Market bulls hardly had much time to rejoice following US and Chinese officials’ joint statement pledging commitment to address their trade concerns, before being caught by surprise 10 days later by President Trump’s unexpected move to reinstate tariffs on US$50 billion of Chinese imports in mid-June. Meanwhile Europe, along with Canada and Mexico, threatened a retaliation to hit back with levies on American exports should Trump administration decided to proceed with imposing tariffs on steel and aluminum imports from Europe. With a global trade war looming on the horizon, investors have reasons to be concerned.

Investors’ Corner (Sasseur REIT, City Developments, Sunpower Group, Sembcorp Industries)

Sasseur REIT (Sasseur) offers a unique and compelling investment proposition with its portfolio of 4 outlet mall properties in China’s Tier-2 cities of Chongqing, Hefei and Kunming. Outlet malls are at the forefront of China’s fast-growing retail format and are potent draws for the burgeoning middle class with a combination of premium product offerings, discounted prices and malls that incorporate lifestyle elements. Hence, we foresee Sasseur’s market to grow at 24% CAGR from 2017 – 2021E. There is downside protection to Sasseur’s distributions as operational risks are transferred to its sponsor through embedded entrusted management agreements structures, which provide for minimum fixed rents with upside potential via a variable component linked to the sales performance of its retail tenants. In addition, acquisition outlook is supported by $700m - $850m of debt headroom as well as 2 right-of-first-refusal assets and 3 third-party pipeline properties which could potentially triple its existing net lettable area. Initiate BUY. Maybank Kim Eng (7 Jun)

A New Chapter Towards Peace In Korean Peninsula

This fortnight’s focus was on the historic Trump-Kim Summit, which went on exceptionally well considering the fact that the two leaders were exchanging hostile remarks not too long ago. The short summit conclud...
Courts Cvr

SI Research: How Would The Lifting Of GST Change The Fate Of Courts Asia

The 14th Malaysian general election concluded with a surprising outcome as the opposition Pakatan Harapan alliance pulled off a decisive victory against Barisan Nasional, ending the latter’s 61-year rule of the country since independence. True to its pre-election promise, the new government subsequently announced on 16 May 2018 the abolishment of the 6 percent Goods and Services Tax (GST) with effect from 1 June 2018. This brought cheers among Malaysians who have long been burdened by the rising cost of living. Even neighboring Singaporeans are also tempted to open their wallets to shop across the causeway given the relatively cheaper price tag of goods now.