Aug[8] - Market Updates

US:
Following comment from Yellen last Friday, US 10 years treasuries yield and US dollar index surged together. Generally, stronger USD could weaken commodity prices, such as oil, gold, agriculture, etc. Rate hike was one of the main reason for downfall across global indices on mid 2015 as well. It shall back to the market themes in coming days again.

Singapore:
Domestic banks led STI for short bullish run last week. Rate hike is generally benefiting banks. However, it also add more burden for loan repayment especially on oil companies. It would be interesting to see whether local banks will continue the up movement and cheer with rate hike prospect.

Market Calendar on coming week:
(SG: Singapore; CH: China; UK: United Kingdom; US: USA)

Aug[7] - Singpost (Back to where it began)

COUNTER: Singapore Post Limited

OVERVIEW:
The well known local group is running national postal service.  It provides domestic and international postal and courier services. It also offers end-to-end e-commerce logistic solutions.

HIGHLIGHTS:
[1] Latest result saw 1Q2016 revenue leap 31% year on year. Major contribution was due to newly acquisition in eCommerce sector. Overseas segment grew up to 50% of total revenue.

[2] Its underlying net profit down 4%. Property segment down 21% because SPC retail mall is undergoing re-development. eCommerce segment registered net loss $3.5m due to continued investment in IT and operational capabilities in newly acquired business. Other segments showed stable earning.

[3] The group is in net short term liability position of S$141m. Total debt/equity ~ 30%. Management indicated sufficient banking lines for its funding needs. Most of the debt incurred for newly acquisition last year.

[4] Alibaba shall buy into additional 5% shares into the group as well as 34% stake in one joint-venture with the group, but subject to regulatory approval. The latest extension saw long-stop date falling on end of Oct. Shall the deal goes through, new injected fund could fully satisfy net liability of the group.

[5] Management revealed dividend policy under review. It might not longer pay annual dividend at 0.075 per shares as consistently as before.

INVESTMENT THEMES:
[1] Current valuation is attractive: PE~ 12.6, which is at lower zone in historical P/E chart. 

[2] The group is under transformation period meantime, thus higher finance expense and operation cost is incurred. Recent results show that the revenue income is growing tremendously with contribution from new business. Long term investor could take the recent downfall as chance to take part in the group's long term dream as regional logistics hub in future. 

PRICE TREND:
On 2014 May, the group issued new shares at $1.42 to Alibaba. Price shot up to 1.5 and followed with superb bull trend subsequently. Since 2016, it experienced management turnover, and investigation into corporate governance. Current price strength has been heading south. Strong support could be 1.29~ 1.32. Shall future dividend payout be reduced less than 10%, current price range still look attractive with dividend yield > 5%. The counter is mixed with both value and growth prospects.

*** Note: Same counter has been mentioned in Nov[5] 2015 ***  

Chart[22] - Dutech

The counter saw heavy buying volume twice. First happened on Jun (upon latest result being announced), and second on last week. Price broke up from resistance, 0.49. Next resistance is 0.595 which is its debut price in SGX on 2007. Current trend looks bullish, except significant selling pressure appears.

Aug[6] - Market Updates

Singapore:
1H2016 result period ended with non-aspiring results. STI continued its movement within side-way channel, 2810 to 2894. Silent trend meanwhile.

Market Calendar on coming week:
(SG: Singapore; CH: China; UK: United Kingdom; US: USA)

Aug[5] - Global Inv (Benchmark for cash-recurring portfolio)

COUNTER: Global Investments Limited

OVERVIEW:
Incorporated in Bermuda, the counter is an open ended mutual fund which focus on public equity (diversified sectors) and fixed income markets across the globe. The fund invests primarily in operating lease assets, loan portfolio and securitization assets, etc. Its aim is to generate steady income and potential capital appreciation. It is managed by Singapore Consortium Investment Management Ltd, which holds a capital market services licenses for fund management issued by MAS.

HIGHLIGHTS:
[1] Latest financial result saw stable earning for 1H2016. Higher interest income is due to higher investment (40% to 60%) in bond portfolio.

[2] Asset portfolio mainly invest in bonds with half distribution in USD. Contigent convertibles bonds (COCOs financials) occupy 50% of its bonds portfolio. Another 50% is well diversified in various sectors. Total assets expose to three currencies, SGD (33%), USD (30%) and EUR (17%).

[3] The counter is in net cash position without any borrowing.

INVESTMENT THEMES:
[1] 1H2016 registered net asset value and dividend at 0.192 and dividend 0.0075 per shares.
      Current valuation @ 0.139 is attractive: PB ~ 0.7 || Dividend yield ~ 11% || PE ~ 11 
     
[2] The counter has been generating stable revenue over past four years. Its return of asset and return of equity maintained ~5% throughout.

[3] It's portfolio composition allows investors to look forward stable dividend yet potential capital gain. Management is also actively re-allocating investment to cope with changing market conditions.

PRICE TREND:
The counter will enter EX (exclusive of dividend) on 22 Aug (tomorrow). It is expected to fall on immediate support 0.128, which translates to 12% dividend yield. Interestingly, historical chart shows that EX dates on August used to be good buying window into the counter as refer to red arrow below. Since price tends to move up till next year afterwards.

Aug[4] - Market Updates

Singapore:
STI welcomed little surge on last Monday, but ended the rest of days upon national day with quiet movement. Immediate support at 2813, and immediate resistance at 2955. Direction is unclear.

Market Calendar on coming week:
(SG: Singapore; CH: China; UK: United Kingdom; US: USA)

Aug[3] - Financial Highlights

The following counters released respective latest financial results last week. A summary is provided.
DBS, SMRT, China Sunsine, CNMC Goldmine, ThaiBev, SingTel, Ezion, ST Eng, Tianjin Zhongxin, Centurion, Global Logistics, Asian Pay TV Trust, Ying Li

Chart[21] - Counters hitting Support

DBS will announce latest result on tomorrow (8 Aug). Following its involvement in Swiber saga, the result could draw more attention from market. It would be interesting to see whether support 14.6 can persist. The counter shall issue dividend at same time as well

OCBC price falling upon dividend expiry date unsurprisingly. Current price is hovering above support, 8.25, which is slightly above its book value, 8.19. It also represent dividend yield ~ 4.3

Recent downfall of crude oil induced selling pressure on Keppel Co. Price might have found support between 5 to 5.2, shall oil price stabilize. It ever fall to 4.8 when oil plunged to USD26





Singpost latest results saw rising operational expense as well as financial cost during its transition period towards regional eCommerce player. Recent downfall paused at support, 1.42. Market could be waiting for more details about its joint venture plan with Alibaba and dividend policy in future.

Aug[2] - Market Updates

US:
Following series of positive economy data from US job market and factory production, Dollar index slowly climbed up while Gold price showed double top formation in trend. Market might be hinting that further rate hike is around the corner. Next US federal meeting falls on Sep. It could be back to the market focus on coming months.

Singapore:
DBS heavy exposure into loan from oil&gas sector has been taking its toll in market. Local banks counters were leading STI to another week of downfall. Immediate support at 2812. Shall it be broken, next would be 2706.

Market Calendar on coming week:
(SG: Singapore; CH: China; UK: United Kingdom; US: USA)

Aug[1] - Financial Highlights

The following counters released respective latest financial results last week. A summary is provided.
OUE HTrust, Neratel, Ara Asset, Sembco Ind, Talkmed, Starhub, Singpost, Global Invacom, Bumitama and Global Investment