April 2014
Results Announcement
- 11 Apr 14 : SPH (Q214 – Feb14) – EPS 5ct (todate 11ct) ; Div 7ct
- 14 Apr 14 : M1 (Q114) – EPS 4.6ct
- 24 Apr 14 : HLFin (Q114) – Annualised EPS 13.04ct vs 13.82ct (Q113)
- 9 May 14 : SBSTransit
- 12 May 14 : ComfortDelgro
- 15 May 14 (AM) : Singtel
- 22 May 14 (AM) : SATS
STI = 3264.71 (+76.09 for April)
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
Hong Leong Fin |
FY13 (Dec) |
15.85 |
12.00 |
$2.750 |
4.364% |
17.35 |
Interim 4ct ; Final 8ct |
|
SingPost |
FY13 (Mar) |
6.435 |
6.25 |
$1.415 |
4.417% |
21.99 |
Q1, Q2, Q3 1.25ct ; Q4 2.5ct |
|
SPH |
FY13 (Aug) |
27 |
22.0 |
$4.190 |
5.251% |
15.52 |
Interim 7ct ; Final 8ct + Special 7ct |
Aviation Services
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SATS |
FY13 (Mar) |
16.60 |
15.0 |
$3.170 |
4.732% |
19.10 |
Interim 5ct ; Final 6ct + Special 4ct |
|
SIA Engineering |
FY13 (Mar) |
24.51 |
22.0 |
$4.790 |
4.593% |
19.54 |
Interim 7ct ; Final 15ct |
|
ST Engineering |
FY13 (Dec) |
18.73 |
15.0 |
$3.820 |
3.927% |
20.40 |
Interim 3ct ; Final 4ct + Special 8ct |
Note : SATS Special Div is Observed to be Non-Recurring
Transport
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SBSTransit |
FY13 (Dec) |
3.62 |
1.80 |
$1.250 |
1.440% |
34.53 |
Interim 0.9ct ; Final 0.9ct |
|
ComfortDelGro |
FY13 (Dec) |
12.43 |
7.00 |
$2.120 |
3.302% |
17.06 |
Interim 3ct ; Final 4ct |
|
SMRT |
FY13 (Mar) |
5.5 |
2.50 |
$1.220 |
2.049% |
22.18 |
Interim 1.5ct ; Final 1.0ct |
TELCO
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SingTel |
FY13 (Mar) |
22.02 |
16.8 |
$3.830 |
4.386% |
17.39 |
Interim 6.8ct ; Final 10ct |
|
M1 |
FY13 (Dec) |
17.4 |
21 |
$3.360 |
6.250% |
19.31 |
Interim 6.8ct ; Final 7.1ct + Special 7.1ct |
|
StarHub |
FY13 (Dec) |
21.50 |
20 |
$4.150 |
4.819% |
19.30 |
Q1 5ct ; Q2 5ct ; Q3 5ct ; Q4 5ct |
Infrastructure
|
Stock |
Period |
DPS cts |
Mkt |
Yield |
NAV |
Div Breakdown |
|
SPAus |
1H – Sep13 |
A4.18 (Gross) |
$1.615 |
6.030% |
A$0.92 |
1H14 A4.18ct ; 2H13 A4.1ct |
* SPAus DPU in A$. Yield is Calculated Using Latest Exchange Rate (1.1648) fm Yahoo
NOTES :
- Mkt Price is as on 30-Apr-14
- HLFin : 2H13 (Dec) – 8ct ; 1H13 (Jun) – 4ct
- ST Engg : 2H13 (Dec) – 4ct (Final) + 8ct (Special) ; 1H13 (Jun) – 3ct
- MIIF : 2H13 (Dec) –0.7ct
- ComfortDelgro : Q413 (Dec) –4ct ; Q213 (Jun) –3ct
- SBSTransit : Q413 (Dec) – 0.9ct ; Q213 (Jun) – 0.9ct
- StarHub : Q413 (Dec) – 5ct ; Q313 (Sep) – 5ct ; Q213 (Jun) – 5ct ; Q113 (Mar) – 5ct
- StarHub : FY14 Div Guidance – 5ct/Q
- SingPost : Q314 (Dec13) – 1.25ct ; Q214 (Sep13) – 1.25ct ; Q114 (Jun13) – 1.25ct
- SPAus : 2H13 (Mar13) – A4.1ct = A1.367ct (Franked) + A2.649ct (Interest) + A0.084ct (Capital Returns) ; 1H14 (Sep13) – A4.18ct = A1.393ct (Franked) + A2.396ct (Interest) + A0.391ct (Capital Returns)
- SingTel : 1H14 (Sep13) – Interim 6.8ct
- SIAEC : Q214 (Sep13) – Interim 7ct
- SATSvcs : 1H14 (Sep13) – Interim 5ct
- SMRT : Q214 (Sep13) – Interim 1ct
- SPH : 2H13 (Aug) – Final 8ct + Special 7ct ; 1H13 (Feb) – Interim 7ct
- MIIF : FY13 Guidance 2H13 (Dec) –0.8ct (Final) ; CXP Return of Capital = 9.7ct
- M1 : 1H13 (Jun) – Interim 6.8ct
- MIIF : FY13 Guidance 1H13 (Jun) –0.7ct ; 2H13 (Dec) – 1.2ct (Final) ; APTT IPO Entitlement / 1000 MIIF Shares (Estimate) = 457 APTT Shares or $443.29
- SPAus : FY14 Guidance = A8.36ct
- SingTel : Div Policy – 60% to 75% of Underlying Net Profit
SMRT – Maybank Kim Eng
Share price surged… avoid the hype
- Share price surged 18.5% to its highest since 10 Dec.
- While a favourable transition of its business model is likely, this surge is speculative in the absence of announcements by the regulators or operators.
- Maintain Sell with TP of SGD0.60, based on 14x average EPS for FY3/14-16.
SMRT’s share price surged…
SMRT’s share price surged by 18.5% to close at its highest in almost five months, stoking speculations of impending corporate developments. In response to this, the stock exchange’s surveillance department has issued a query to which SMRT has replied that they are not aware of any news that has caused the price surge.
… Avoid the hype; maintain SELL
In our view, there are two possible corporate developments:
1) Nationalisation of SMRT via a general offer. This allows SMRT to run as a non-profit organisation. However, we think this is unlikely as Singapore’s Transport Minister had previously argued against nationalisation on ground that nationalisation may lead to higher fares and become a burden on taxpayers.
2) Favourable transition to new business model for fare-based business. This is a more likely scenario. SMRT’s core fare-based business suffered an operating loss of SGD32m in 2013 and is expected to remain a key drag to profitability in the future. While a change is imminent, it is highly speculative to conclude that the terms will be favourable to shareholders. In particular, we are concerned over the treatment of the asset purchase obligations under the old rail financing regime (note). In the absence of material announcements, we advise investors to stay cautious. SMRT trades at a rich valuation of 30x FY3/15E P/E. Maintain SELL with TP of SGD0.60.
SMRT – Maybank Kim Eng
Share price surged… avoid the hype
- Share price surged 18.5% to its highest since 10 Dec.
- While a favourable transition of its business model is likely, this surge is speculative in the absence of announcements by the regulators or operators.
- Maintain Sell with TP of SGD0.60, based on 14x average EPS for FY3/14-16.
SMRT’s share price surged…
SMRT’s share price surged by 18.5% to close at its highest in almost five months, stoking speculations of impending corporate developments. In response to this, the stock exchange’s surveillance department has issued a query to which SMRT has replied that they are not aware of any news that has caused the price surge.
… Avoid the hype; maintain SELL
In our view, there are two possible corporate developments:
1) Nationalisation of SMRT via a general offer. This allows SMRT to run as a non-profit organisation. However, we think this is unlikely as Singapore’s Transport Minister had previously argued against nationalisation on ground that nationalisation may lead to higher fares and become a burden on taxpayers.
2) Favourable transition to new business model for fare-based business. This is a more likely scenario. SMRT’s core fare-based business suffered an operating loss of SGD32m in 2013 and is expected to remain a key drag to profitability in the future. While a change is imminent, it is highly speculative to conclude that the terms will be favourable to shareholders. In particular, we are concerned over the treatment of the asset purchase obligations under the old rail financing regime (note). In the absence of material announcements, we advise investors to stay cautious. SMRT trades at a rich valuation of 30x FY3/15E P/E. Maintain SELL with TP of SGD0.60.
Starhub – DBSV
Big boost from 4G price hike
- Premium price for 4G service to benefit FY14F/15F earnings by 2%/6%
- Corporate fixed line growth to offset weaker broadband & prepaid mobile
- Upgrade to BUY with revised DCF-based (WACC 6.5%, terminal 0%) TP of S$4.50, implying potential returns of 16%
If 4G prices were to rise to S$10.70, FY15F earnings
could increase by 30%. StarHub will start charging S$2.14 for its 4G service from June 2014 onwards versus its current promotional free offer. The company may further raise the extra charge for 4G to S$10.70 at a later unspecified date. Meanwhile, M1 offers free 4G services till Dec 2014 with regular price for 4G advertised as S$10.70. Elsewhere, SingTel has yet to indicate any intent of following suit. We like to point out that StarHub charges S$8.56 per GB for excess data usage versus S$10.70 by both SingTel & M1. Additionally, StarHub offers extra data-allowance of 1GB than peers on mid- to high-end plans. Even if peers do not follow its premium pricing, we believe StarHub’s 4G plans remain competitive.
StarHub to benefit most from subsidies for SMEs. The government will subsidise SMEs by S$500m over 2014-17 for fibre broadband connections of over 100Mbps. We estimate that Corp. fixed line (~17% of service rev) may grow by single digits to offset the weakness in prepaid mobile (~10% of service rev) and fixed broadband segments (~10% of service rev). Corp fixed line reaps highest EBITDA margins, which we estimate to be 36% versus 20% for pay TV & broadband, and 35% for mobile.
Committed to a fixed 5-Sct DPS each quarter, This translates into a payout ratio of 88%. With FY14F net debtto-EBITDA of 0.5x versus 0.7x for M1 and 0.9x for SingTel, one should expect dividends to rise in FY15F.
Starhub – DBSV
Big boost from 4G price hike
- Premium price for 4G service to benefit FY14F/15F earnings by 2%/6%
- Corporate fixed line growth to offset weaker broadband & prepaid mobile
- Upgrade to BUY with revised DCF-based (WACC 6.5%, terminal 0%) TP of S$4.50, implying potential returns of 16%
If 4G prices were to rise to S$10.70, FY15F earnings
could increase by 30%. StarHub will start charging S$2.14 for its 4G service from June 2014 onwards versus its current promotional free offer. The company may further raise the extra charge for 4G to S$10.70 at a later unspecified date. Meanwhile, M1 offers free 4G services till Dec 2014 with regular price for 4G advertised as S$10.70. Elsewhere, SingTel has yet to indicate any intent of following suit. We like to point out that StarHub charges S$8.56 per GB for excess data usage versus S$10.70 by both SingTel & M1. Additionally, StarHub offers extra data-allowance of 1GB than peers on mid- to high-end plans. Even if peers do not follow its premium pricing, we believe StarHub’s 4G plans remain competitive.
StarHub to benefit most from subsidies for SMEs. The government will subsidise SMEs by S$500m over 2014-17 for fibre broadband connections of over 100Mbps. We estimate that Corp. fixed line (~17% of service rev) may grow by single digits to offset the weakness in prepaid mobile (~10% of service rev) and fixed broadband segments (~10% of service rev). Corp fixed line reaps highest EBITDA margins, which we estimate to be 36% versus 20% for pay TV & broadband, and 35% for mobile.
Committed to a fixed 5-Sct DPS each quarter, This translates into a payout ratio of 88%. With FY14F net debtto-EBITDA of 0.5x versus 0.7x for M1 and 0.9x for SingTel, one should expect dividends to rise in FY15F.