Suntech SA

  • TickerSUN
  • ISINPLSNTCH00012
  • ExchangeWarsaw Stock Exchange
  • SectorSoftware & Computer Services
  • CountryPoland

Analysts

UOB
Chaiwat Arsirawichai ...
  • Johnny Yum Chung Man
  • Jonathan Koh
  • Keith Wee Teck Keong
  • Ken Lee
  • Loke Pei Hao
  • Lucas Teng Yao Yang
  • Raphon Prima
  • Tanaporn Visaruthaphong

Regional Morning Notes - Wednesday, July 10, 2019

CHINA Sector Automobile: PV retail sales growth returns to positive territory in June. INDONESIA Update Bank Rakyat Indonesia (BBRI IJ/BUY/ Rp4,410/Target: Rp4,900): Potential 20% net income growth in 2020 has not been priced in; upgrade to BUY. MALAYSIA Update Hong Leong Bank (HLBK MK/HOLD/RM19.00/Target: RM20.45): Moderating revenue trends and relatively rich valuations at 1.48x FY20F P/B against ROE of 10.4% (sector P/B: 1.18x, ROE: 10.2%) prompt us to maintain HOLD. SINGAPORE Update ComfortDelGro Corporation (CD SP/BUY/S$2.84/Target: S$3.08): Positives from regulatory changes. Suntec ...

UOB
Jonathan Koh ...
  • Loke Pei Hao

Suntec REIT - Continued expansion in Australia

The proposed acquisition of 21 Harris Street in Sydney, Australia will deepen SUN’s Australia exposure from 11% to 14% of its total AUM. The acquisition is expected to be DPU-accretive (boosting pro-forma FY18 DPU by 0.5%). The transacted price is fair and in line with the independent valuation by JLL. Maintain HOLD with a higher target price of S$2.00 (previously S$1.99). Entry price: S$1.82.

UOB
Jonathan Koh ...
  • Loke Pei Hao
  • Lucas Teng Yao Yang

Singapore Daily - Wednesday, July 10, 2019

KEY HIGHLIGHTS Update ComfortDelGro Corporation (CD SP/BUY/S$2.84/Target: S$3.08): Positives from regulatory changes. Suntec REIT (SUN SP/HOLD/S$1.95/Target: S$2.00): Continued expansion In Australia.

UOB
Jonathan Koh ...
  • Loke Pei Hao

REITs - Potential cut in interest rates if trade conflict escalates

The FED will closely monitor the implications of trade negotiations and will act appropriately to sustain economic expansion. Yield for 10Y government bonds receded by 56bp to 2.12% in the US but remained unchanged at 2.04% in Singapore during 1H19. Our sensitivity analysis indicates that target prices of S-REITs will rise 5.1% for a 25bp drop in RFR. Maintain OVERWEIGHT.

UOB
Jonathan Koh ...
  • Loke Pei Hao

Office REITs - Tight vacancies pushing office rents higher

The office market bottomed in 1H17 and has progressed to the second year of recovery. Continued upside for office rents is supported by tapering of supply. Supply has eased to 1.3m sf this year, of which only 228,958sf is within the core CBD. Net absorption of office space remains positive and is driven by modern services, technology companies, including start-ups and fintechs, and co-working operators. Maintain OVERWEIGHT. Our top-pick is CCT, followed by KREIT.

UOB
Chaiwat Arsirawichai ...
  • Johnny Yum Chung Man
  • Jonathan Koh
  • Keith Wee Teck Keong
  • Ken Lee
  • Loke Pei Hao
  • Lucas Teng Yao Yang
  • Raphon Prima
  • Tanaporn Visaruthaphong

Regional Morning Notes - Wednesday, July 10, 2019

CHINA Sector Automobile: PV retail sales growth returns to positive territory in June. INDONESIA Update Bank Rakyat Indonesia (BBRI IJ/BUY/ Rp4,410/Target: Rp4,900): Potential 20% net income growth in 2020 has not been priced in; upgrade to BUY. MALAYSIA Update Hong Leong Bank (HLBK MK/HOLD/RM19.00/Target: RM20.45): Moderating revenue trends and relatively rich valuations at 1.48x FY20F P/B against ROE of 10.4% (sector P/B: 1.18x, ROE: 10.2%) prompt us to maintain HOLD. SINGAPORE Update ComfortDelGro Corporation (CD SP/BUY/S$2.84/Target: S$3.08): Positives from regulatory changes. Suntec ...

UOB
Jonathan Koh ...
  • Loke Pei Hao

Suntec REIT - Continued expansion in Australia

The proposed acquisition of 21 Harris Street in Sydney, Australia will deepen SUN’s Australia exposure from 11% to 14% of its total AUM. The acquisition is expected to be DPU-accretive (boosting pro-forma FY18 DPU by 0.5%). The transacted price is fair and in line with the independent valuation by JLL. Maintain HOLD with a higher target price of S$2.00 (previously S$1.99). Entry price: S$1.82.

UOB
Jonathan Koh ...
  • Loke Pei Hao
  • Lucas Teng Yao Yang

Singapore Daily - Wednesday, July 10, 2019

KEY HIGHLIGHTS Update ComfortDelGro Corporation (CD SP/BUY/S$2.84/Target: S$3.08): Positives from regulatory changes. Suntec REIT (SUN SP/HOLD/S$1.95/Target: S$2.00): Continued expansion In Australia.

UOB
Jonathan Koh ...
  • Loke Pei Hao

Singapore Daily - Thursday, May 30, 2019

KEY HIGHLIGHTS Sector Office REITs: Tight vacancies pushing office rents higher. TRADERS’ CORNER Comfortdelgro Corp (CD SP): Trading Buy Wilmar International (WIL SP): Trading Buy

UOB
Abdul Hadi Bin Abdul Manaf ...
  • Johnny Yum
  • Jonathan Koh
  • Keith Wee Teck Keong
  • Ken Lee
  • Loke Pei Hao
  • Raphon Prima
  • Tham Mun Hon
  • Thunya Sutavepramochanon

Regional Morning Notes - Thursday, January 24, 2019

CHINA Strategy Watch The Credit Cycle: Slowing liquidity growth is a key factor causing the macro slowdown. Unless monetary easing is stepped up, the ytd rally is unlikely to be sustainable. Sector Paper: Paper prices rebounding due to inventory restocking. Maintain MARKET WEIGHT. INDONESIA Results Bank Negara Indonesia (BBNI IJ/BUY/Rp9,050/Target: Rp10,500): 2018: In-line results; still expect 17% earnings growth in 2019. MALAYSIA Update CIMB Group (CIMB MK/BUY/RM5.66/Target: RM7.00): We expect improved NIMs, stable asset quality and a commendable loan growth outlook to fuel a recovery in sh...

UOB
Jonathan Koh ...
  • Loke Pei Hao

REITs - Potential cut in interest rates if trade conflict escalates

The FED will closely monitor the implications of trade negotiations and will act appropriately to sustain economic expansion. Yield for 10Y government bonds receded by 56bp to 2.12% in the US but remained unchanged at 2.04% in Singapore during 1H19. Our sensitivity analysis indicates that target prices of S-REITs will rise 5.1% for a 25bp drop in RFR. Maintain OVERWEIGHT.

UOB
Jonathan Koh ...
  • Loke Pei Hao

Office REITs - Tight vacancies pushing office rents higher

The office market bottomed in 1H17 and has progressed to the second year of recovery. Continued upside for office rents is supported by tapering of supply. Supply has eased to 1.3m sf this year, of which only 228,958sf is within the core CBD. Net absorption of office space remains positive and is driven by modern services, technology companies, including start-ups and fintechs, and co-working operators. Maintain OVERWEIGHT. Our top-pick is CCT, followed by KREIT.

UOB
Jonathan Koh ...
  • Loke Pei Hao

REITs - 4QFY19: MLT (above expectations); steady delivery

MLT’s 4QFY19 results beat expectations. Overall portfolio saw rental reversion of +2% in FY19, while occupancy remained high at 98%. Management flagged interest in acquiring sponsor’s China properties (completing in the next 12-18 months). Despite CWT International’s default in Hong Kong, MLT appears to be insulated with 6-month security deposits and “sticky” underlying tenants. Maintain HOLD. Target price: S$1.39. Entry price: S$1.26. Maintain OVERWEIGHT on the sector.

UOB
Jonathan Koh ...
  • Loke Pei Hao

REITs - 1Q19: CMT (In-line) and SUN (In-line); 2QFY19: FCT (In-line)

CMT’s 1Q19 results were driven by the newly-acquired 70% interest in Westgate (completed on 1 Nov 18) as well as increased contributions from Bedok Mall and Tampines Mall. Maintain HOLD on CMT with a target price of S$2.02. SUN achieved 100% pre-commitment for 9 Penang Road, and continues to see stellar occupancies at ORQ and MBFC. Maintain HOLD on SUN with lower target price: S$1.99. FCT saw stable occupancies at 96.0%, and broad-based improvements led by Changi City Point. Downgrade to HOLD with target price of S$2.32. Maintain OVERWEIGHT on the sector.

UOB
Jonathan Koh ...
  • Loke Pei Hao

REIT - 4Q18: CMT (above), 4Q18: SUN (in line), 3QFY19: MINT (in line)

CMT benefitted from the acquisition of remaining 70% stake in Westgate, which turned around to positive rental reversion in 4Q18. NPI from SUN’s Suntec City Mall increased 6.5% yoy (up 16.3% yoy excluding contribution to sinking fund) after completion of asset enhancement. MINT’s strategy of growing Hi-Tech Buildings segment yielded positive results with DPU increasing 6.6% yoy. Maintain HOLD for CMT (entry price: S$1.84), SUN (entry price: S$1.83) and MINT (entry price: S$1.78). Maintain OVERWEIGHT on the REIT sector.

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