*Maybank Kim Eng Kopi-O (29 Oct 2021)*
Nikkei 28820.1 -0.96%
Kospi 3009.6 -0.53%
SSE 3518.4 -1.23%
HSI 25555.7 -0.28%
TWSE 17041.6 -0.19%
SET 1624.3 -0.20%
JCI 6524.1 -1.18%
STI 3203.8 -0.45%
KLCI 1566.9 -1.02%
*MKE Key Calls*
*Mapletree Commercial Trust - Placed For Recovery*
CT’s revenue/NPI rose 1.1% YoY/0.4% YoY in 2Q22, but was lower at 3.7% QoQ/4.1% QoQ. The results were in line to consensus’ and our estimates, and with 1H22 revenue/NPI/DPU at 47% of our FY22E, we have kept our forecasts unchanged. We see a stronger 2H22, underpinned by rising office demand, and improvement in VivoCity’s operating metrics alongside a gradual reopening. Valuations are undemanding at 4.5% div yield, with better DPU visibility from its MBC assets, and added traction from VivoCity’s recovery into the coming quarters. We maintain our forecasts and SGD2.35 DDM-based TP (COE: 5.9%, 2.0%).
*MY*
o The stronger overnight US markets may lend support to the KLCI but trading could be volatile ahead of the weekend break. Sentiment will also stay cautious ahead of the upcoming Budget 2022 (to be tabled today). Technically, we expect the benchmark index to range between 1,570 and 1,590, with supports at 1,577 and 1,555.
o *British American Tobacco (ROTH MK)*: BAT’s 3Q21 results were above our/consensus expectations on lower-thanexpected operating expenses. We expect stronger sequential earnings as easing movement restrictions drive sales volume growth in the near-term. Our FY21-FY23 earnings estimates are raised by 4%-12%. We U/G BAT to BUY with a higher DCF-TP of MYR15.20 (WACC: 9.5%, LT growth: 2.5%).
o *Berjaya Sports Toto (BST MK)*: As we suspected earlier (link), Sports Toto Malaysia (STM) NFO sales are recovering quickly. Barring any unforeseen circumstances, BST should resume paying dividends in 2QFY6/22. Its British luxury car dealer, H.R. Owen is also doing well post-reopening. Our earnings estimates, BUY call and MYR2.41 DCF-based TP are unchanged. We continue to like BST for its high dividend yields (>7% p.a. if STM NFO sales recover to 100% of preCOVID-19 levels) and as a laggard recovery play. Maintain BUY call and MYR2.41 DCF-based TP.
o *Icon Offshore (ICON MK)*: 9M21 results were in line with our expectations, on the back of stronger QoQ performance, driven by its drilling ops. Our estimates are unchanged. The company is on track to meet our expectation amid a sequentially softer 4Q21, as seasonal weakness kicks in. Our SOP-based TP (unchanged) equates to 1x PBV, valuing the: (i) JU ops at 0.6x EV/ replacement value (9 sen/shr) and (ii) OSV ops at 0.7x PBV, (7 sen/shr). Maintain BUY and MYR0.16 TP.
For more stock ideas and market flows, access Market Insight on Maybank Trade on Apple Store and Google Play now.
Stay Ahead, Trade Smart.