Reuters: Hot Stocks: STOCKS NEWS SINGAPORE-Nomura favours conglomerates, banks

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STOCKS NEWS SINGAPORE-Nomura favours conglomerates, banks Jul 6th 2012, 03:36 Thu Jul 5, 2012 11:36pm EDT Despite potentially slower growth for Singapore, Nomura said it is bullish on the city-state's conglomerates and banks for their strong financial positions, but remains bearish on transport and gaming companies. Singapore banks are benefitting from the withdrawal of foreign competition in the region, Nomura said, adding that they look attractive at price-to-book of 1-1.2 times, with strong capital, resilient loan growth and improving margins. Nomura expects Southeast Asia's largest lender DBS Group and United Overseas Bank (UOB) to continue outperforming in the second half, and has a 'buy' rating for both with a target price of S$18.30 and S$22.60 respectively. DBS shares were down 0.5 percent at S$13.94, but have surged 21 percent so far this year, while UOB was down 1.3 percent at S$19.13, rising 25 percent since the start 2012. "We believe Singapore conglomerates are well positioned to ride through this period of consolidation given their strong financial positions," Nomura said. Its picks include property and rigbuilder Keppel Corp , Fraser & Neave and Sembcorp Industries , whose strong balance sheets will give it opportunities to make acquisitions. However, Nomura expects container shipping firm Neptune Orient Lines (NOL) to report losses that are larger than consensus estimates, and said it was too early to turn positive on the shipping sector, with container earnings peaking and drybulk rates remaining depressed. It has a 'reduce' rating and a target price of S$1.20 for NOL, which it said it was currently reviewing. 1124 (0324 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ 11:11 STOCKS NEWS SINGAPORE-Maybank upgrades K-REIT to hold Maybank Kim Eng upgraded K-REIT Asia, which owns commercial buildings, to 'hold' from 'sell' and raised its target price to S$0.99 from S$0.83, citing steps the trust took to improve unitholders' returns. By 0257 GMT, units of K-REIT were flat at S$1.075, and have gained about 29.6 percent since the start of the year, compared to the FT ST Real Estate Investment Trust's 18 percent rise. Maybank said a move by K-REIT to convert a vehicle to limited liability partnership from private limited company will result in greater tax transparency and estimated annual tax savings of S$2.2 million to S$5.2 million for 2012-2015, leading to higher distributions to unitholders. K-REIT also acquired additional 12.4 percent stake in Ocean Properties, bringing its interest to 99.9 percent. As a result, Maybank has raised its distribution per unit estimates for K-REIT by 6-12 percent for 2012-2014. For related story click 1034 (0257 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ 10:43 STOCKS NEWS SINGAPORE-Aussino up after picking financial advisor Shares of bed linen maker Aussino Group Ltd rose as much as 12 percent to a one-week high after it said it had appointed Primepartners to be its financial advisor for a proposed reverse takeover by a Myanmar-based group. By 0232 GMT, Aussino shares were up 7.5 percent to S$0.144 and have surged 289 percent since the start of the year. Aussino shares have fallen nearly 16 percent since it emerged in late June that the reverse takeover may not go through as the firm planning to inject assets into Aussino, Max Strategic Investments, is linked to a Myanmar businessman on a U.S. blacklist. Aussino also said in a statement it was working towards executing a definitive legally-binding sale and purchase agreement before August 14. For related stories, click 1034 (0234 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) ************************************************************ 9:55 STOCKS NEWS SINGAPORE-OCBC upgrades Dyna-Mac to buy OCBC Investment Research upgraded oil and gas services firm Dyna-Mac Holding Ltd to buy from hold and raised its target price to S$0.45 from S$0.34, citing an increase in production capacity and growth in its non-module business. By 0142 GMT, shares of Dyna-Mac were 1.3 percent higher at S$0.405, but have fallen about 4.7 percent since the start of the year, compared to the FT ST Oil and Gas Index's 21.9 percent gain. Dyna-Mac plans to buy 70 percent stake in Paliy Marine Fabricator (Guangzhou) Ltd for S$3.8 million, which could potentially increase Dyna-Mac's maximum output by 70 percent, said OCBC. "Dyna-Mac is confident of getting sufficient new orders to fill the newly acquired yard, by leveraging on its good track record and close working relationships with its global clients," said OCBC. The brokerage said it expects Dyna-Mac to ramp up operations at its new yard over the next 12 months. It is also expanding other businesses, taking on other jobs such as turrets and land-based modules, which will help it to diversify its product offerings and lower risk, OCBC said. For related statement, click 0942 (0142 GMT) (Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com) Link this Share this Digg this Email Reprints

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