The steep decline in 3M HIBOR could shave off 4-6bp from NIM in 1Q24 as Hong Kong dollar-denominated loans accounted for 11% and 13% of total loans respectively for DBS and OCBC. Singapore banks are expected to deliver steady net profits of S$2,486m for DBS (-3% yoy but +10% qoq) and S$1,824m for OCBC (-3% yoy but +12% qoq) in 1Q24, supported by resilient asset quality. Maintain OVERWEIGHT. Our top picks are DBS (BUY/Target: S$43.25) followed by OCBC (BUY/Target: S$18.15).
KEY HIGHLIGHTS Strategy The Impact Of Escalating Middle East Tensions A fluid situation with oil prices the key worry. Small/Mid Cap Highlights BRC Asia (BRC SP/BUY/S$1.94/Target: S$2.42) 1QFY24: Strong results as construction demand recovers. TRADERS’ CORNER Aztech Global (AZTECH SP): Trading BUY Isdn Holdings (ISDN SP): Trading BUY
OVERWEIGHT on Indonesia banks as they offer the highest earnings growth in 2024/25 and benefit from the recent rally in commodity prices. We like Singapore banks for their attractive dividend yields. Our top BUYs are DBS (Target: S$43.25), CIMB (Target: RM7.33), SCB X (Target: Bt130) and BMRI (Target: Rp7,900). We also like OCBC (Target: S$18.15), RHB (Target: RM6.18) and BBNI (Target: Rp6,300) as attractive yield plays.
We anticipate two rate cuts in 2H24 as opposed to three stipulated by the Fed’s dot plot. Domestic interest rates in Singapore are likely to remain elevated for slightly longer but will start receding in 4Q24, in tandem with rate cuts in the US. Maintain OVERWEIGHT. We raised our 2025 earnings forecasts for DBS by 6% and OCBC by 5%. DBS and OCBC provide 2025 dividend yields of 6.8% and 6.5% respectively. BUY DBS (Target: S$43.25), followed by OCBC (Target: S$18.15).
Our Alpha Picks portfolio rose 6.0% mom on an equal-weighted basis, outperforming the STI by a material 3.4ppt. The outperformance was driven by broad-based strength across most of our portfolio with the best showing coming from Riverstone, Yangzijiang Shipbuilding and Singtel. In 1Q24, our Alpha Picks portfolio surged by 13.7% qoq, surpassing the STI by a hefty 14.2ppt qoq. For Apr 24, we add CSE and LREIT while removing MINT, CVL and FEH.
Riverstone’s 4Q23 earnings rose 60.7% yoy, with 2023 earnings of RM220.4m beating our forecast by 4%. The 2.1% qoq sequential growth of 4Q23 revenue was driven by higher demand for Riverstone’s customised healthcare gloves and a slight recovery in the cleanroom gloves segment. With semiconductor recovery and new clients, we anticipate higher volumes to drive top-line growth. Maintain BUY with a 7% higher target price of S$0.88. We like Riverstone for its attractive 2024 dividend yield of 10%.
Banks delivered resilient earnings in 4Q23 (DBS: -3% yoy, OCBC: +12% yoy) with low single-digit growth in net interest income and benign asset quality. DBS and OCBC have increased their final dividend by 12.5% and 5% respectively to 54 S cents and 42 S cents. DBS has also proposed a 1-for-10 bonus issue. DBS and OCBC provide attractive 2024 dividend yields of 6.5%. BUY DBS (Target: S$40.75), followed by OCBC (Target: S$17.22). Maintain MARKET WEIGHT.
A director at United Overseas Bank Ltd bought 100,000 shares at 28.495SGD and the significance rating of the trade was 67/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two y...
KEY HIGHLIGHTS Results iFAST Corp (IFAST SP/HOLD/S$8.34/Target: S$8.56): 4Q23: Second consecutive record AUA; HK ePension division drives growth. Genting Singapore (GENS SP/BUY/S$1.03/Target: S$1.25): 4Q23: Qoq weaker set of results within our expectations, but 2024 outlook remains appealing. Maintain BUY and target price of S$1.25. United Overseas Bank (UOB SP/NOT RATED/S$28.50): 4Q23: Building regional franchise for consumer businesses. Venture Corporation (VMS SP/BUY/S$14.10/Target: S$16....
UOB reported net profit of S$1,498m for 4Q23 (+7% yoy). Wealth management fees grew 21% yoy due to growth in bancassurance and pick-up in demand for fixed income products. Credit card fees grew 69% yoy due to higher customer spends and expanded regional franchise after consolidating Citi consumer businesses. UOB generated ROE of 13.9% in 2H23 and CET-1 remains robust at 13.4% in 4Q23.
GREATER CHINA Economics Inflation: Jan 24 CPI inflation lower on base effect. Sector Automobile: Weekly: EV market share falls to 38-week low. Top SELLs: BYD, XPeng and Li Auto. MALAYSIA Update Press Metal Aluminium Holdings (PMAH MK/BUY/RM4.62/Target: RM5.50): Anticipate growth to resume in 2024 following peaking interest rate cycle and more robust contribution from VAPs. SINGAPORE Results Singapore Post (SPOST SP/HOLD/S$0.405/Target: S$0.54): 3QFY24 update: Soft quarter, as forex and Famou...
KEY HIGHLIGHTS Results Singapore Post (SPOST SP/HOLD/S$0.405/Target: S$0.54): 3QFY24 update: Soft quarter, as forex and Famous Holdings impact profits. StarHub (STH SP/BUY/S$1.07/Target: S$1.41): 2023: Results slightly above expectations, DARE+ costs to taper off in 2024. TRADERS’ CORNER Delfi (DELFI SP): Trading BUY Wilmar International (WIL SP): Trading SELL
For 2023, StarHub reported higher revenue (+2% yoy) and underlying PATMI (+77% yoy), driven by broad-based growth across all service segments. Overall margins are expected to improve in 2024 on the back of ongoing cost optimisation efforts as well as an expected tapering off in DARE+ investments in 2H24. Armed with a lush 2024 dividend yield of 6.8%, we maintain BUY with a higher target price of S$1.41.
Summary Marketline's Oversea-Chinese Banking Corporation Limited Mergers & Acquisitions (M&A), Partnerships & Alliances and Investments report includes business description, detailed reports on mergers and acquisitions (M&A), divestments, capital raisings, venture capital investments, ownership and partnership transactions undertaken by Oversea-Chinese Banking Corporation Limited - Mergers & Acquisitions (M&A), Partnerships & Alliances since January2007. Marketline's Company Mergers & Acquisit...
Riverstone’s cleanroom gloves, which contribute about 80% of earnings, are expected to see a recovery in demand, driven by new clients onboarded in the preceding year and improvement in the semiconductor industry in 2024. On the healthcare gloves front, sustained product customisation efforts with new production lines are yielding results, as seen from increased demand for higher-margin customised healthcare gloves. We upgrade Riverstone to BUY with a 22% higher target price of S$0.82.
REGIONAL Sector Banks: ASEAN Banks: quarterly update. Plantation: Maintain 2024 CPO ASP at RM4,200/tonne, with pricing expected to be higher in 1H24. Accumulate Malaysia upstream players and companies with better-than-peers production growth. GREATER CHINA Economics Inflation: Dec 23 CPI inflation beat expectations but deflationary pressure remains. Money Supply: Dec 23 M2 and credit growth slowed, expect further monetary easing. Trade: Dec 23 trade numbers beat expectations; auto exports conti...
KEY HIGHLIGHTS Sector ASEAN Banks: ASEAN Banks: quarterly update. Regional Plantation: Maintain 2024 CPO ASP at RM4,200/tonne, with pricing expected to be higher in 1H24. Accumulate Malaysia upstream players and companies with better-than-peers production growth. TRADERS’ CORNER Sembcorp Industries (SCI SP): Trading BUY Top Glove Corp (TOPG SP): Trading BUY
Interest rates have peaked and entered a downcycle. Indonesian banks are the biggest beneficiaries of lower interest rates and have the highest earnings growth in 2024 and 2025. Our top BUYs are OCBC (Target: S$16.85), CIMB (Target: RM6.65), SCB X (Target: Bt124) and BBNI (Target: Rp6,300). Yield plays, such as DBS (Target: S$41.65), RHB (Target: RM6.35), KTB (Target: Bt21.50) and BMRI (Target: Rp6,500), are attractive in an environment of lower bond yields.
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