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PHILLIP SECURITIES |
UOB KAYHIAN |
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DBS Group Holdings Ltd Capital returns begin
▪ 4Q24 adjusted PATMI of S$2.6bn was in line with our estimates, FY24 adjusted PATMI is 100% of our FY24e forecast. 4Q24 DPS rose 22% YoY to 60 cents and full-year FY24 DPS at S$2.22 (+27% YoY). An additional capital return dividend of 15 cents/quarter is to be given in 2025. We expect the return to sustain over the next 3 years.
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NetLink NBN Trust (NETLINK SP) 3QFY25: Soft Results On Lower Prices And Higher Operating Costs
Netlink posted lower 3QFY25 revenue (-0.8% yoy), EBITDA (-7.6% yoy) and PATMI (- 20.4% yoy), in line with our expectations. The soft performance was largely due to lower interconnection prices and higher operating costs. Despite lower prices, 9MFY25 RAB revenue was stable as overall connections continued to grow. With its stable revenue streams and operating cash flows, we continue to like Netlink as a high-yielding, safehaven stock. Maintain BUY with the same target price of S$0.98.
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UOB KAYHIAN |
MAYBANK KIM ENG |
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Mapletree Industrial Trust (MINT SP) Weathering The Bumpy Ride
The leases for three data centres at 2000 Kubach Road in Philadelphia, 400 Holger Way in San Jose and 250 William Street in Atlanta are unlikely to be renewed. Our worst-case scenario with the data centres staying vacant provides FY26 DPU of 13.2 S cents and target price of S$2.65. There would be downtime whether the data centres are re-leased or deployed for alternative usage. MINT provides an FY26 distribution yield of 6.5% (DCREIT: 7.0% and KDCREIT: 4.9%). Maintain BUY. Target price: S$2.70.
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ISOTeam (ISO SP) Election play: Drone painting game-changer
Initiate with a BUY and a TP of SGD0.09 ISOTeam, a major local painter (30% market share) for government housing projects (HDB), bounced back to profitability in FY24 as older projects with lower margins have all been executed. We believe FY25E will be an inflection point for its profitability and the launch of its AI drone-painting solution on an HDB site in Apr’25 and will be rolled out at more estates if successful. This should enable it to leapfrog competitors with 30-40% lower costs, aligning with the government’s push to reduce manpower. We expect high growth ahead and initiate coverage with BUY and a TP of SGD0.09, based on a blended 8x FY25/26E P/E.
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| MAYBANK KIM ENG | OCBC |
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Netlink NBN Trust (NETLINK SP) 9MFY25: Stability resurfacing
9MFY25 review: Earnings up 12% QoQ 3QFY25 earnings increased 12% QoQ but still declined 20% YoY. Revenues declined 1% YoY/QoQ. Given 3Q is a trading update few details were published. However, we do note that reduction in its regulated pricing from Apr’24 weighed slightly on YoY revenue momentum. EBITDA grew 5% QoQ but still declined 8% YoY. 9MFY25 revenues/EBITDA are trending at 74- 75% of MIBG/street estimates while earnings are trending at 69%. Retain BUY with TP or SGD0.97.
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Suntec REIT (SUN SP) – HOLD
Suntec REIT’s Singapore operations continue to perform well, with strong rental reversions in both retail and office segments, alongside a faster-than-expected recovery in its convention business. However, rental growth for Singapore office assets may moderate, with uncertainties over long-term work-from-home trends. Overseas, its Australia and UK office portfolios have been impacted by asset impairments due to rising capitalisation rates and soft occupancy. Additional risks include currency fluctuations, high leverage, low interest coverage ratio, and slower-than-expected asset divestments. Given these challenges, we maintain a HOLD rating. |
