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CGS INTERNATIONAL |
UOB KAYHIAN |
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Nanofilm Technologies Int'l Ltd Revenue recovery continues
■ Nanofilm’s revenue grew 20% yoy to S$72m in 3Q25. 9M25 revenue rose 26% yoy to S$179m, in line at 78% of our FY25F revenue forecast. ■ AMBU remained the group’s largest revenue contributor (87.5% of 3Q25 revenue). Within AMBU, 3C revenue rose 30% yoy to S$48m. ■ Reiterate Reduce call given the slow pace of earnings recovery due to the uncertain demand outlook and the typically slower fourth quarter.
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Strategy Alpha Picks: Maintaining The Outperformance
Highlights • Our Oct 25 Alpha Picks outperformed, up 8.5% vs the STI’s 3.0%. • For Nov 25: long CIT and ASL, short SIA; remove HLA and SCI. • Nov 25 Alpha Picks: ASL, CIT, CLAR, CSSC, CSE, DFI, FEH, FRKN, LREIT, MPM, OCBC, RSTON, SIA, UMSH and VALUE.
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UOB KAYHIAN |
UOB KAYHIAN |
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REITs The Race To Dominate Through Enlarged Scale
Highlights • The merger of CapitaLand and Mapletree is a matter of time given the emphasis to create global giants within Temasek. • MINT (HOLD/Target: S$1.22), MLT (HOLD/Target: S$1.38) and MPACT (BUY/Target: S$1.84) are potential takeover targets. KREIT (BUY/Target: S$1.20) and SUN (HOLD/Target: S$1.42) are potential new entrants to be included as constituents of the STI. • Maintain OVERWEIGHT.
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ASL Marine (ASL SP) Deeply Undervalued As Turnaround Gains Momentum
Highlights • ASL is a leading Singapore-based integrated marine services group with over 40 years of operations across shiprepair, shipbuilding, and shipchartering. • Earnings recovery and deleveraging are on track with structural tailwinds. • Initiate coverage with BUY and a target price of S$0.33. ASL trades at 7.7x FY26F PE, a deep 45% discount to Singapore-listed peers’ average of 13.8x.
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| OCBC INVESTMENT RESEARCH | OCBC INVESTMENT RESEARCH |
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First REIT – HOLD | Fair Value: SGD 0.265 (from 0.27)
First REIT’s 3Q25 DPU fell 5.5% QoQ and 10.3% YoY to 0.52 Singapore cents, missing expectations due to continued FX headwinds from a stronger SGD and weaker IDR/JPY. For 9M25, rental income and NPI slipped modestly to SGD 75.5m and SGD 73.3m, while distributable income dropped 6.1% YoY to SGD 34.8m. The REIT’s gearing rose slightly to 41.4%, though the all-in cost of debt improved to 4.6% following refinancing efforts. Management continues its strategic review after receiving a non-binding LOI from PT Siloam International Hospitals to acquire its Indonesian assets. The divestment of Imperial Aryaduta Hotel & Country Club will unlock SGD 25.5m in proceeds, likely used for debt repayment or capital recycling. OCBC has cut FY25–26 DPU forecasts by 4.5–6.3% and lowered its fair value estimate to SGD 0.265, maintaining a HOLD rating given ongoing currency pressures and moderate near-term growth. Key catalysts include DPU-accretive acquisitions, successful asset recycling, and improved lease terms, while main risks are FX volatility, tenant default, and execution of its 2.0 Growth Strategy.
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China Aviation Oil (CAO) – HOLD | Fair Value: SGD 1.60 (from 1.50)
OCBC raised CAO’s fair value to SGD 1.60 on an improved earnings outlook but downgraded the stock to HOLD after a strong 68% year-to-date rally, which leaves limited upside. CAO remains the largest physical jet fuel trader in Asia-Pacific and a key beneficiary of China’s aviation recovery. Despite slow outbound travel, OCBC expects long-term growth in jet fuel demand supported by rising air traffic and affluence in the region. FY25–26 earnings are projected to grow steadily, with PATMI rising from USD 78.1m in FY24 to USD 95.0m in FY26, backed by a solid net cash position of USD 515m and healthy margins (~0.5%). A pending restructuring of parent company China National Aviation Fuel Group (CNAF) introduces near-term uncertainty, as CAO depends on CNAF for its import licence that underpins its near-monopoly in China’s jet fuel import market. Key catalysts include stronger Chinese air travel recovery, accretive acquisitions, and higher shareholder payouts under Singapore’s Equity Market Development Program. |
