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UOB KAYHIAN |
UOB KAYHIAN |
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Strategy Alpha Picks: Large-cap Strength, SMID-cap Weakness
Highlights • Our Jun 26 Alpha Picks slightly lagged the FSSTI by 1.1ppt on a market capweighted basis, with gains led by a narrow large-cap leadership. • For Jul 26: Add UIBREIT; no removals. • Jun 26 Alpha Picks: BKM, CAO, CIT, FEH, HLA, HUAGL, KEP, NTTDCR, OCBC, OTEK, RSTON, UGAI, UIBREIT, VALUE and VMS.
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Strategy Alpha Picks: A Barbell Approach ‒ Balancing Defensive Resilience With Tactical Opportunities
Highlights • Our Jun 26 Alpha Picks outperformed the FBMKLCI (+1.8% vs FBMKLCI: - 1.1%). Petronas Dagangan (+6.5%), Solarvest (+4.9%) and Northeast (+4.5%) led the charge while losers included Oxford (-4.1%) and Yinson (- 4.0%).
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| LIM & TAN | LIM & TAN |
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GuocoLand Limited ($2.14, up 0.01) has secured a S$634.7 million green club facility (“green facility”) from Oversea-Chinese Banking Corporati on Limited and Industrial and Commercial Bank of China Limited Singapore Branch to fi nance the development of its Lentor Central site, which was awarded on 6 March 2026. Raised under GuocoLand’s Green Finance Framework, the latest green facility for the future residenti al development at the Lentor Central site expands GuocoLand’s portfolio of green a facilities for its residential properties, including Springleaf Residence, Faber Residence and River Modern; as well as for the commercial components of its integrated mixed developments, Guoco Tower and Guoco Midtown. We continue to like the solid and robust track record of Guocoland’s development projects in the lentor area which will likely be another “sell-out”. At 0.6X price to book, 3-4% dividend yield and 50% upside to consensus target price of $3.30, we maintain an “Accumulate” rating on Guocoland.
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SGX ($24.11, up 2 cents) announced enhancements to market structure and mechanics proposed by Singapore Exchange Regulati on (SGX RegCo) earlier this year will be implemented in stages starti ng this month. These proposals received broad support from market participants during the public consultati ons. SGX market cap stands at S$25.7bln and currently trades at 36x forward PE and 11.3x PB, with a dividend yield of 2%. Consensus target price stands at S22.34, representing 7% upside from current share price. This announcement is likely to boost the trading of liquidity of most large caps that has share prices of above $10 as it will improve trading liquidity and give access to retailers. Although steps are taken to boost the SG market such as EQDP funding and reduction of standard board lot size, we think SGX has run it’s course and valuati ons now remain loft y. As such, we have a HOLD recommendation on SGX. |
| CGS INTERNATIONAL | OCBC GROUP RESEARCH |
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Frasers Centrepoint Trust White Sands exit: what comes next?
■ FCT plans to divest White Sands at an 8.4% premium over valuation. ■ Near-term DPU impact is modestly dilutive but the divestment strengthens FCT’s balance sheet through debt repayment. ■ We think the White Sands divestment reflects FPL’s value-unlocking strategy, alongside its ongoing consolidation of landholdings around The Centrepoint. ■ Maintain Add, with an unchanged DDM-based TP of S$2.86.
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Equity strategy: Constructive on 2H26 outlook Summary Points
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