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CGS INTERNATIONAL |
CGS INTERNATIONAL |
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OCBC 1Q26 insurance tailwinds to hold in 2Q26F
■ We expect OCBC to announce 2Q26F net profit of S$1.93bn (+6.4% yoy, - 2.1% qoq), supported by continued growth in non-II. ■ Consequently, we raise our EPS by 2.1% across FY26F-28F, driven by synergies between its wealth management and insurance franchise. ■ However, we downgrade to Hold following a c.19.1% rise in share price since Jun, with a higher GGM-based TP of S$28.40 (LTG: 2.0%, ROE: 13.5%).
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DBS Group Attractive yield lasting till FY27F
■ We expect DBS to report 2Q26F net profit of S$2.90bn (+2.7% yoy, -1.0% qoq), supported by elevated wealth management fees and other non-II. ■ The pause in DBS’s S$3bn share buyback programme by FY27F supports an attractive FY27F yield of 4.8% with potential for special DPS, we believe. ■ We raise our FY26F/27F/28F EPS by 2.4%/3.6%/3.8% on stronger non-II growth and reiterate Add with a higher GGM-based TP of S$77.10.
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| UOB KAYHIAN | LIM & TAN |
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Oiltek International (OTEK SP) Strong Growth Pipeline; Project Execution Remains In Focus
Highlights • We hosted Oiltek recently, and management provided updates on its operations and expansion strategy. • Oiltek continues to pursue growth through a strong pipeline of SAF projects, JVs and new ventures. In addition, the HOA announced in Apr 26 is progressing well. • Maintain BUY with an unchanged target price of S$2.78, pegged to 28x 2027F PE. We believe contract wins and delivery of better earnings could continue to support its re-rating potential.
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Mainboard-listed Metro Holdings Limited (S$0.46, up 0.5 cts) has announced plans to repositi on its retail business as part of a long-term strategy to bett er meet evolving consumer preferences and strengthen the positi oning of its retail business in Singapore. At 46 cents, Metro Holdings is capitalized at $382mln and trades at 4.4% dividend yield. The company is currently loss-making. Based on its latest NAV of $1.12/share, price to book is low at 0.4x. Bloomberg consensus target price of S$0.70 represents a 52.2% potenti al upside. We will be monitoring closely any new developments of the company before making a more concrete recommendati on. |
| LIM & TAN | MAYBANK SECURITIES |
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Frasers Centrepoint Trust / FCT ($2.27, up 1 cent) has successfully secured, through a consorti um, the tender for a prime mixed-use site at Bayshore Drive with a winning bid of S$2.1 billion, equivalent to S$1,323 per square foot per plot rati o. Under the joint venture structure, the residenti al component will be developed for sale, while the commercial component, comprising a suburban retail mall, will be developed and retained by the retail consorti um in which FCT holds a 50% stake. FCT’s market cap stands at $4.6blnh and currently trades at 18.5x forward PE and 1x PB, with a dividend yield of 5.4%. Consensus target price stands at S$2.60, representi ng 14.5% upside from current share price. FCT conti nues to be boosted by their latest acquisiti ons and will benefi t from future AEIs. Given it’s currently strong yield and fundamentals, we conti nue to have an Accumulate on weakness recommendati on on FCT, backed by decreasing rate cuts moving forward.
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Grab Holdings (GRAB US) Uber-Delivery Hero: a new overhang for Grab
Uber's return to ASEAN could reshape competition Uber's proposed USD15b acquisition of Delivery Hero could mark its return to ASEAN 8 years after its exit from the region. While regulatory approval is one hurdle, we believe the bigger question is whether Uber intends to rebuild a long-term operating presence in ASEAN. Several aspects of the transaction suggest that it does. Most notably, despite the existing noncompete agreement with Grab, Uber excluded Foodpanda's ASEAN operations from the SSW Partners divestment, even though the business is worth just c. USD1b within a USD15b transaction. In our view, this suggests Uber deliberately preserved its strategic optionality, making the acquisition more than just a food delivery deal — it could ultimately reshape competition across ASEAN's on-demand services landscape.
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