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UOB KAYHIAN |
UOB KAYHIAN |
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Riverstone Holdings (RSTON SP) AI, Forex And Pricing Tailwinds Emerging; 7% Yield Is Attractive
Highlights • A stronger US dollar against the ringgit and improving pricing power from recent ASP hikes by Chinese glovemakers should provide an earnings tailwind. • The cleanroom glove segment, which contributes around 70% of earnings should remain robust, helped by ongoing orders from AI-related data centre and memory storage customers. • Maintain BUY with an unchanged target price of S$1.21. Riverstone currently trades at around 15% discount to peers and offers an attractive 7% 2026 yield.
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Automobile China Auto Sector Weekly (26 Sep-8 Oct 26)
Highlights • We cut our 2026-28 sales estimates for auto OEMs, based on lower-thanexpected 9M26 sales. • 2027 sales are poised for a modest recovery on stabilisation of domestic sales and sustained buoyant export growth. • Trade barriers to China’s EVs are rising globally through tariffs and localisation rules that force Chinese OEMs from exports to local production. This favours the leading OEMs – BYD and Geely. • Maintain MARKET WEIGHT. Top BUYs: BYD, Geely, CATL. Top SELLs: Li Auto, XPeng.
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| LIM & TAN | LIM & TAN |
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Seatrium Limited ($1.96, down 0.05) has secured a Floati ng Storage Regasifi cati on Unit (“FSRU”) conversion contract with an opti on for a second contract from Excelerate Energy, Inc (NYSE:EE) – the global leader in the FSRU industry. Capitalized at S$6.7bln, Seatrium’s forward PE is undemanding at 12.4x, price to book is 0.9x, yield 1.5% while consensus 1 year target price of $2.46 implies a potenti al upside of 26%. Seatrium conti nues to deepen its footprint in the FSRU conversion market, with the project for Excelerate Energy announced just days aft er another project win for Karpowership. Seatrium’s new S$200 million share buyback programme follows the previous S$100 million programme fully uti lized on 1’Sep. Management remains opti misti c about 2H’26 prospects given its robust orderbooks of $13.3bln. We maintain an Accumulate rati ng on Seatrium.
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We highlight the salient points from Tiong Woon Corporation’s / TWC ($0.895, down 1.5 cents) FY2026 Annual Report, where the Group delivered its fi ft h consecuti ve year of revenue and earnings growth, supported by stronger heavy lift ing activity, improving fleet utilisation and operating leverage. Management remains positive on the near to medium-term outlook, underpinned by Singapore’s construction upcycle and growing opportunities in regional infrastructure and industrial developments. TWC’s market cap stands at S$207mln and trades at 8.0x forward P/E and 0.6x P/B, with a dividend yield of 2.8%. Given its exposure to Singapore’s multi -year construction upcycle, ownership of a strategic long-lease building worth at least c.S$100mln, improving financial metrics and increasing contributions from higher-margin overseas projects, we find TWC’s current valuation compelling. We believe the stock deserves to trade closer to its book value of S$1.47 per share (1.0x P/B) as fleet utilisation improves, earnings growth accelerates and the market increasingly recognises the underlying value of its asset base. We thus recommend a BUY on TWC. |
| MAYBANK SECURITIES | |
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Sheng Siong Group (SSG SP) Quality remains but upside narrows; D/G to HOLD
Valuation leaves little room for the next leg Sheng Siong remains a high-quality operator, but its strong share-price rerating now prices in much of it. At 28.4x FY26 P/E & 17.3x EV/EBIT, it is among region’s most expensive food retailers, despite offering a moderate FY25–28 NPAT CAGR of 8% & a 2.5% dividend yield. With growth normalising and slight headwinds emerging, we see limited scope for further re-rating. We have trimmed our 2028 new-store assumption from 5 to 4 and made modest cuts to sales-growth forecasts, reducing FY26–28 NPAT by 1–3%. We downgrade to HOLD & lower our TP to SGD3.12 from SGD3.22. Within the consumer space, we prefer Food Empire (FEH SP), supported by its strong NPAT growth (31% CAGR), moderate valuations and 5% dividend yield.
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