SINGAPORE - Stay up to date on market chatter with our picks of the latest broker research reports, compiled by The Straits Times Money Desk.
1. Sheng Siong Group
The second quarter is a steady quarter and the counter looks attractive after the selldown that followed a share placement.
Sheng Siong's core net profit for the first nine months was in line with our expectation and formed 76 per cent of our full-year estimate.
The third quarter core net profit was also in line with expectations as gross margins normalised to an expected 24.2 per cent from a surprisingly high figure of 24.7 per cent.
We maintain our forecasts for the 2014 to 2016 financial years.
Maintain ADD with target price of 77 cents
2. Yoma Strategic Holdings
Yoma reported second quarter net profit $10.8 million, an increase of 222 per cent mostly owing to fair value gains of $8.1 million recognised from completed units in Star City and $1.9 million from a foreign exchange gain in US dollar monetary assets.
Overall, these figures are mostly in line with our expectations.
After netting out the FX gain, the first half results constitute 57 per cent of our full year forecast. Second quarter revenue increased 52.9 per centto $41.2 million as the group recognised higher sales from property developments and land rights from Star City.
Sales at Star City remain firm. As at Sept 30, 528 units have been sold in Zone A.
The group has also sold 856 units and received booking deposits for an additional 106 units out of 1,043 units at Star City Zone B since its launch in April 2013.
Maintain BUY with fair value estimate under review.
Osim's third quarter results were a big miss, as earnings fell 27.8 per cent to $16.4 million, partly dragged down by legal costs.
Its net profit for the first nine months now makes up 63 per cent of consensus net profit for the 2014 financial yeart and it is not likely to achieve earlier forecasts.
Overall sales were weak. Osim's third quarter revenue rose 3 per cent $158.2 million, but this was due to the consolidation of TWG.
We estimate revenue of its other businesses were down by around 5 to 10 per cent with the decline being broad-based in nature.
Discretionary retailers are experiencing weak demand in key markets like mainland China, Hong Kong, Singapore and Malaysia.
The lack of any new products that are major hits in recent quarters was also a factor, in our view.
We believe the business remains fundamentally sound, but note the weak operating environment.
Maintain BUY with lower target price of $2.75, down from $3.85.