Money Talk: CapitaMall Trust, Sembcorp Marine, Nam Cheong

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. CapitaMall Trust

Broker: OCBC

CapitaMall Trust reported results for the third quarter of its 2014 financial year which were in-line with ours and the street's expectations. Gross revenue increased 2.9 per cent year-on-year (YoY) to $164.6 million, while distributuion per unit grew at a stronger 6.2 per cent to 2.72 cents. We expect $11.2 million, or 0.32 cents/unit of taxable income retained in 1H14 to be distributed in 4Q14.

Despite softness in its shopper traffic and tenants' sales psf, we note that the magnitude of decline has moderated, while the portfolio occupancy rate was stable at 98.5 per cent. Positive rental reversions of 6.3 per cent were also achieved for 9M14.

Maintain BUY, with an unchanged fair value estimate of $2.20.

2. Sembcorp Marine

Broker: OCBC

Sembcorp Marine announced that its subsidiaries Sembmarine SLP and Jurong Shipyard have secured offshore energy related contracts valued at a combined $222 million. Sembmarine has won a contract from Siemens to design and build the offshore substation platform for the Dudgeon Offshore Wind Farm, while Jurong Shipyard has been contracted by regular customer MODEC to complete the repair and life extension, and conversion of a very large crude carrier into a floating production storage and offloading vessel.

With these contracts, Sembcorp Marine has secured new contracts worth about $3.9 billion year-to-date, accounting for close to our full year new order win estimate.

Maintain BUY with fair value of $4.18

3. Nam Cheong

Broker: OSK-DMG

Nam Cheong launched its first proprietory-design diesel-electric anchor handling tug supply vessel, the NCA80E, last Friday. Customers signed letters of intent worth US$186 million for a mix of "sale and charter" for 12 vessels, with options taken for the remaining eight in the series. Thus its vessels are sold out for the next three years.

The company has convincingly showed an ability to sell vessels even with oil priced at US$85 a barrel.

Maintain BUY with a target price of $0.58

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