Compiled by Navin Sregantan
ISDN HOLDINGS LIMITED
| ADD (INITIATE)
MAY 23 CLOSE: $0.225
TARGET PRICE: $0.32
CGS-CIMB, May 22
ISDN is an engineering solutions company specialising in integrated precision engineering and industrial computing solutions.
In our opinion, there are immense opportunities for ISDN arising from what has come to be known as the fourth industrial revolution.
They include technologies using artificial intelligence, collaborative robots and 3D printing, all of which require some form of motion control.
ISDN's engineers are actively engaging existing and potential customers to offer its services and to explore opportunities for collaboration.
In February, ISDN announced that it will issue nearly 27 million new shares to private equity fund Novo Tellus. ISDN believes Novo Tellus has deep expertise in its core business sectors and would be able to contribute positively to its business.
Potential re-rating catalysts for the stock could come from stronger-than-expected sales orders for its mainstay motion control business and profit contribution from its clean energy segment.
Key downside risks to our call include order delays and cost overrun in its energy business
FRASERS CENTREPOINT TRUST (FCT)
| BUY (UPGRADED)
MAY 23 CLOSE: $2.44
TARGET PRICE: $2.71
RHB Research Institute, May 23
Causeway Point, FCT's largest retail mall, will benefit from the development of Northern Gateway and Woodlands Regional Centre.
More office buildings will sprout up around Causeway Point, bringing a larger office crowd to the suburban mall during weekdays.
It acquired a 33.3 per cent stake in Sapphire Star Trust (SST), which owns suburban retail mall Waterway Point. FCT has also taken up a 18.8 per cent stake in PGIM Real Estate Asia Retail Fund (PREAF).
PREAF owns and manages six retail malls - Tiong Bahru Plaza, White Sands, Hougang Mall, Century Square, Tampines 1 and Liang Court, and one office building Central Plaza.
According to press reports, CapitaLand and City Developments are looking to jointly acquire Liang Court from PREAF. If a deal is struck, PREAF would sharpen its focus on suburban retail malls.
We expect the stakes taken up in SST and PREAF to account for 29 per cent of net property income in FY2020.
Positive newsflow on rising retail rentals, yield-accretive acquisitions or asset enhancement opportunities are positive price catalysts for FCT.
Disclaimer: All analyses, recommendations and other information herein are published for general information. Readers should not rely solely on the information published and should seek independent financial advice prior to making any investment decision.
The publisher accepts no liability for any loss whatsoever arising from any use of the information published herein.
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