CAPITALAND | NEUTRAL
TARGET PRICE: $3.60
MARCH 1 CLOSE: $3.60
RHB Research Institute, March 1
Maintain "neutral", with a revised target price of $3.60 - from $3.15, 1 per cent downside - as we expect limited upside post the recent run-up in its share price (+20 per cent year to date).
We see two key reasons for its recent outperformance:
CapitaLand's focus on asset-light strategies to enhance returns and renewed interest in developers amid a spate of privatisation talks.
Recurring income is set to receive a boost, with contributions from the Ascott acquisitions and the opening of eight retail malls this year.
Still, operating conditions continue to remain challenging in its core markets.
FIRST RESOURCES | BUY
TARGET PRICE: $2.15
MARCH 1 CLOSE: $1.875
DBS Group Research, Feb 28
We expect First Resources to book a strong 54 per cent earnings growth this year - premised on volume recovery.
We also expect relatively strong crude palm oil and palm kernel average prices to continue this year, partly offset by slightly lower expected biodiesel output and thin refining margins.
In this report, we reiterate our "buy" rating on 15 per cent potential upside (excluding two per cent dividend yield).
FR's aggressive planting in East and West Kalimantan between FY12 and FY14 will contribute to the group's strong volume and earnings growth through FY18F.
Subject to opportunistic acquisitions, we expect its output growth to decelerate from FY19F, as new planting is forecast to moderate from FY16 onwards (excluding new acquisitions).
CHUAN HUP | BUY
TARGET PRICE: $0.30-0.305
MARCH 1 CLOSE: $0.265
UOB Kay Hian, March 1
The stock could have bottomed out at $0.23.
As the stock continues to trade above the middle Bollinger band, risk of further upside towards $0.30-0.305 could be in store.
Technically, the parabolic stop-and-reversal has turned positive for the first time since August last year.
The moving average convergence divergence indicator looks poised to move above its centreline and did not form a lower low when price action did so with a low of $0.23.
Bets are off should the stock move below its middle Bollinger band.
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