2011 Sept26 No491 Ca Theedgespore

THEEDGE SINGAPORE | THE WEEK OF SEPTEMBER 26, 2011
HIGHS&LOWS
| BY CHAN CHAO PEH |
I
nvestors who are clinging on to the pos-
sibility of some quick rebound are seeing
their hopes diminishing. Following what
is seen as the latest half-hearted measure
by the US Federal Reserve to add another
bandage on the worlds largest economy on
Sept 21, Asian markets, led by Hong Kong,
fell in unison the next day.
The Hang Seng Index crashed below the
18,000 mark to close at 17,911.9 points on
Sept 22, down 1,006 points since Sept 19.
The Hong Kong bourse at its lowest level
since July 2009 was also dragged down by
a report suggesting that Chinas manufactur-
ing looks set to contract for the third straight
month for September. The Kuala Lumpur Com-
posite Index also went below a psychologi-
cal barrier of 1,400 to close 2.2% down on
Sept 22 at 1,387.81 points. By contrast, the
Straits Times Index (STI) was down a rela-
tively mild 36.7 points since Monday to close
at 2,720.53 points on Sept 22.
In a strategy report released on Sept 21,
DBS Vickers warns investors to brace for
more volatility. Cash is king. We will stay
defensive and expect a broad trading range
of 2,590 to 2,950 points on the STI till theres
better clarity on the macro front, the bro-
kerage states.
Unfortunately, this clarity is precisely what
is missing. To date, the eurozone crisis is show-
ing no sign of abating, with Italys downgrade
the latest stumble in an increasingly tiring se-
ries of surprises, non-events and disappoint-
ments. We believe the euro area is already
in a recession, and we believe the euro cri-
sis will get a lot worse. The US may avoid a
recession with a bit of luck, but growth will
remain low, says William de Gale, a portfo-
lio manager with BlackRock.
In another dark scenario raised by DBS
Vickers, the debt crisis will worsen and the
euro monetary union might just break up.
This will possibly send the STI down to 2,030
points. While this scenario appears fairly
remote at this juncture, developments thus
far do not suggest an early end to the crisis,
casting a pall over the markets, states the
brokerage.
Meanwhile, for investors who still have an
appetite for risk, DBS Vickers recommends
they stick to two types of stocks: The defen-
sive yield plays and those that already have
prices in a recession scenario.
Under the first category are the usual favour-
ites such as the real estate investment trusts
(REITs), ComfortDelGro, ST Engineering,
SIA Engineering and StarHub, all of which
can be leaned on to continue returning div-
idend yields of more than 4%. DBS Vickers
also likes some undervalued counters. For ex-
ample, CapitaLand is now trading at an esti-
mated 0.8 times price-to-net book value, and
40% below the price target of $4.34. The de-
veloper has been actively buying back its own
shares, which should provide the necessary
support for the price. The stock closed on
Sept 22 at $2.52.
ComfortDelGro, the dominant taxi and bus
operator, is already trading at below DBS Vick-
ers recession case scenario price target of
$1.47 there is no growth in bus ridership
and only 6% growth in Northeast MRT line
ridership, which the company also runs. In
fact, in a recession, assuming oil price re-
treats, this should be a positive for the coun-
ter, writes DBS Vickers.
Also recommended for inclusion in the
shopping list are Genting Singapore and Glo-
bal Logistic Properties. For the casino oper-
ator, besides an attractive valuation, there is
the possibility of junket operations which
bring in the whales becoming a poten-
tial wild card. DBS Vickers likes Global Lo-
gistic Properties for its good execution track
record, strong fundamentals and compelling
valuations. And besides strong cash genera-
tion from its Japan operations, there is also
growth potential from China.
For REITs, DBS Vickers likes Mapletree
Commercial Trust, Mapletree Logistics Trust,
CapitaMall Trust, Cache Logistics and Fra-
sers Commercial Trust. Their expected div-
idend yield for this year ranges from 5.1%
and 8%, which beats what long-term bonds
can offer.
As always, there are a few bright spots
amid the general gloom and doom. Lian Beng
Group, which is in construction and proper-
ty development, is one of them. The compa-
ny on Sept 19 announced plans to spin off
its engineering and concrete businesses for
a listing in Taiwan. Together, these two busi-
nesses accounted for 17% of Lian Bengs prof-
its. The stock, which ended at 34.5 cents on
Sept 19, closed at 37.5 cents on Sept 22 on
heavy volume.
Broker Kim Eng, which resumed coverage
on this stock with a buy and price target of
62 cents, likes the Taiwan listing as this will
further solidify its cash position while allow-
ing these businesses to grow independently
and be self-funding, writes analyst Ooi Yi
Tung. The companys construction business,
underpinned by a bulky order book of $839
million, generates $70 million in free cash flow
on top of the $150 million Lian Beng already
has in the kitty. There is no shortage of jobs
as the group has the highest market share of
construction contracts from government land
sale sites sold since 2009 that are gradually
coming onstream, writes Kim Engs Ooi.
Also, public sector housing is set to get busy
as the government on Sept 22 announced its
biggest-ever launch of 8,200 flats.
Furthermore, of the three main contractors
on Kim Engs radar, Lian Beng, at a price-to-
earning ratio of 3.9 times, is the most under-
valued. By contrast, Lum Chang and Tiong
Seng are trading at around 6.3 times, high-
er than the sector average of five times. Per-
haps, as a sign of the times, domestic plays
with big exposure to government contracts
will play a much bigger part in the portfoli-
os of investors as they hunker down to ride
the volatility.
Brace for volatility
Investors should stick with defensive yield plays, says DBS Vickers
HIGHLIGHT
Billionaire Quek Leng Chan raises
deemed stake in GuocoLeisure
INSIDER MOVES PG34
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Sept 15 16 22 21 20 19
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Straits Times
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1387.81
KLCI
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11433.18
Sept 15 21 20 19 16
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11433.18 3.1 1
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8560.26
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8668.86 6
Nikkei
Sept 15 16 19 22 20 21
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3000
Hang Seng
17911.95
19181.5
Sept 15 21 22 20 16
Brokers Digest ................. 36
Global markets round-up ... 38
Regional companies
earnings estimates ............ 39
Singapore companies
earnings estimates ............ 40
Bonds ................................ 41
Right Timing ...................... 42
Trading Ideas .................... 44
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28 THEEDGE SINGAPORE | SEPTEMBER 26, 2011
COVER
STORY
| BY GOOLA WARDEN |
I
nvestors who got out of stocks in the past
month and sought refuge in cold, hard Sin-
gapore dollars might now be growing con-
cerned about the way our home currency
is sinking versus the US dollar.
The USD/SGD cross-rate moved from about
$1.2846 at the beginning of the year to as low
as $1.20 on Aug 1. But it has snapped back to
$1.2906 over the past 17 trading days to Sept
22. Meanwhile, the Straits Times Index has lost
15% this year, significantly underperforming the
8% decline in the Standard & Poors 500; and
US Treasury bonds have risen by as much as
8%. These moves come in the wake of growing
concern about global economic growth, and the
impact that would have on Singapore.
The recent weakening is because of risk
aversion and a flight to quality, says Irvin Seah,
an economist at DBS Bank. In times of un-
certainty, people move to US Treasury bonds.
This appeared to be further exacerbated by the
US Federal Reserves announcement on Sept 21
of plans to replace its holdings of short-term
debt with longer-term debt in order to flatten
the yield curve and stimulate growth. Under
the programme, which will stretch to June
2012, the Fed will buy US$400 billion ($507.5
billion) of bonds with maturities of six to 30
years, while selling an equivalent amount of
debt maturing in three years or less.
That should put downward pressure on
longer-term interest rates and help make broad-
er financial conditions more accommodative,
says the Federal Open Market Committee in a
statement. Yet, some analysts say the move un-
derscores the parlous state of the US economy,
as well as the growing strains in global finan-
cial markets. It also suggests that the Fed no
longer has the capacity to continue a full-scale
quantitative easing programme. The Feds bal-
ance sheet is very stretched, and the only way
to buy more Treasuries is to sell some, says
Leong Wai Ho, a senior regional economist at
Barclays Capital.
What does all this mean for the Singapore
dollar? Seah of DBS says it points to weakness
in the Singapore economy, and the growing like-
lihood of the Monetary Authority of Singapore
(MAS) shifting its policy on the Singapore dol-
lar to one of more gradual appreciation. Singa-
pore manages its monetary policy through the
Singapore dollars exchange rate versus a bas-
ket of currencies, accelerating the rate of ap-
preciation to tighten policy and decelerating it
to loosen its stance. Seah says the market has
been pre-emptively pricing a monetary easing
in Singapore.
Leong of Barclays Capital has a similar prog-
nosis. We see a clear downside risk emanat-
ing from external demand and that is going to
shift market perceptions, he says, adding that
he expects MAS to ease the rate of the Singa-
pore dollars appreciation to 1% from 3.5%
currently.
Singapore dollar
Recent volatility in foreign exchange markets has wiped out much of the
past years appreciation of the Singapore dollar versus the US dollar. What
sparked the crash? Where is our home currency headed now?
This shift in expectations has had a dramat-
ic effect on financial markets partly because
central banks in the region have spent most of
the past year fighting inflation instead of stav-
ing off slower growth. In the wake of the Feds
massive quantitative easing programme over
the past two years, prices of everything from
commodities to real estate have soared in Asia,
forcing interest rates to rise and Asian curren-
cies to appreciate versus the US dollar. The
longer Europe remains in crisis, the higher the
probability of easier monetary policy in Asia,
says DBS in a report dated Sept 21.
But will the flight of capital to US Treas-
uries turn into something more ominous for
Asia? Could asset prices pumped up by suc-
cessive rounds of quantitative easing now sink
precipitously? What impact would that have
on Asias banks?
Economists at the Canadian-based Bank
Credit Analyst have already raised the alarm-
ing spectre of capital flight from emerging mar-
kets as their currencies collapse. In a report
dated Sept 20, BCA argues that emerging-mar-
ket currencies have experienced a technical
breakdown against the greenback. The lat-
est depreciation in emerging-market currencies
should be viewed as confirmation of a bear
market in emerging-market risky assets, the
BCA report states. Trade-weighted US dollar
strength is consistent with a deflationary eco-
nomic environment globally.
On Sept 20, the International Monetary Fund,
in its Global Financial Stability Review, warned
that emerging markets including emerging Asia
could face an outflow of funds. As much as
US$21.8 billion could flow out from Asian eq-
uity markets, the IMF estimates. This is twice
the US$11.9 billion outflow during the global
financial crisis of 2008. Furthermore, if growth
falls and the European and US sovereign debt
crises worsen, outflows could rise to as high
as US$38.3 billion, the IMF suggests.
Additionally, the IMF pointed out that the
global economy has entered a dangerous
new phase of sharply lower growth. Euro-
zone growth will fall to 1.6% this year, and
will register a paltry 1.1% the next. Global
growth will shrink to 4% in 2012, down from
5% in 2009 and the US is likely to have weak
growth for years to come.
Singapore is already feeling these global
headwinds. Leong of Barclays Capital notes in
a report dated Sept 21 that about one quarter of
Singapores non-oil domestic exports (NODX)
were shipped directly to the US and euro area
in 2010. But this is an underestimate of the
true share of exports to these regions, since
they are also significant end-buyers of inter-
mediate goods exported from Singapore for as-
sembly and processing elsewhere. Apart from
trade links, external shocks can be transmitted
through other channels, he states.
In the wake of the 2008 global financial cri-
sis, the IMF estimated that, taking into account
financial linkages, a one percentage point de-
cli
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THEEDGE SINGAPORE | SEPTEMBER 26, 2011 29
COVER
STORY
Jan 10 July 10 Jan 11 July 11
SGD to stop depreciating
95
97
99
101
103
105
107
109
111
113
DBS SGD NEER and policy band
SGD sell-off
overdone
Singapore is leveraged to
global business cycle
8
6
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4
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10
5
0
-5
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-15
-20
-25
1Q00 2Q00 3Q02 4Q03 1Q05 2Q06 3Q07 4Q08 1Q10 2Q11
US GDP (% y-o-y)
SG GDP (% y-o-y, RHS)
Euro Area GDP (% y-o-y)
Sept 26, 2008 Sept 22, 2011
USD/SGD cross rate
($)
B
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B
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1.15
1.20
1.25
1.2986
1.35
1.40
1.45
1.50
1.55
cline in US GDP growth would subtract 0.9
percentage points from Singapores growth. In
July, Singapores industrial production, exclud-
ing the volatile biomedical segment, fell 5.6%.
The city-states August electronics Purchasing
Managers Index also dipped to its lowest level
since February 2009.
Impact on banks
Front and centre in the potential fallout from a
combination of lower growth, capital flight and
declining asset prices are Singapores banks:
DBS Group Holdings, Oversea-Chinese Bank-
ing Corp and United Overseas Bank. Although
their share prices have fallen between 5% and
9% since August, investors should brace them-
selves for further downside, analysts say.
Leng Seng Choon, an analyst at OSK DMG,
expects the persistent problems in the EU and
US to dampen loan expansion and raise con-
cerns on asset quality. The three banks are
currently trading at close to one standard devi-
ation below the historical price-to-book mean.
During the height of the SARS panic in March
and April 2003, the banks traded at close to
two standard deviations below the historical
mean, he says, in a report dated Sept 20.
At their nadir during the global financial cri-
sis, in March 2009, shares in the three banks
sank to an even more drastic three stand-
ard deviations below their historical price-to-
book mean, says Lengs report. While it is
still uncertain if we would witness a repeat
of the earlier crises, we see no catalysts driv-
ing banks share prices in the short term, he
says. The nine-year historic price-to-book for
DBS is 1.34 times, for OCBC 1.52 times, and
for UOB 1.59 times.
Among the first signs of trouble would be
a slowdown in loans growth. Leng is project-
ing loans growth of 8% to 8.5% in 2012 for
the three banks. Thats down sharply from this
years loans growth expectations of 16% to 20%.
There remains the risk of further downside,
particularly for corporate loans, he warns.
In the end, however, it is provisioning for bad
loans that will do the most damage to their
earnings. The average non-performing loan ra-
tios of 1.5% at the local banks as at June 30
are at their lowest in 12 quarters.
Of the three banks, Leng figures that UOB
is the safest bet now for investors who want to
take advantage of the sell-off, even though its
shares have actually performed the best recent-
ly. UOB has delivered a total return (including
dividends) of minus 1% this year, Leng calcu-
lates. By comparison, DBS has returned neg-
ative 11% and OCBC negative 13%. UOBs
conservative loan stance over the past three
years [9.7% loan compound annual growth
rate, versus DBSs 12.5% and OCBCs 15.6%]
and greater focus on housing loans will help
to keep its asset quality high, and hence pro-
visions low, Leng says.
As it happens, shares in UOB are also trad-
ing at one standard deviation below its his-
toric price-to-book ratio, while shares in DBS
and OCBC are at less than one standard devi-
ation below their respective price-to-book ra-
tios. As Leng sees it, shares in DBS could be
weighed down by narrowing interest spreads,
while shares in OCBC are still relatively ex-
pensive. We see no catalyst driving DBSs
share price, as Sibor is seen to remain soft till
around 2013. OCBCs current [price-to-book
ratio] is higher than its peers which limits
share price upside.
But should investors even be thinking about
buying risk assets at this point? Should they
gradually accumulate relatively low-risk stocks?
Or, wait for a crash and scoop up more cycli-
cally oriented stocks?
Like Mount Vesuvius
Gauging the likelihood of a full-blown crisis
in Europe and major recession in the US is
tough, because much really depends on how
politicians and policymakers in those coun-
CONTINUES ON PAGE 33
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COVER
STORY
Goldman Sachs stock ideas
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Name of Country Rating Quoted Price Potential upside/ 2011 PER 2011 Dividend
company currency downside (times) yield
(%) (%)
China Construction Bank China Buy HKD 8.18 29 7.3 5.1
Singapore Telecommunications Singapore Buy SGD 3.03 13 12.8 7.4
Sun Hung Kai Properties Hong Kong Buy HKD 98 60 13.2 3.8
POSCO South Korea Buy KRW 389,500 46 9.0 2.4
Bharti Airtel India Buy INR 390.1 15 23.0 0.2
Wesfarmers Australia Buy AUD 30.2 35 16.3 5.3
ICICI Bank India Buy INR 879 26 17.0 1.8
Bank Mandiri Indonesia Buy IDR 5,750 18 14.3 2.5
PTTEP Thailand Buy THB 159 29 10.5 3.8
CIMB Group Holdings Malaysia Buy MYR 6.77 31 13.4 3.7
Jardine Cycle & Carriage Singapore Neutral SGD 39.58 -1 12.9 2.9
Genting Bhd Malaysia Buy MYR 8.9 38 12.5 1.6
SJM Holdings Hong Kong Buy HKD 14.82 40 15.4 3.3
Philippine Long Distance Philippines Neutral PHP 2,240 -1 11.5 9.0
KT Corp South Korea Buy KRW 36,350 28 5.8 7.0
China Telecom China Buy HKD 4.96 9 17.9 1.7
Evergrande Real Estate Group China Buy HKD 3.22 109 4.8 5.2
E-Mart South Korea Buy KRW 322,500 7 13.5 0.5
PT XL Axiata Indonesia Buy IDR 2,825 27 13.5 1.5
Anhui Couch Cement China Buy HKD 22.55 58 6.9 1.9
Guangdong Investment China Buy HKD 4.98 15 10.3 3.8
Largan Precision Taiwan Buy TWD 768 22 19.9 1.6
Intime Department Store (Group) Co China Buy HKD 9.2 27 20.9 1.9
Taishin Financial Holdings Taiwan Buy TWD 11.9 23 9.7 2.1
Mapletree Commercial Trust Singapore Buy SGD 0.85 16 18.6 5.9
IRB Infrastructure Developers India Buy INR 169.6 21 10.6 0.9
| BY GOOLA WARDEN |
T
imothy Moe, managing director of
Goldman Sachs Global Investment Re-
search unit, based in Hong Kong, has
more than one view of Asian markets.
That reflects the enormous uncertain-
ty in European and US markets in the weeks
ahead. And, how investors position themselves
largely depend on how they believe things will
play out, he says.
To be sure, Asian markets as represented
by the MSCI Asia ex-Japan index have already
taken a significant hit in recent weeks, falling
some 20% since July. At current levels, they
are already at the low end of their 20-year val-
uation range, says Moe. By his calculations,
the MSCI Asia ex-Japan index is now trading
at only 10.4 times forward earnings. Thats
1.6 standard deviations below the mean.
In terms of trailing price-to-book multiples,
the MSCI Asia ex-Japan index is hovering at
about 1.7 times, which is higher than the lows
of 1.3 times witnessed in some previous crises,
but still almost one standard deviation below
the average. From a valuation standpoint,
were pricing in a certain amount of concern
in Asian markets, Moe concludes.
Yet, the global situation is so fluid at the
moment that it is impossible to judge with any
certainty if the economic growth and corpo-
rate earnings assumptions that underlie the
markets current valuation metrics are reason-
able, Moe adds. The tricky part here is you
cannot say that all the risk of a much harsher
case has been priced in.
So, whats an analyst to do?
Moe has come up with three alternative sce-
narios, and the corresponding corporate earn-
ings forecasts for each case. Goldmans baseline
forecasts are for restrained, sub-trend economic
growth in the US of 1.6% this year, and 2.2%
next year. For the European Union, it is fore-
casting 1.8% for this year, and 1.2% next year,
based on its baseline assumptions.
One notch down from this baseline is the sec-
ond scenario where the recession is harsher, and
there is a heightened form of credit stress. The
risk to our numbers is to the downside. We think
there is quite a high chance for what we would
call stall speed in aeronautical terms. That ba-
sically means that developed economies slow
enough to tip them into recession. Our econo-
mist thinks there is a one-in-three chance of re-
cession in both the US and EU, Moe adds.
Finally, Goldmans worst-case scenario
would be if Greece defaults and is forced out
of the euro. In that situation, European banks
would suffer a massive hit to the value of the
assets they are holding. A simple calculation
places this at one to two times their aggregate
Tier-1 capital, if you have something that is
not properly orchestrated, Moe figures. But he
hastens to emphasise that the likelihood of this
happening is remote. We think the probabil-
ity of an uncontrolled unwinding of the euro
is very low, mainly because the consequences
of that would be so adverse that policymakers
will do their utmost to avoid that.
How does all that translate into corporate
earnings forecasts for the MSCI Asia ex-Japan
index? What does it mean for investors?
On Goldmans baseline assumption of pro-
longed slow growth in the US and Europe, it ex-
pects earnings growth in the MSCI Asia ex-Japan
region to top 11%. Under the second recession-
ary-type scenario, forward corporate earnings
growth in the region is likely to be a much more
anaemic 3%. And, in the event that Greece leaves
the euro, Goldman figures that Asian corporate
earnings would contract by 17%.
Over the next few months, investors in Asia
will likely be whipsawed by the flow of news
from the US and Europe, as markets discount
the various possible scenarios. The credit side
of things in the EU is very complicated. Its an
ongoing drama with many twists and turns,
Moe says. Even under our baseline, we think
its going to be a long drawn out affair without
any resolution and there is a risk of some form
of less palatable nasty credit shock.
Bulls versus bears
Yet, under Goldmans base case scenario, the
MSCI Asia ex-Japan index could recover by as
Goldmans Moe handicaps Asian
stocks as euro crisis deepens
Moe: The tricky part here is you cannot say that all the risk of a much harsher case has been priced in
B
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Sept 26, 2008 Sept 21, 2011
MSCI Asia ex-Japan
Volume (000) Price ($)
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much as 30% in a year, in US dollar terms. That
reflects Goldmans forecast of 11% corporate
earnings growth, a 3.5% dividend yield, some
expansion in stock valuations and some appre-
ciation in Asian currencies against the US dollar.
So, if you add it all up earnings growth, ex-
pansion in multiples, some dividend yield and
modest currency appreciation the US dollar
return could easily be 25% to 30%, says Moe.
That sounds very optimistic. But the numbers
are very easy to arrive at. And, that gets us back
to where we were nine months ago. Were 20%
down from the July highs.
The problem for investors who are inclined
to be bullish is that the harsher scenarios have
probably not been fully priced into the regions
markets. Hence, there is a risk of markets go-
ing lower in the short term. In a more adverse
global environment, companies in Asia would
see their earnings crushed by negative operating
leverage while banks could start to see higher
non-performing loans, Moe cautions. Under the
harsher case, we think there could be 20% more
downside to Asian markets before the earnings
compression would be fully reflected.
Against such a backdrop, Moe says Asian eq-
uity markets are likely to be skittish and vola-
tile, perhaps retesting the lows set during the
past month. Weve got to remember there is a
lot of concern in the global picture, which Asia
could be affected by and thats something we
have to include in our advice to investors.
Lower risk and hedge
What should investors do? We think the parts
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| BY ANDREW BARY |
W
ith Europe seemingly at a finan-
cial precipice and its bourses
down 20% this year, the shares
over there are very cheap. As
measured by the Euro Stoxx 50,
they trade at eight times earnings and near
book value, with dividend yields above 5%,
according to Bloomberg data. The Standard
& Poors 500, off just 3.3%, is valued at 12
times this years earnings; it fetches more than
two times book and yields 2.2%.
Investors may have begun to notice this
relative bargain; European markets rose 4%
earlier this month, as global central banks
moved to provide US dollars to some of Eu-
ropes embattled banks. But
if this is an incipient trend,
theres probably time to jump
aboard. Investor caution hing-
es on three main issues: con-
tagion risk, if Greece defaults
or restructures; future liquidity
risk for Europes banks; and
deep recession. Most coun-
tries are pursuing restrictive
fiscal policies, and econom-
ic growth has slowed, even
in powerhouse Germany. Bar-
clays European equity strat-
egist Edmund Shing writes
that Europes stocks are al-
ready discounting a mild
recession.
These arent trivial risks,
but they are, to some extent,
already priced in. European eq-
uity valuations are way below
historical levels, with Germa-
nys DAX at its lowest price-to-
earnings ratio (PER) in more
than two decades. August was
the worst month for European
stocks since 1987. Yet, most big
European companies have size-
able amounts of cash, and of-
fer significant exposure to the
developing world.
A dozen blue-chip Euro-
pean stocks now look appeal-
ing, including Daimler, the
producer of Mercedes cars
and Freightliner trucks, Royal
Dutch Shell, Nestl, Unilev-
er, Vodafone and Siemens.
This is a conservative list,
with just one financial issue: global bank-
ing giant HSBC.
Earlier this month, Crdit Suisse equity
strategist Andrew Garthwaite urged a sub-
stantial overweighting in the UK market, cit-
ing a likely expansive monetary policy mod-
elled on US quantitative easing. Neither the
UK nor Switzerland is in the eurozone, and
thus have more monetary and fiscal flexibil-
ity. Their markets have some of the highest
PERs in Europe.
Negative sentiment towards Europe may
be a good contrary indicator. European re-
tail investors are abandoning the market,
writes Barclays Shing. One US adviser tells
Barrons he is tempted by European stocks
but afraid his clients would be unhappy,
given all the bad headlines.
One private investor says he has been buy-
ing European stocks such as Nestl, Unilev-
er, Vodafone and Royal Dutch Shell. He says,
The only true triple-A credits in the world are
high-quality global companies. The spread
between European dividend yields and corpo-
rate-bond yields is at near-record levels.
Note: The 10 European stocks we liked
amid last years weak market spell have hand-
ily bested the Euro Stoxx 50, rising 20% based
on prices of their US-listed shares earlier this
month, against a 20% drop for the index. A
13% rise in the euro helped the US shares.
An appealing feature of these names is their
net dividend yields after European withhold-
ing taxes. Even before the recent selloff, Eu-
rope was a dividend mecca, since most Eu-
ropean managements and investors prefer
dividends to stock buybacks.
Royal Dutch Shell, whose US shares trade
near US$67, probably has the strongest div-
idend outlook among major European oils.
Morgan Stanley analysts started coverage of
the stock early this month with an over-
weight rating, writing that with sever-
al large projects coming onstream in the
coming years, free cash flow will rise, al-
lowing the company to boost its dividend.
Total, the French oil company, has a high
dividend yield of 6.9%, but less room to
boost its payout in the coming years, ow-
ing to high capital expenditures, according
to Morgan Stanley.
A flush Daimler, whose US-listed shares
fetch around US$50, now trades for just six
times projected 2011 profits. Its dividend yield
is 4%, and it has almost US$20 a share in net
cash, although it has some unfunded pension
liabilities. Daimler is benefiting from its cars
popularity in the developing world. And Re-
nault is now an attractive sum-of-the-parts
story. Its stock, at 27 (the US shares are very
illiquid), trades at about half the value of its
stakes in public companies, notably a 43%
interest in Japans Nissan. This ignores its fi-
nance business and automotive operations.
Renault has often traded below the value of
its Nissan stake, but the gap is particularly
wide now.
Shares of consumer-products giant Uni-
lever do not fully reflect the companys re-
structuring efforts; they trade at US$31, or
about 13 times projected 2011 profits. With
more than half its sales coming from emerg-
ing markets, Unilever is one of the best de-
veloping-market stories among major con-
sumer companies. It also has
valuable controlling stakes in
publicly traded Indian and In-
donesian units. And Nestl
is off its spring peak, trading
around US$56, or 15 times es-
timated 2011 profits. Thanks
to a broad portfolio and ge-
ographic reach, Nestl could
be the best long-term story in
the food industry.
Frances Sanofi has one of
the lowest PERs of any drug
maker, around seven times;
its stock trades near US$33.
Sanofi should get past most of
its patent expirations next year
without too much pain. It re-
cently offered a bullish multi-
year forecast starting in 2012.
It has a lucrative diabetes fran-
chise and significant develop-
ing-world exposure.
Novartis has a better-than-
average outlook among phar-
maceutical majors, thanks in
part to its control of eye-care
giant Alcon, and its shares, at
around US$56, trade about 10
times estimated 2011 profits.
Vodafone and Verizon Com-
munications share ownership
of Verizon Wireless each
companys best asset. Verizon
owns 55% and Vodafone, 45%.
At US$26, Vodafone trades
about 10 times estimated prof-
its, a discount to Verizon at 16
times, and Vodafones 5.4%
dividend is more secure than
Verizons because the Vodafone dividend is
a smaller share of its earnings.
European telecoms tend to have high yields,
and Spains Telefnica has one of the high-
est above 8%. Its depressed stock, now
around US$19, reflects concerns about Spain,
Telefnicas hard-hit home market. Yet, Tel-
efnica gets just a third of its revenue from
Spain; the rest comes from the developing
world and elsewhere in Europe.
There are plenty of exchange-traded funds
focused on Europe, too. The Vanguard MSCI
European ETF, a broad-based fund, has a yield
of 5%. There are country ETFs for major mar-
kets, including the iShares MSCI United King-
dom and similar iShares ETFs for Germany,
France and Italy.
In sum, Europe has lots of problems but
it also has plenty of appealing stocks.

2011 Dow Jones & Co, Inc
Time to buy Europe carefully
The risks are by no means inconsequential, but several major
European stocks might now offer good value. Here are a dozen
that operate solid businesses and offer good dividend yields.
Bargain-priced dozen
Judged on fundamentals, these European blue-chips look cheap
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*Past 12 months ***PER for FY ending March 2012
**PER for FY ending September 2011 All data through Sept 22 E = Estimate
COMPANY RECENT YTD 2011E DIVIDEND
PRICE (US$) CHANGE (%) PER (TIMES) YIELD* (%)
Telefnica 19.61 -14.0 8.4 8.1
Total 45.57 -14.8 6.2 6.9
Vodafone** 26.11 -1.3 9.6 5.4
HSBC 41.40 -18.9 9.1 4.6
Royal Dutch Shell 66.86 0.1 8.0 4.3
Daimler 49.58 -26.6 6.7 4.0
Sanofi 33.59 4.2 7.0 3.9
Novartis 56.45 -4.2 10.1 3.6
Unilever 31.29 -0.4 13.4 3.3
Nstle 56.64 -3.7 14.9 3.1
Siemens *** 97.64 -21.4 8.9 2.8
Renault 27.07 -37.8 3.9 1.1
How they stack up
Comparing six of the worlds major stock markets
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MARKET VALUE YTD (%) 2011E PRICE-TO- DIVIDEND
CHANGE PER BOOK YIELD (%)
(TIMES) RATIO (TIMES)
Euro Stoxx 50 2,157.22 -22.8 7.9 1.0 5.5
FTSE 100 (UK) 5,368.41 -9.0 9.5 1.6 3.8
CAC 40 (France) 3,031.08 -20.3 8.2 1.0 5.2
DAX (Germany) 5,572.23 -19.4 8.6 1.2 4.3
Swiss Market 5,452.88 -15.3 11.7 2.1 2.7
Standard & Poors
500 Index 1,216.01 -3.3 12.2 2.0 2.2
of Asia to be focusing on would be the areas
which are more domestically driven and there-
fore not affected by the fundamentals in the
G2 [US and Europe], where the growth con-
cerns are emanating from, says Moe. That
means domestic cyclicals, consumer staples
and telcos.
Moe also recommends hedging long equi-
ty positions in Asia. We have a couple of de-
rivative ideas, the simplest one being to have
puts on the Indian Nifty Index, he suggests.
Thats the cheapest index to hedge globally
right now. So, if you look at the volatility and
the pricing of puts on various indices, the Nifty
is abnormally cheap right now. Thats a good
way of getting some tail risk hedge without
paying too much for it.
Another way to improve the certainty of re-
turns from Asian equities is to focus on stocks
that deliver a high proportion of their returns
through dividends. Goldman has identified 25
companies in the region with dividend yields
of more than 7%, and whose dividend pay-
outs are relatively secure. Among them are Sin-
gapore Telecommunications and Mapletree
Commercial Trust in Singapore, and CIMB and
Genting Bhd in Malaysia. These are compa-
nies that are fundamentally strong and will be
able to pay their dividends, Moe says.
As for investors who are more optimis-
tic about a resolution in Europe, Moe rec-
ommends positioning for a sharper recovery.
The parts of Asia that would rally the sharp-
est and quickest are those that have been
sold down the most in the last month or two.
These would be global cyclical stocks, such
as companies in the technology sector, trans-
portation, or commodity related names, says
Moe. Among them would be stocks such as
LG Display, Daewoo Shipbuilding and En-
gineering, Samsung Heavy Industries and
Hyundai Heavy Industries.
Malaysia, Indonesia good bets
Within the Asia ex-Japan region, the Asean 4
markets Malaysia, Indonesia, Thailand and
the Philippines also look well positioned.
These markets are largely domestically ori-
entated and Moe particularly likes Malaysia
and Indonesia.
There isnt a widespread understanding
of the objective and progress being made in
the Economic Transformation Programme of
Malaysia, he says, referring to broad-ranging
reforms that the government of Prime Minis-
ter Datuk Sri Najib Tun Razak has been rolling
out. In fact, Malaysia has been quietly outper-
forming the rest of the region this year. While
the larger markets are down almost 20%, Ma-
laysia is down only 4% to 5% for the year,
Moe points out.
Unlike Malaysia, however, Indonesia and
Thailand are widely owned by mutual funds,
says Moe. If you get a global risk off event,
there is the potential for foreign capital to exit
those markets. In emerging markets, when you
get a risk off event, you could get some gappy
downward price movements, he warns. Accord-
ing to Moe, Thailand has the highest overweight
in mutual fund investments in Asean.
As for Singapore, it is more liquid and clear-
ly more vulnerable to global crises because of
its free and open economy, says Moe. Look-
ing at equity markets and valuations, the in-
dex here is pretty well dominated by banks
and properties. All that suggests that there is
a greater degree of sensitivity to the global as-
set price cycle, and we are somewhat less op-
timistic about Singapore, he says.
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COVER
STORY
Tech stocks offer superior growth in
tough market, says BlackRocks de Gale
| BY CHAN CHAO PEH |
T
echnology stocks are often thought to
offer high returns for similarly high
risk. Yet, the technology sector is one
of the few places where investors will
find growth, even during the worst of
times. Rather than run for cover now, inves-
tors might be better off using the current vol-
atility to hunt for bargains in the sector, says
one fund manager.
When people are desperate for growth,
when things are going really badly, one place
where you can always find growth if you look
hard enough is the tech sector, says William
de Gale, a director and portfolio manager for
technology stocks at global fund management
house BlackRock. There are always cyclical
drivers well above the market, where growth is
strong enough to continue even in a recession
it will slow, but you will still grow. And, in
a recession, growth is scarce and there will be
a premium for it.
But, dont gravitate towards established,
heavyweight tech stocks for their supposed
safety, he adds. If you buy mega cap as a
group, you are basically dooming yourself to
underperformance. By its nature, the tech-
nology sector promotes invention, innovation
and obsolescence. Thus, big technology com-
panies have typically already had their day in
the sun, and could be about to be eclipsed by
a new trend.
If you are a mega technology stock, that
means the last 10 years were absolutely per-
fect. Through luck and scale, everything went
right, says de Gale, who runs BlackRocks
World Technology Fund, which has a total
fund size of US$151.3 million ($195.5 mil-
lion). In other sectors, this might continue
for another 10, 20 years. But, in technology,
they are usually not positioned perfectly 20
years in a row.
In fact, de Gale avoids technology sector
bellwethers such as Microsoft and Google that
other funds hold as cornerstones of their port-
folios. The way he sees it, the years of high
growth and fat margins that made Microsoft
the worlds largest software company are now
behind it. The company exploited a once in a
generation opportunity brilliantly, but the PC
business has hit a plateau. In fact, Microsoft
has been trading sideways since 2005.
If anything, it could now be under threat
by an emerging host of alternatives to the PC.
Any tablet that comes out is lost business for
Microsoft. It will take a lot to reverse that, says
de Gale, who has been looking at the technol-
ogy industry since 1997.
On the other hand, de Gale is not avoid-
ing Google because he thinks it is in imme-
diate danger of being overtaken. Instead, he
dislikes its inefficiency in capital deployment.
The metric that de Gale uses to judge this is
NOA/S, or net operating assets as a proportion
of sales. He says Googles NOA/S is 54%. By
contrast, Baidu, often referred to as Chinas
version of Google, has an NOA/S of
1%. Online retailing giant Amazon
has an even more impressive NOA/
S of zero, which basically means the
company is tapping the resources
of its customers and partners rather
than its own.
Why is the NOA/S metric for Goog-
le so different from that of Baidu and
Amazon? Its because Google has
a bloated cost base, a result of all
the free applications it offers, rang-
De Gale: If you buy mega cap as a group, you are basically dooming yourself to underperformance
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ing from email to online file-sharing services,
says de Gale. Google is essentially a typical
engineer-run company. Engineers are great
people, if you want something designed. But
you need some tight control, or else they will
do things at the umpteenth degree, then they
will do it again.
That is not to say Google does not have
a great business that generates prodigious
amounts of cash. Yet, theyve chosen to use
that wealth to change the world for the bet-
ter theyve explicitly said so. Thats fine if
they still own the company. But theyve sold
most of the company to us shareholders,
de Gale grumbles. As a citizen of the world,
Google makes my life better. But as an inves-
tor, I regard Google as a charity and not as an
investible company most of the time.
So, where does de Gale see opportunity
now? What tech stocks is he buying?
Latin American gem
One company he fancies is MercadoLibre, the
dominant e-commerce player in Latin Amer-
ica. Im normally not a huge fan of Internet
stocks because there are few barriers to en-
try, de Gale says. But MercadoLibre (Span-
ish for free market) is sheltered by a signif-
icant barrier to other e-commerce giants, he
adds. Its the blue stuff outside thats called
the sea, he says.
Major Internet companies are usually
spawned in the US, before crossing the At-
lantic Ocean in the east to Europe and cross-
ing the Pacific Ocean in the west to Asia. Few
have any presence or interest in Latin Ameri-
ca. For instance, eBay has no direct presence
in Latin America, except for its 10% stake in
MercadoLibre. And, while it is possible to get
a delivery from Amazon from just about an-
ywhere in the world, the online retailer actu-
ally has a direct presence in only a handful
of countries. The global players arent in the
market at all, they are looking elsewhere, ob-
serves de Gale.
In effect, MercadoLibres real competition
would be the online presence of traditional de-
partment stores and retailers. These are not par-
ticularly sophisticated. Indeed, in many cases,
they have given up and they are in fact using
the MercadoLibre platform to drive their own
websites and they use MercadoLibre to refer
links as much as Google does, de Gale says.
So, this Argentinian-based company pretty
much has the Spanish-speaking New World to
itself. And, it is now benefiting from the growth
of both middle-class spending as well as broad-
band penetration rates in that part of the world.
Moreover, postal ser vices work de-
cently in this region even as the tra-
ditional retailer is relatively underde-
veloped. This sounds wonderful if
you are running an e-commerce busi-
ness, says de Gale, who expects the
company to top 30% growth a year
for many years to come.
Shares in MercadoLibre, which are
traded on Nasdaq, closed on Sept 21,
2.5% down from a year earlier, having
come off a recent peak of US$92.73
achieved in April 28 this year. They are now
trading at 41 times forward earnings.
Hot healthcare play
Another US-listed stock de Gale likes is Cern-
er, a provider of software in the healthcare
industry. The Missouri-based company has
installed its applications in more than 9,000
facilities worldwide. Now, de Gale is betting
that Cerner is a direct beneficiary of the health-
care industrys efforts to put patients medical
records on databases.
My healthcare records in the UK were, until
very recently, written using a biro, on a piece
of card, then put away in a filing cabinet,
says de Gale. Can you even buy a filing cabi-
net now? Already, governments are spending
money to change this. For example, under last
years Health Information Technology for Eco-
nomic and Clinical Health Act (HITECH Act),
the US government designated US$19.2 billion
to help accelerate the adoption of electronic
health records, among other uses.
Could healthcare budgets in the US and Eu-
rope be slashed as their governments struggle
to get a handle on their sovereign debt prob-
lems? De Gale thinks it is unlikely. While health-
care costs will keep escalating, there is little
possibility that people will allow standards to
drop, he says. The population is very sensi-
tive to healthcare and they wont allow their
governments to provide less. And, wider use
of software such as that provided by Cerner is
but one of the many ways the healthcare in-
dustry could improve what it can offer while
trying to hold down costs.
Two European ideas
Like most other fund managers, de Gale is cau-
tious on European markets at the moment. But
he has two European-listed technology stocks
in his fund. One is French satellite operator
Eutelsat Communications, while the other
is ASML Holdings, a Netherlands-based, Nas-
daq-traded maker of equipment that semicon-
ductor producers heavily rely on.
Simply put, ASML makes sophisticated
machinery that shines light through a sten-
cil at a microscopic level, which essentially
casts and burns the circuit on a semiconduc-
tor chip. Japans Nikon, a leading photogra-
phy equipment maker, is also in this space,
but the Dutch company has the lead. If you
are a semiconductor company, every now and
then you have to buy a new piece of equip-
ment from ASML and they cost US$50 million
each, says de Gale.
Moreover, even though ASML is a Dutch
company, it draws only 4.5% of its total rev-
enue from Europe. That is even less than the
4.8% it gets from tiny Singapore. South Ko-
rea and Taiwan, the two leading semiconduc-
tor countries, account for 31% and 30.6% res-
pec tively of ASMLs sales. Furthermore, while
some of the ASML equipment is priced in eu-
ros, in reality, it is selling into an industry that
is denominated in US dollars.
ASMLs shares are currently depressed, much
like shares in most other semiconductor-relat-
ed stocks. The industry is notoriously cyclical,
however, and ASML has a near-monopoly on
a leading-edge process, de Gale points out. It
will recover and ASML will get that business
when it comes back, he says.
In short, ASML might be just what European
investors need now a European stock that
has little exposure to the euro or the regions
economy. It is therefore a very unusual safe
haven in Europe, says de Gale.
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FRO
Some of William de Gales likes and dislikes
COMPANY PRICE AS AT YTD CHANGE EST PER MARKET CAP
SEPT 21 (US$) (%) (TIMES) (US$ BIL)
MercadoLibre 64.10 -2.50 41.27 2.8
ASML 35.76 -6.73 8.19 15.9
Cerner 69.25 46.19 37.82 11.7
Microsoft 25.61 -6.88 9.10 217.8
Google 539.20 -9.22 15.19 173.9
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CAPITAL
| BY GENE EPSTEIN |
P
rophets of doom and gloom are often
criticised for being stopped clocks:
bound to be right, but just twice a
day. Financial-newsletter writer and
best-selling author Harry S Dent Jr,
by contrast, can lay claim to being a proph-
et of boom or gloom, depending on the cir-
cumstances.
Dent is as comfortable calling for Dow
35,000, as he did 13 years ago, as he is
forecasting Dow 3,800 now. His 1998 book,
The Roaring 2000s: Building the Wealth and
Lifestyle You Desire in the Greatest Boom in
History, was a New York Times best-sell-
er. Its bleaker companion, The Great Crash
Ahead: Strategies for a World Turned Up-
side Down, co-written with Rodney John-
son, was published in mid-September. Based
on these and similar titles, Dent swings
for the fences. But not always with grand-
slam results.
Two years ago this month, Dent launched
an exchange-traded fund, Dent Tactical ETF,
whose stated objective is long-term growth
of capital, with Johnson as manager and
himself as adviser and strategist.
The past 24 months havent been espe-
cially rewarding. As at Sept 9, Dents ETF
was flat since inception. Over the same pe-
riod, straightforward ETFs on major index-
es the Standard & Poors 500 Index, Dow
Jones Industrial Average and Russell 2000
realised returns of 15% or more.
No wonder the Dent vehicle only has
US$15 million ($19.4 million) in assets. But
24 months does not a long term make. And
while his wildly overblown prediction for the
2000s came to grief, Dent claims that inves-
tors who read his newsletter were told to take
profits by 2008, before the market collapsed.
As for the crash to 3,800 that he now proph-
esies, you might be able to make a plausible
case for that grim outcome, but that isnt the
case Dent makes.
Harry S Dent Jr (Dent Sr made his name
as a Republican strategist) is basically a con-
sumptionist. As such, he subscribes to the
hoary fallacy that boom-and-bust cycles are
mainly driven by consumer spending. To
make matters slightly worse, Dent is overly
impressed by demographics, believing that
consumer-spending growth is almost exclu-
sively determined by the number of folks in
their peak spending years, which he speci-
fies with excessive precision as their mid-
40s. Since the proportion of people in their
mid-40s is due to decline, we can expect a
great crash ahead.
When I expressed doubts to Dent about
this approach in a recent face-to-face inter-
view, he responded somewhat predictably
by pointing out that consumer spending is
70% of GDP. True enough, but the ups and
downs of the economy are mainly determined
by the remaining 30%.
Right now, for example, economic growth
is hitting stall speed, and real GDP is still
below its 4Q2007 peak. The stock market,
still well below its 2007 highs, reflects this
poor showing.
But to blame the malaise on consumer
spending is quite a stretch. In fact, real con-
sumer spending has already recovered, hav-
ing exceeded its 4Q2007 heights by 4Q2010.
The sick man of the economy and the
original cause of the bust is that broad
category called gross private domestic in-
vestment, meaning investment in plants,
equipment, software, housing and invento-
ries. Despite some gains, real gross private
domestic investment is still more than 16%
below its 4Q2007 peak.
True, growth of personal-consumption
expenditures could be faster, but at a 9.1%
rate of joblessness, it surely has been hold-
ing its own. Moreover, rates of joblessness
crucially depend on the performance of that
other 30% of GDP, where more than half the
economys jobs are normally found.
Consumer spending is by far the most
stable part of private-sector GDP. But to the
extent that we do find differences over long
stretches in consumer-spending growth, we
find no noticeable correlation with the per-
formance of the stock market.
Compare the roaring 1990s (1989 to 1999),
when the S&P 500 quadrupled in value,
with the sick 1970s (1969 to 1979), when
the S&P barely eked out gains. If we sub-
scribe to Dents theory, we would expect to
find that consumer-spending growth in the
1990s far outpaced the rate of the 1970s. In
fact, growth was a bit slower (3.3% a year)
from 1989 to 1999, than it was from 1969 to
1979 (3.5%).
The ageing of the baby boomers may
well bring a slowdown in consumer-spend-
ing growth and a proportionate increase in
the growth of consumer savings. We cant
be sure, since other factors also play a role,
including the rate of unemployment. But to
regard a rise in overall savings as any kind of
disaster is surely nave. For one thing, more
saving also means more investing, which
could, in turn, support stock prices.
Im going to be honest, Dent told me
at one point, in a mild state of exasperation.
I cant explain this to economists. Quite
right.
2011 Dow Jones & Co, Inc

Harry S Dent Jr knows how to sell books. But whether his stock-market strategies
make sense or money for investors is another question.
Harrys dented prophecies
The trouble with Harry
B
L
O
O
M
B
E
R
G
Harry S Dent Jrs Dent Tactical ETF,
launched 24 months ago, is flat. Over the
same period, the iShares S&P 500 Index
Fund ETF has gained 15%.
Dent Tactical ETF vs
S&P depositary receipts
SPY
15%
DENT
0%
Weekly close on Sept 15
-10
0
10
20
30
2010 2011
B
A
R
R
O
N
S
Dent subscribes to the fallacy that boom-and-bust cycles are mainly driven by consumer spending
E
E
ow
rn-
are
has
00
ng
th-
cal
ntil
ece
t,
bi-
ng
ast
co-
ct),
on
nic
Eu-
gle
ob-
th-
tle
to
nsi-
eir
use
r is
in-
ile
au-
But
cks
tor
her
as-
on-
ed
en-
lly
uc-
ra-
ce,
ou
nd
ip-
on
ch
ev-
he
Ko-
uc-
es-
ile
eu-
hat
uch
at-
al,
on
It
ess
an
hat
ns
afe
tries react. Yet, the potential impact
for the rest of the world is so severe
that analysts and investors are pre-
paring for the worst. Its like Mount
Vesuvius, says Leong, referring to
the volcano that buried the ancient
city of Pompeii in AD79.
For his part, Leong reckons that
Singapore will probably escape a tech-
nical recession, albeit by a whisker.
We still believe the economy will
avoid entering a technical recession
in 3Q. For 2012, we are now project-
ing 4% GDP growth, versus 4.5% pre-
viously, he says. In line with our
lower forecasts, we estimate that the
output gap, which was already nar-
rowing in 2Q2011, will fall to zero by
1H2012, and we see a mildly nega-
tive output gap emerging next year,
says Leong in his report.
And, over the medium term, the
rush of global capital into US Treas-
uries is unlikely to last, some ana-
lysts say. There are many very sol-
vent governments that will not need
to resort to unwinding the market
system to sustain themselves finan-
cially, says Russell Napier, a Lon-
don-based strategist at CLSA, in a re-
cent report. The best place to invest
will be countries with large current-
account surpluses, low government
indebtedness and very sound com-
mercial banks.
Napiers view is that the Feds bal-
ance sheet is so stretched that there
isnt much it can do to prevent de-
flation. Meanwhile, the European
Central Banks position is somewhat
worse. The ECB risks its solvency
every day when it loads up in assets
that could one day be denominated
in a foreign currency, he warns in
his report, referring to the possibili-
ty of Greece or Italy abandoning the
euro. The usual accountancy leger-
demain can value sovereign debt at
face value whatever the market price,
but this is not possible when that
debt is in drachmas or lire.
Where will global capital eventu-
ally head? Napier says the Singapore
dollar might well prove to be the safest
of safe havens over time. In his view,
Singapore offers developed-world in-
vestors positive real returns at a time
when wealth destruction is the norm
and not the exception.
Lorraine Tan, head of research at
Standard and Poors, also believes
that the Singapore dollar could even-
tually be seen as a safe haven. The
move by the Swiss National Bank
[to peg the Swiss franc to the euro
at CHF1.20] has removed the Swiss
franc as a safe haven. So, this leaves
the Australian dollar and Asian cur-
rencies such as the Japanese yen
and Singapore dollar as the alterna-
tives. Of course, the Singapore dol-
lar and the Japanese yen dont offer
the relatively high yields of the Aus-
tralia dollar, she adds. But with in-
vestors looking for defensive alterna-
tives and hedging vehicles, and the
assurance of open markets, they will
still garner interest.
Leong of Barclays Capital is also
looking for a safe haven closer to home.
Further out, its going to be clear that
the US dollar is no haven. So, you go
for the region with the best fundamen-
tals. Asia will resonate quite well with
investors. Meanwhile, Seah of DBS
sees the USD/SGD cross-rate eventu-
ally ending the year at 1.24.
If they are right, the recent crash
in the Singapore dollar might just
turn out to be a passing squall rather
than the start of a destructive storm.
And, that could see sentiment to-
wards risk assets such as stocks im-
prove too.
Crash in Singapore dollar might just be a passing squall
FROM PAGE 29
E
CAPITAL INSIDER MOVES
SEPT 12 AP OIL INTL LTD 371,000 HO CHEE HON 1,433,000 MARRIED DEAL (12/9)
SEPT 19 ASCENDAS REAL ESTATE INV TRUST -293,000 CBRE CLARION SECURITIES LLC 103,928,542 SALES IN OPEN MARKET AT OWN DISCRETION (15/9)
SEPT 19 BH GLOBAL MARINE LTD 70,000 LIM HWEE HONG 3,928,690 286,675,600 OPEN MARKET PURCHASE (15/9)
SEPT 15 C&G ENV PROTEC HLDGS LTD 3,920,000 C&G HLDGS (HONG KONG) LTD 694,991,355 OPEN MARKET PURCHASE (15/9)
SEPT 15 C&G ENV PROTEC HLDGS LTD 3,820,000 C&G HLDGS (HONG KONG) LTD 694,891,000 OPEN MARKET PURCHASE (15/9)
SEPT 19 CACHE LOGISTICS TRUST -4,000 MITSUBISHI UFJ FINANCIAL GROUP INC 31,841,000 OTHERS (15/9)
SEPT 14 CDL HOSPITALITY TRUSTS -549,000 DAIWA ASSET MANAGEMENT CO LTD 47,739,000 SALES IN OPEN MARKET AT OWN DISCRETION (9/9)
SEPT 13 CENTRALAND LTD 500,000 YAN TAO 692,354,000 ACQUISITION (9/9)
SEPT 13 CENTRALAND LTD 4,000 YAN TAO 692,358,000 ACQUISITION (12/9)
SEPT 12 CEREBOS PACIFIC LTD -10,000 LUCIEN WONG YUEN KUAI SALES IN OPEN MARKET AT OWN DISCRETION (9/9)
SEPT 9 CHINA JISHAN HLDGS LTD 553,000 JIN GUAN LIANG 16,649,500 206,650,500 OPEN MARKET PURCHASE (8/9)
SEPT 9 CHINA KANGDA FOOD CO LTD 3,524,000 ZHENSHO CO LTD 43,307,000 OPEN MARKET PURCHASE (9/9)
SEPT 20 CHINA MINZHONG FOOD CORP LTD 200,000 LIN GUO RONG 5,328,000 29,861,297 OPEN MARKET PURCHASE (20/9)
SEPT 14 CHINA NEW TOWN DEVT CO LTD 262,000,000 SHI JIAN 2,658,781,817 OPEN MARKET PURCHASE (14/9)
SEPT 20 CHINA NEW TOWN DEVT CO LTD -278,061,000 OZ MANAGEMENT LP, OCH-ZIFF HOLDING CORP 134,704,037 SALES IN OPEN MARKET AT OWN DISCRETION (19/9)
SEPT 9 CMZ HLDGS LTD 1,420,000 SHAO KESHENG 212,685,374 OPEN MARKET PURCHASE (9/9)
SEPT 12 CMZ HLDGS LTD 367,000 SHAO KESHENG 213,052,374 OPEN MARKET PURCHASE (12/9)
SEPT 19 CMZ HLDGS LTD 1,358,000 SHAO KESHENG 214,581,374 OPEN MARKET PURCHASE (19/9)
SEPT 16 DEBAO PROPERTY DEVELOPMENT LTD 13,538,000 YUAN LE SHENG 13,538,000 605,930,232 OPEN MARKET PURCHASE (15/9)
SEPT 14 ELEC & ELTEK INT CO LTD 1,898,454 KINGBOARD INVESTMENTS LTD 56,400 128,637,765 OTHERS (9/9)
SEPT 19 ELEC & ELTEK INT CO LTD 1,000 CHEUNG KWOK WING 1,001,200 506,000 OPEN MARKET PURCHASE (15/9)
SEPT 13 EU YAN SANG INTL LTD 220,000 ABERDEEN ASSET MGMT ASIA LTD 44,300,400 OPEN MARKET PURCHASE (12/9)
SEPT 14 FAR EAST GROUP LTD 97,000 LOH AH PENG @ LOH EE MING 97,000 42,570,000 OPEN MARKET PURCHASE (14/9)
SEPT 9 FORTUNE REAL ESTATE INV TRUST -422,000 LIM HWEE CHIANG 4,793,980 OTHERS (9/9)
SEPT 9 FU YU CORP LTD 195,000 NG HOCK CHING 829,000 49,783,000 OPEN MARKET PURCHASE (8/9)
SEPT 14 FU YU CORP LTD 157,000 NG HOCK CHING 829,000 49,940,000 OPEN MARKET PURCHASE (14/9)
SEPT 13 GUOCOLAND LTD -2,000,000 QUEK LENG CHAN 3,600,000 SALE OF SHARES (9/9)
SEPT 12 GUOCOLEISURE LTD 79,000 QUEK LENG CHAN 735,000 908,462,434 OPEN MARKET PURCHASE (9/9)
SEPT 9 GUTHRIE GTS LTD 168,000 PUTRA MASAGUNG 550,000 741,642,275 OPEN MARKET PURCHASE (8/9)
SEP 19 HEALTHWAY MEDICAL CORP LTD -9,488,000 JONG HEE SEN 15,905,276 121,890,426 OFF-MARKET SALE (16/9)
SEP 10 HERSING CORP LTD 392,000 KHOO CHIN WAH 17,917,000 30,100,000 OPEN MARKET PURCHASE (8/9)
SEP 13 HOE LEONG CORP LTD 450,000 HOE LEONG CO (PTE) LTD 144,504,200 OPEN MARKET PURCHASE (12/9)
SEP 14 HOTEL GRAND CENTRAL LTD 36,000 TAN ENG HOW 457,273 289,315,427 OPEN MARKET PURCHASE (12/9)
SEP 13 HTL INTL HOLDINGS LTD 80,000 PHUA YONG TAT 3,419,000 194,498,530 OPEN MARKET PURCHASE (13/9)
SEP 14 HTL INTL HOLDINGS LTD 101,000 PHUA YONG PIN 101,000 195,830,530 OPEN MARKET PURCHASE (14/9)
SEP 14 HTL INTL HOLDINGS LTD 100,000 PHUA YONG TAT 3,519,000 194,498,530 OPEN MARKET PURCHASE (14/9)
SEP 16 HU AN CABLE HOLDINGS LTD 967,000 DAI ZHI XIANG 967,000 205,049,000 OPEN MARKET PURCHASE (14/9)
SEP 16 HU AN CABLE HOLDINGS LTD 422,000 DAI ZHI XIANG 1,389,000 205,049,000 OPEN MARKET PURCHASE (15/9)
SEPT 15 JARDINE CYCLE & CARRIAGE LTD 127,000 JARDINE STRATEGIC SINGAPORE PTE LTD 252,594,540 ACQUISITION (15/9)
SEPT 13 KS ENERGY LTD -6,093,750 PACIFIC ONE ENERGY LTD 21,406,250 OTHERS (12/9)
SEPT 9 KTL GLOBAL LTD 1,000,000 TAN TOCK HAN 2,000,000 92,127,000 OPEN MARKET PURCHASE (8/9)
SEPT 9 KTL GLOBAL LTD 1,382,000 TAN TOCK HAN 3,382,000 92,127,000 OPEN MARKET PURCHASE (9/9)
SEPT 13 KTL GLOBAL LTD 327,000 TAN TOCK HAN 3,709,000 92,127,000 OPEN MARKET PURCHASE (13/9)
SEPT 13 LAFE CORP LTD 502,000 CLARENDON INVESTMENTS CAPITAL LTD 629,090,079 OPEN MARKET PURCHASE (9/9)
SEPT 16 LAFE CORP LTD 848,000 CLARENDON INVESTMENTS CAPITAL LTD 629,938,079 OPEN MARKET PURCHASE (14/9)
SEPT 13 LEE KIM TAH HLDGS LTD 179,000 LEE KIM TAH INVESTMENTS PTE LTD 332,965,405 OPEN MARKET PURCHASE (12/9)
SEPT 13 LORENZO INTL LTD 100,000 GOH AH LEE 12,246,000 OPEN MARKET PURCHASE (13/9)
SEPT 13 METRO HLDGS LTD 167,000 NGEE ANN KONGSI 75,804,056 OPEN MARKET PURCHASE (12/9)
The information in Insider Moves is provided as a service to readers. The explanations led are at times abridged, indirect interest dec larations summarised together with direct interests and gures totalled for space. While every effort is made to ensure accuracy, the information presented
is not the ofcial record of shareholder lings. Readers who are interested should check the original lings led with the SGX.
FILING COMPANY SHARES ACQUIRED DIRECTOR/SUBSTANTIAL SHARES HELD AFTER CHANGE REASON
DATE (DISPOSED) SHAREHOLDER DIRECT DEEMED
Billionaire Quek Leng Chan raises
deemed stake in GuocoLeisure
E
| BY AMY TAN |
M
alaysian billionaire Quek
Leng Chan, exe cutive
chairman of Guoco-
Leisure, bought 519,000
shares through Guoco-
Leisure Assets Ltd, a unit of his Guoco
Group, at 60 cents each on the open
market in a series of transactions from
Sept 9 to 14. The purchases increased
his deemed interest from 66.40% to
66.44%. His direct interest remains
at 735,000 shares, or 0.05%.
Hotel and resorts operator Guoco-
Leisure reported net profit for FY end-
ed June 30, rose 61.2% to US$79.8
million ($102 million) from US$49.5
million in the previous year, owing
mainly to better performances in both
its hotel and gaming operations. Rev-
enue rose 18.1% to US$391.1 million.
Profit from hotels before financing
costs rose to US$61.2 million from
US$46.7 million, reflecting improved
average room rates. The hotels, oper-
ating under the Guoman and Thistle
brands, are predominantly based in
the UK, but the group is expanding
in Malaysia and China.
According to Bloomberg data,
Quek recently emerged as one of the
top shareholders in American Airlines
Incs parent company, AMR Corp.
According to the US Securities and
Exchange Commission, Quek and a
group of affiliated entities acquired
24.4 million out of 335.2 million AMR
Corp common shares in August. This
gave Quek control of a 7.3% stake in
AMR Corp, the fourth-largest stake in
the company at press time.
Elsewhere, Ben Chng Beng Beng,
group managing director and deputy
chairman of Viz Branz, purchased
150,000 shares at 25.5 cents each in
a series of transactions from Sept 7
to 16, increasing his direct interest in
the company from 50.11% to 50.15%.
For the full-year ended June 30, Viz
Branz, manufacturer and distributor
of instant beverages, reported a net
profit of $11.49 million on the back
of $165.67 million in revenue. A year
ago, net profit was $13.77 million on
revenue of $152.75 million.
Meanwhile, Dai Zhi Xiang, execu-
tive chairman of the board and CEO
of Hu An Cable Holdings, is building
up his direct interest in the company.
He bought 967,000 shares on the open
market at 25.24 cents apiece on Sept
14. The following day, he picked up
422,000 shares at 25.12 cents. The pur-
chases increased Dais direct interest
to 0.16%, or 1.39 million shares. His
deemed interest remains at 23.80%,
or 205 million shares.
For the quarter ended June 30,
the wire and cable manufacturer
from China reported revenues of
RMB826.7 million ($166.6 million),
against RMB707.33 million a year ago.
Profit attributable to equity holders of
the company was RMB29.59 million,
or 4.5 cents diluted per share, against
RMB36.45 million, or 6.5 cents dilut-
ed per share a year ago.
Sept 26, 2008 Sept 22, 2011
Viz Branz
0
2000
4000
6000
8000
10000
12000
14000
16000
0.10
0.15
0.2
0.255
0.3
0.35
B
L
O
O
M
B
E
R
G
Market
capitalisation Aug 31, 2011 $302.47 mil
52-week high Nov 11, 2011 33 cents
52-week low Aug 22, 2011 24.5 cents
PER 7.73 times
Gross dividend yield 4.9%
Net prot FY2011 ended

June $11.48 mil
Net prot FY2010 ended

June $13.77 mil
Sept 26, 2008 Sept 22, 2011
GuocoLeisure
0
50000
100000
150000
200000
250000
0.2
0.3
0.4
0.5
0.6
0.7
0.8
B
L
O
O
M
B
E
R
G
Market
capitalisation Aug 31, 2011 $820.84 mil
52-week high March 9, 2011 81 cents
52-week low Sept 1, 2010 54.5 cents
PER 7.7 times
Gross dividend yield 3.33%
Net loss FY2011 ended
June $79.8 mil
Net loss FY2010 ended

June $49.5 mil
CAPITAL INSIDER MOVES
SEPT 16 METRO HLDGS LTD 1,802,000 NGEE ANN KONGSI 78,835,056 OPEN MARKET PURCHASE (15/9)
SEPT 9 NAM CHEONG LTD 20,000 DATUK TIONG SU KOUK 240,446,832 894,317,685 PURCHASE (8/9)
SEPT 15 NAM LEE PRESSED METAL INDS LTD 20,000 YONG KIN SEN 1,139,250 132,379,303 OPEN MARKET PURCHASE (14/9)
SEPT 9 OSIM INTL LTD 496,000 RON SIM CHYE HOCK 317,485,815 191,777,719 OPEN MARKET PURCHASE (9/9)
SEPT 14 OTTO MARINE LTD 140,000 YAW CHEE SIEW 3,789,000 1,198,211,000 OPEN MARKET PURCHASE (14/9)
SEPT 13 OVERSEAS UNION ENTERPRISE LTD 934,000 JP MORGAN ASSET MGMT (S) LTD 49,670,000 PURCHASE OF SHARES (9/9)
SEPT 8 OXLEY HLDGS LTD 180,000 CHING CHIAT KWONG 589,495,000 OPEN MARKET PURCHASE (6/9)
SEPT 9 OXLEY HLDGS LTD 100,000 TEE WEE SIEN (ZHENG WEIXIAN) 175,910,000 OPEN MARKET PURCHASE (8/9)
SEPT 19 OXLEY HLDGS LTD 100,000 TEE WEE SIEN (ZHENG WEIXIAN) 182,965,800 OPEN MARKET PURCHASE (16/9)
SEPT 13 MOYA ASIA LTD 19,491,000 MOYA HOLDING CO BSC 347,202,627 OFF MARKET PURCHASE (12/9)
SEPT 9 PERENNIAL CHINA RETAIL TRUST 238,000 PUA SECK GUAN 238,000 41,466,002 OPEN MARKET PURCHASE (7/9)
SEPT 9 PERENNIAL CHINA RETAIL TRUST 262,000 PUA SECK GUAN 500,000 41,466,002 OPEN MARKET PURCHASE (8/9)
SEPT 14 PERENNIAL CHINA RETAIL TRUST 500,000 KUOK KHOON HONG 41,999,000 OPEN MARKET PURCHASE (12/9)
SEPT 14 PERENNIAL CHINA RETAIL TRUST 649,000 KUOK KHOON HONG 42,648,000 OPEN MARKET PURCHASE (13/9)
SEPT 9 PERTAMA HLDGS LTD 20,000 HARVEY NORMAN SINGAPORE PTE LTD 70,956,000 120,051,350 OPEN MARKET PURCHASE (9/9)
SEPT 13 PERTAMA HLDGS LTD -1,932,000 KAY LESLEY HARVEY 196,964,350 SALES IN OPEN MARKET AT OWN DISCRETION (13/9)
SEPT 13 PERTAMA HLDGS LTD 5,679,000 HARVEY NORMAN SINGAPORE PTE LTD 76,913,000 120,051,350 OPEN MARKET PURCHASE (13/9)
SEPT 20 PERTAMA HLDGS LTD 2,336,000 HARVEY NORMAN SINGAPORE PTE LTD 79,610,000 120,051,350 OPEN MARKET PURCHASE (19/9)
SEPT 12 POH TIONG CHOON LOGISTICS LTD 17,000 POH CHOON ANN (PTE) LTD 48,000,000 2,517,000 OPEN MARKET PURCHASE (8/9)
SEPT 9 PTERIS GLOBAL LTD 150,000 WINMARK INVESTMENTS PTE LTD 46,585,000 OPEN MARKET PURCHASE (8/9)
SEPT 14 PTERIS GLOBAL LTD 100,000 WINMARK INVESTMENTS PTE LTD 46,685,000 OPEN MARKET PURCHASE (13/9)
SEPT 13 SINGAPORE PRESS HLDGS LTD 10,000 CHAM TAO SOON 20,000 10,183 OPEN MARKET PURCHASE (13/9)
SEPT 15 SIN GHEE HUAT CORP LTD 275,000 KUA ENG WATT 560,000 56,700,000 OPEN MARKET PURCHASE (15/9)
SEPT 13 SINGXPRESS LAND LTD 500,000 CHAN HENG FAI 233,688,000 OPEN MARKET PURCHASE (13/9)
SEPT 16 SINOPIPE HLDGS LTD 693,000 TRIUMPUS CAPITAL LTD 20,819,000 OPEN MARKET PURCHASE (14/9)
SEPT 16 SINOPIPE HLDGS LTD 463,000 TRIUMPUS CAPITAL LTD 21,282,000 OPEN MARKET PURCHASE (15/9)
SEPT 14 SITRA HLDGS (INTL) LTD 25,000 GEORGE CHEW AH BA 48,971,284 35,449,716 OPEN MARKET PURCHASE (13/9)
SEPT 19 TECKWAH INDUSTRIAL CORP LTD 2,050,000 AIRJET AUTO-CARE PTE LTD 25,700,000 OPEN MARKET PURCHASE (16/9)
SEPT 14 THAI BEVERAGE PUBLIC CO LTD 5,813,000 MAXTOP MANAGEMENT CORP 4,259,187,762 OPEN MARKET PURCHASE (13/9)
SEPT 16 THAI BEVERAGE PUBLIC CO LTD 2,000,000 MAXTOP MANAGEMENT CORP 4,261,187,762 OPEN MARKET PURCHASE (15/9)
SEPT 9 UNITED INDUSTRIAL CORP LTD 85,000 WEE CHO YAW 24,000 658,669,565 OPEN MARKET PURCHASE (8/9)
SEPT 12 VALUETRONICS HLDGS LTD 2,140,000 POPULUS FUND 20,808,000 BOUGHT (18/8)
SEPT 9 VIZ BRANZ LTD 60,000 BEN CHNG BENG BENG 178,527,144 OPEN MARKET PURCHASE (7/9)
SEPT 9 YANGZIJIANG SHIPBLDG HLDGS LTD 116,332,000 REN YUANLIN 2,200,000 1,000,000,000 OTHERS (9/9)
SEPT 9 YANGZIJIANG SHIPBLDG HLDGS LTD -48,180,000 HONG KONG HENGYUAN INVESTMENT LTD 317,755,100 OTHERS (9/9)
SEPT 19 Z-OBEE HLDGS LTD -21,730,000 WANG TAO 37,364,000 OTHERS (15/9)
FILING COMPANY SHARES ACQUIRED DIRECTOR/SUBSTANTIAL SHARES HELD AFTER CHANGE REASON
DATE (DISPOSED) SHAREHOLDER DIRECT DEEMED
SEP 14 JEP HLDGS LTD 87,000 0.029 0.026 18,058,000
SEP 14 KSH HLDGS LTD 245,000 0.220 0.220 1,011,000
SEP 16 LUM CHANG HLDGS LTD 630,000 0.279 0.279 630,000
SEP 19 LUM CHANG HLDGS LTD 236,000 0.284 0.284 866,000
SEP 16 OSIM INTL LTD 45,000 1.145 1.145 43,188,000
SEP 19 OSIM INTL LTD 494,000 1.150 1.150 43,682,000
SEP 20 OSIM INTL LTD 470,000 1.160 1.160 44,152,000
SEP 14 OVERSEA-CHINESE BANKING CORP 70,000 8.180 8.180 3,228,789
SEP 14 SARIN TECHNOLOGIES LTD 130,000 0.825 0.820 1,133,000
SEP 14 SINGAPORE AIRLINES LTD 563,000 10.950 10.800 5,493,380
SEP 19 STRACO CORP LTD 319,000 0.160 0.160 4,599,000
SEP 20 STRACO CORP LTD 387,000 0.160 0.160 4,986,000
SEP 19 SUNVIC CHEMICAL HLDGS LTD 888,000 0.599 0.599 11,583,000
Share buybacks
DATE COMPANY SHARES ACQUIRED SHARE PRICE CUMULATIVE
HIGH LOW NET OUTSTANDING
TREASURY SHARES
DATE COMPANY SHARES ACQUIRED SHARE PRICE CUMULATIVE
HIGH LOW NET OUTSTANDING
TREASURY SHARES
SEP 14 AZTECH GROUP LTD 130,000 0.113 0.108 23,069,000
SEP 19 CAPITALAND LTD 3,000,000 2.560 2.540 4,788,000
SEP 20 CAPITALAND LTD 2,756,000 2.590 2.530 7,544,000
SEP 15 CDW HOLDING LTD 100,000 0.084 0.084 16,244,000
SEP 16 CDW HOLDING LTD 630,000 0.084 0.084 16,874,000
SEP 14 CHEUNG WOH TECHNOLOGIES LTD 200,000 0.180 0.180 614,000
SEP 19 CHEUNG WOH TECHNOLOGIES LTD 179,000 0.180 0.180 793,000
SEP 16 CHINA TAISAN TECH GRP HLDGS LTD 1,000,000 0.114 0.114 2,000,000
SEP 14 DBS GROUP HLDGS LTD 300,000 12.180 12.030 7,056,000
SEP 14 FOOD JUNCTION HLDGS LTD 120,000 0.200 0.200 3,122,000
SEP 14 FREIGHT LINKS EXPRESS HLDGS 500,000 0.055 0.055 3,292,000
SEP 15 GLOBAL TESTING CORP LTD 560,000 0.052 0.052 22,283,000
SEP 20 GLOBAL TESTING CORP LTD 250,000 0.054 0.053 22,533,000
SEP 14 HO BEE INVESTMENT LTD 688,000 1.355 1.345 21,583,000
SEP 16 INNOTEK LTD 41,000 0.370 0.370 20,752,000
ad.indd 1 9/22/11 11:33 PM
CAPITAL BROKERS DIGEST
CapitaMalls Asia (Sept 21: $1.275)
BUY. CMAs current valuation of its Luwan project (total
estimated cost RMB30,275 psm) and Raffles City Beijing
(RMB25,974 psm) appears conservative compared with
Shui On Lands acquisition of an 80% stake in Shui On
Plaza for RMB47,071 psm and Hongkong Lands acquisition
of the Wangfujing commercial site for RMB22,121 psm.
We cut our earnings forecast by an average of 20.7%
to chiefly reflect (1) the latest completion schedule of
CMAs malls in China and Singapore; (2) higher pre-op
expenses; (3) the acquisition of additional stakes in
the Shanghai malls; and (4) our revised earnings for
CMT. We ascribe a 30% discount to our GAV estimate
(ex-listed entities) to reflect longer asset maturity in
China, resulting in a cut in price target to $1.69 (from
$2.23), which implies a FY2012F P/B of 1. Nomura
Research (Sept 19)
CWT (Sept 21: $1.03)
MAINTAIN BUY. CWT announced the acquisition of a
50% stake in Unimar Logistics Incorporation, a service
provider of less-than-container load (LCL) and full-container
load (FCL) cargo in Turkey, for US$8.75 million. The
acquisition would not have a material impact on FY2011
earnings and would be funded by cash and borrowings.
We are positive on the acquisition as it would allow CWT
to enlarge and enhance its LCL service coverage to its
global customers and tap the Turkish and neighbouring
markets that have strong growth potential. On the back
of CWTs continued investments in its core business,
we maintain our buy recommendation and target of
$1.73. DMG & Partners Securities (Sept 19)
DBS Group (Sept 21: $12.36)
DOWNGRADE TO UNDERPERFORM. We downgrade
DBS after cutting our FY2011-2013 estimates by about
7%. This is mainly because of non-interest income and
credit costs. Our price target follows a lowered ROE of
$11.90 from $16.56, now based on 1.0x CY2011 P/BV
(GGM, ROE 10.3%, COE 10%, growth 4.3%). We are wary
of the new credit cycle and DBSs exposure to Chinas
export sector. We also reckon that DBS has the most
room for top-line slippages, as capital-market activities
slow and interest rates stay low, providing de-rating
catalysts. Lastly, while its 1.0x CY2011 P/BV valuation
is not lofty, experience with recessions in the last 15
years tells us that valuation multiples can over-shoot
on the downside, when recession triggers are set off.
CIMB Research (Sept 21)
Frasers Centrepoint Trust (Sept 21: $1.46)
MAINTAIN OUTPERFORM. We visited FCTs Causeway
Point and newly acquired Bedok Point recently. We see
the refurbishment of Causeway Point, FCTs largest asset,
as a potential game-changer for FCT. With funding details
concluded, we factor in the acquisition of Bedok Point
and raise our FY2012-2013 distribution per unit (DPU)
estimates by less than 1%. Our dividend discount model
(DDM)-based target price is, however, unchanged at $1.63
(discount rate 8.4%). We continue to like FCTs exposure
to resilient suburban retail assets and strong balance
sheet (34% after acquisition), anticipating catalysts
from stronger-than-expected rentals for Causeway Point
after its refurbishment and improved stock liquidity.
CIMB Research (Sept 20)
M1 (Sept 21: $2.51)
MAINTAIN NEUTRAL. We view negatively M1s decision
to end its partnership with Vodafone from Dec 31 as
this may shave M1s core net profit by 5% to 10%,
based on our estimates. M1 has a roaming partnership
with Vodafone whereby users of Vodafone or Vodafone
partners roam on M1s network in Singapore. We also
gather from the industry that Vodafone provides mobile
telephony for MNCs through M1. We maintain our neutral
rating on M1, although there are risks to our forecasts
and DCF-based price target of $2.63 (weighted average
cost of capital 8.5%) as a result of the cessation of the
partnership. M1s share price should be supported by
its fairly attractive dividend yield of 6% to 7%. CIMB
Research (Sept 20).
PEC (Sept 21: 80.5 cents)
MAINTAIN BUY. PEC announced recently that it has
secured a tankage maintenance and repair services contract
in Singapore. The contract is effective for five years
beginning September 2011 and involves ExxonMobils
Jurong Refinery, Pulau Ayer Chawan Refinery and
Singapore Chemical Plant. As at end-FY2011, the group
had $158 million of net cash against $210 million of
equity. Investors may be concerned about the groups
acquisition strategy as the group has been holding on to
a large amount of cash over the past two years. Given its
balance-sheet strength, we believe PEC can well afford
acquisitions with a size north of $100 million. We raised
our FY2012 maintenance revenue by 5% for the recent
contract win, but our FY2012 EPS remains unchanged
after rounding. Fair value estimate of $1.12. OCBC
Investment Research (Sept 20).
Q&M Dental Group (S) (Sept 21: 76 cents)
MAINTAIN INCREASE EXPOSURE. On the Singapore
front, the company expects more Singaporean patients to
visit its clinics as the Primary Care Partnership Scheme
(PCPS) reaches out to more than 700,000 people. The
entity is also considering growing organically via the
setting up of its own clinics in one of the Chinese cities
this may help to boost profitability further but we have
yet to include it into our valuation. Q&M also intends
to expand its operations in Malaysia, albeit at a much
slower pace as China will continue to be their priority.
We like Q&M for its defensive nature and steady business
model. The companys share price demonstrated that
by falling only 3.7% since June 1, as compared with
the STIs 13.3% drop. Intrinsic value of $1. SIAS
Research (Sept 16)
Roxy Pacic Holdings (Sept 21: 41 cents)
UPGRADE TO BUY. At the current market cap of $248
million, Roxy Pacific Holdings is trading at less than the
independent valuation of its hotel asset alone (Grand
Mercure Roxy Hotel, or GMRH), which is $329 million
or $590,000 per room a fair valuation in the current
hospitality market, in our view. Excluding GMRH, there
is still an additional net equity of $115 million on its
balance sheet. Moreover, we see little chance of a liquidity
crisis, even in a bear scenario, as approximately 56% of
its debt is secured on sold-out projects and the remaining
on land sites. Despite recent macro uncertainties, we
expect Roxy to launch three more projects in 4Q2011.
Fair value estimate of 48 cents (30% discount to RNAV).
OCBC Investment Research (Sept 20)
Global Logistic Properties (Sept 21: $1.745)
OUTPERFORM (initiating coverage). GLP is the leading
provider of logistic assets in China and Japan where
underlying demand is underpinned by surging domestic
consumption. It is set to enjoy 14% core earnings CAGR
by 2015 on the back of rising demand for logistic assets.
Booming online-retail sales in China and the outsourcing
trend in Japan are key drivers for logistic space demand.
Furthermore, a low gearing and potential monetisation
of its Japan portfolio are key enablers to fund its China
growth ambitions of 1.66 million sq m in FY2012 and
two million sq m per annum going forward. Our price
target of $2 per share is a blended average of FY2012/13
RNAV. CLSA Research (Sept 14)
Golden Agri-Resources (Sept 21: 69 cents)
TRADING BUY. We are positive but not surprised that
PT SMART has received RSPO certification for 14,955ha
of estates and one mill. Efforts put in place by the
group to regain its reputation as a sustainable producer
appear to have gained traction. This is a second positive
boost to the groups efforts. Last Thursday, it announced
that Nestl has resumed palm-oil purchases from PT
SMART. We believe these developments will help raise
the groups reputation as a sustainable producer among
its customers and investors over time. We are keeping
unchanged our earnings forecast, as well as price target
of 81 cents (based on forward PER of 12.5x). Price
target of 60 cents. These latest developments, together
with potential M&A possibilities and higher production,
are rerating catalysts for the stock. CIMB Research
(Sept 19)
Hutchison Port Holdings Trust
(Sept 21: 64.5 US cents)
MAINTAIN BUY. Yantian Ports throughput volumes
fell 6.9% y-o-y in August. In view of the weaker peak
season, and ongoing economic uncertainties, we thus cut
our volume-growth assumptions at Yantian to 2% and
4% for FY2011 and FY2012. We also lower our growth
assumptions at Hongkong International Terminals by 1ppt,
and flatten our tariff-growth assumptions, resulting in
4.5%/6.5% decline in FY2011/2012 DPU projections, to
5.7 US cents (annualised) and 6.0 US cents respectively.
Even with our lower DPU projections, HPHT is still
trading at attractive 8.5% to 9.0% yields. We reckon
current the share price is pricing in a DPU (and by
extension, Ebitda) decline of close to 22% in FY2012.
Compare this with 2009 when global container trade
contracted by an exceptional 9% and Ebitda had
declined by only 17%. Price target cut to 95 US cents.
DBS Vickers Securities (Sept 19)
Lian Beng Group (Sept 21: 37 cents)
MAINTAIN BUY. LBG announced that it would be listing
two of its subsidiaries on the Taiwan Stock Exchange.
If shareholders approval is obtained during the EGM,
we estimate the listing to take place six to nine months
from now. With $149.9 million cash on hand (excluding
the potential IPO proceeds), LBG is well positioned to
accumulate land bank for property development. On the
back of a strong order book of $839 million (as at May
11) and a good track record of project wins, we estimate
LBGs FY2012 earnings to come in at $53.5 million, which
suggests a prospective PER of 3.4x. Trading at a mere
3.4x prospective PER, we believe it has the capacity to
trade up to the sector average of 7x for a rice target of
71 cents. DMG & Partners Securities (Sept 20)
CAPITAL BROKERS DIGEST
q-o-q Quarter-on-quarter
y-o-y Year-on-year
DCF Discounted cash ow
Ebitda Earnings before interest, tax, depreciation
and amortisation
EPS Earnings per share
FY Financial year
NAV Net asset value
NTA Net tangible assets
P/BV Price-to-book value
PEG Price earnings to growth
PER Price-to-earnings ratio
ROE Return on equity
Every week, The Edge Singapore brings you digested excerpts of research reports of Singapore
Exchange-listed companies available in the public domain or received from brokers. Investors
interested in research on companies are also encouraged to register for free access to reports from
stockbrokers that participate in the SGX-Monetary Authority of Singapore Research Incentive Scheme
(www.research.sgx.com).
Disclaimer: The Edge Publishing Pte Ltd does not accept any liability whatsoever for any direct, indirect
or consequential losses (including loss of prot) or damages that may arise from the use of information or
opinions in this publication. The information and opinions in this publication are not to be considered as an
offer to sell or buy any of the securities discussed. Opinions expressed are subject to change without notice.
The brokers may, from time to time, have interests or positions in the securities mentioned. The Edge Singapore
welcomes brokers submitting their reports for investor information to theedgespore@bizedge.com.
| COMPILED BY RAHAYU MOHAMAD |
E
Singapore Post (Sept 21: $1.055)
UPGRADE TO BUY. SingPost has demonstrated
earnings resilience in the face of structural
changes in the global mail industry. Its efforts
to diversify into the non-mail business since
its listing in 2003 have paid off, with the
segment contributing 31% to operating profit
in FY March 2011 from 15% in FY March
2005. Year to date, SingPosts share price has
retreated by 11% versus the STIs decline of
13%. At 12x FY March 2012F PER, the stock
is trading at one standard deviation below
its PER mean, which we think represents
a good entry level. Price target of $1.18,
based on 14x FY March 2012F earnings.
Including dividends, this gives an expected
total return of 19%. Kim Eng Research
(Sept 20)
STX OSV (Sept 14: $1.21)
MAINTAIN OUTPERFORM. STX OSVs share
price has fallen sharply on concerns that
tightening credit could slow down its order
intake. We were the first to downgrade the
offshore and marine sector based on the same
fears. We now reduce our earnings estimates
for STX OSV for FY2012-2013 by 2% to 10%
as we scale back order expectations by 20%
to 23%. Our price target dips accordingly to
$1.85 (from $1.89), still based on 11x CY2012
PER (five-year mean for small to mid-cap
industrials). Notwithstanding this, we maintain
our outperform rating, believing in minimal
cancellation risks for its quality order book
and buffer to withstand a downturn. We
continue to anticipate catalysts from strong
quarterly results, 8% dividend yields and
continued good project execution. CIMB
Research (Sept 19)
Trek 2000 International
(Sept 19: 31 cents)
MAINTAIN BUY. Through the introduction
of the software development kit, Trek seeks
to repeat the success of Apples iPhone,
which is to leverage on the creativity of
the public. Powerful hardware inventions
require innovative software complement in
order to prevail. We understand from the
management that they will be rewarding the
apps creator with a fixed upfront amount
and then split the revenue every time the
software is sold over the Internet. Our previous
report had not factored in the contribution
of the software. But we are leaving our
earnings estimates untouched for now as
we seek more clarity on its hardware sales,
which is expected to be unveiled in 3Q2011.
Price target of 45 cents. DMG & Partners
Securities (Sept 20)
United Overseas Bank (Sept 21: $17.75)
MAINTAIN NEUTRAL. We appraise UOB as
being the best-managed of the three banks
for liquidity risks. Its capital buffers are also
the highest among the trio. Such dynamics
means that investors associate UOB with
defensiveness; UOBs YTD outperformance
could be attributed to this, we believe. We
do not disagree that UOB is the comfort
stock in the Singapore banking space; yet, if
a banking crisis erupts, all financial stocks
could underperform. We recently turned
cautious on Singapore banks, on signs of
liquidity strains in the world. We make no
changes to our earnings estimates for now
as our NPL assumptions (2.1% by 2013)
have partially factored in a credit cycle.
Our price target remains $20.38 (1.5x P/BV,
GGM). CIMB Research (Sept 16)
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ad.indd 1 9/22/11 6:55 PM
Stocks slump on gloomy Fed,
China PMI
Sept 22: Stocks tumbled and the US dollar surged
on Thursday after a warning from the US Fed-
eral Reserve that the US faced a grim economic
outlook with signicant downside risks and
further evidence of a slowdown in China.
European stock index futures fell more than
2.5% after a slump of more than 4% on Asian
exchanges, while commodities and emerging
market currencies dived in a broad sell-off of
riskier assets.
Global miners and Asias big exporters were
hit hard, with Rio Tinto falling 6.2% and Honda
Motor shedding 3.9%.
It is hard to ignore the macroeconomic
picture, said Tony Nunan, a risk manager with
Tokyo-based Mitsubishi Corp.
The US dollar jumped to a seven-month high
on the prospect of higher short-term interest rates
after the Fed said it would sell US$400 billion
($523 billion) worth of short-term Treasury bonds
to buy longer-dated debt.
The widely predicted Fed move, known as
Operation Twist, aims to stimulate the economy
by forcing down long-term borrowing costs.
But it was the central banks bleak assessment
of the worlds biggest economy that preoccupied
markets, with some investors also disappointed
that there were no bolder stimulus moves, given
the extent of the Feds pessimism.
The US dollars strength and the risk aver-
sion that we have seen in recent weeks have
picked up steam after the Fed, as investors came
to terms with the fact they cant pin their hopes
on the bank to help the economy, said Tohru
Sasaki, head of Japan rates and FX research at
JPMorgan Chase.
Euro STOXX 50 index futures fell 2.7%. Fu-
tures for Germanys DAX and Frances CAC-40
were down more than 2.5%, while nancial
spreadbetters in London called the FTSE 100 to
open down as much as 2.7%
Japans Nikkei fell 2.1% and MSCIs broad-
est index of Asia-Pacic shares outside Japan
slumped 4.3%, near the intraday low.
Earlier, it touched a 14-month trough as capital
outows hammered emerging market strongholds
such as Hong Kong and Indonesia.
Selling accelerated on Asian stock markets
after HSBCs China Flash PMI showed the factory
sector shrank for a third consecutive month in
September, pointing to a slowdown in the worlds
second-largest economy.
The data suggested that China, the engine
room of global growth in recent years, may not
be able to provide much of a counterweight to
agging US and European growth.
The twin fears of US recession and a banking
crisis brought on by Europes sovereign debt woes
have haunted equity markets, fuelling a sharp
sell-off in early August and renewed weakness
this month.
Emerging Asian equities have underperformed
US stocks since the August falls, with the MSCI
Asia ex-Japan index now nearly 25% below its
2011 high in April and Wall Streets Standard &
Poors 500 down 15% from its peak in May.
Operation Twist is the latest in a series of
steps aimed at reviving an economy that has
struggled to rebound from the 2008 nancial
crisis.
Investors worry, however, that the Feds lat-
est plan will have little effect on lending in an
economy that appears to be stagnating, which
the Fed also noted. By Alex Richardson
Reuters Support: (1 800) 776 7188
Dealing Code HELP | Customer zone: www.reuters.com/customers | Product info: www.reuters.com/productinfo
Gold weakens on US dollar rally
after Fed decision
Sept 22: Spot gold slipped on Thursday under
the weight of a rallying US dollar, after falling
more than 1% in the previous session when
the US Federal Reserve announced its plan
to load up long-term securities and offered
a grim economic outlook.
Warning of signicant downside eco-
nomic risks, the US central bank said it
would launch a US$400 billion ($523 bil-
lion) programme to shift its US$2.85 tril-
lion balance sheet more heavily towards
longer-term debt.
The decision disappointed investors who
had hoped for stronger stimulus measures,
prompting a slide in stocks and commod-
ity prices.
The worries about the eurozones debt
crisis continue to support the safe-haven
appeal of gold, but momentum is lacking
for bullion to march towards its record high
above US$1,900.
For the short term, gold is likely to remain
in the range of US$1,750 to US$1,850, said
Ong Yi Ling, an analyst at Phillip Futures.
If we do see US$1,700, that could cause a
greater correction to US$1,500.
Spot gold lost 0.3% to US$1,775.40 an
ounce by 0609 GMT, extending a 1.2%
decline in the previous session.
The most active US gold futures contract
fell as much as 2% to US$1,772.5, before
recovering to US$1,778.20.
Technical indicators bode ill for gold
prices. Spot gold prices could fall towards
US$1,730 during the day, said Reuters market
analyst Wang Tao.
The US dollar index rose to a seven-month
high as investors piled into the greenback,
lured by the appeal of short-term rates on
US bonds after the Fed announcement.
A pricier US dollar makes commodities
denominated in the greenback more expensive
to buy for holders of other currencies.
Investors are buying the US dollar and
COMMODITIES
GLOBAL MARKETS
CREDIT DEFAULT SWAPS
Fed triggers sharply wider open
Sept 22: European credit markets are opening in a distinctly
soggy manner, fully reversing the tentative gains of the last
couple of days and more. As at 06.45 GMT, according to
Tradeweb, the iTraxx Main index was 13 basis points wider
at 198bps, the HiVol index was 20bps wider at 276bps and
the Crossover index was a massive 46bps wider at 843bps.
As was widely predicted, the US Federal Reserve relaunched
Operation Twist after a 50-year break at its two-day meeting
yesterday. The Fed will sell US$400 billion ($523 billion) worth
of Treasury bonds with a three-year maturity and reinvest the
proceeds in Treasuries with a six- to 30-year maturity band.
The central bank will also take the proceeds from maturing
MBS and reinvest them in other mortgage-backed securities.
The FOMC statement said the Fed was taking these measures
because the US continued to face a grim economic outlook with
signicant downside risks. That, along with the perception
that Operation Twist will only paper over the macroeconomic
cracks, was enough to send equities into a downward spiral,
resulting in the credit meltdown seen this morning.
Talking of papering over cracks, the Greek cabinet
agreed on another set of austerity measures to ensure the
smooth transition of the Troikas funds into its coffers last
night. Those new measures include cutting high pensions
by 20%, putting 30,000 civil servants on temporary suspen-
sion from their jobs, a lower income tax threshold and an
extension of real-estate tax.
Rates as at Sept 22 (%)
DEPOSIT RATE GOV BOND
1M 3M 6M 1Y 10Y
AUD 4.580 5.520 5.470 5.520 4.035
CNY 3.100 3.300 3.500 3.950
HKD 0.010 0.210 0.150 0.490 1.473
IDR 86.349 34.032 19.578 12.936 7.660
INR 3.410 5.958 4.870 5.102 8.319
JPY 0.290 0.620 0.880 1.160 0.983
MYR 3.640 2.889 2.334 2.410 3.715
NZD 2.540 3.200 2.830 3.310 4.360
PHP 7.809 3.537 2.509 2.126 6.275
THB 3.723 3.245 3.038 3.304 3.890
TWD -1.389 -1.132 -0.918 -0.780 1.330
USD 0.080 0.300 0.680 1.030 1.805
Most actively traded CDS
in basis points (Sept 22)
NAME LAST CCY TERM RANK CLOSE
Wells Fargo 130 USD CDSSN SNRFOR 130
Mexico 183 USD CDSSN SNRFOR 194
Capital One Fncl 0 USD CDSSN SNRFOR 129
Turkey 300 USD CDSSN SNRFOR 265
Russian Fedrtn 260 USD CDSSN SNRFOR 237
UBS AG 225 EUR CDSSN SNRFOR 225
Brazil 187 USD CDSSN SNRFOR 194
Electrolux 90 EUR CDSSN SNRFOR 100
Gazprom 370 USD CDSSN SNRFOR 315
E
E
selling gold, said Ronald Leung, a dealer
at Lee Cheong Gold Dealers in Hong Kong.
But, the physical supply is a bit tight, as
Asian buyers stock up on physical gold.
Investors are shifting their attention to
the Group of 20 talks, due to take place in
Washington on Thursday and Friday, where
Europe will be under heavy pressure to stem
its deepening debt crisis.
Other precious metals also weakened
amid a commoditywide slide. Spot palladium
dropped to a 10-month low of US$680.15,
tracking a price drop in gold as well as in-
dustrial metals. Spot platinum dipped to a
six-week low US$1,740.55, before recovering
to US$1,747.24. By Rujun Shen
E
Precious-metals prices (Sept 22)
METAL LAST CHANGE PCT CHG YTD PCT CHG TURNOVER
SPOT GOLD 1775.40 -5.89 -0.33 25.08
SPOT SILVER 39.42 -0.18 -0.45 27.74
SPOT PLATINUM 1747.24 -9.21 -0.52 -1.15
SPOT PALLADIUM 684.72 -1.68 -0.24 -14.36
TOCOM GOLD 4387.00 -61.00 -1.37 17.65 64540
TOCOM PLATINUM 4343.00 -64.00 -1.45 -7.52 10578
TOCOM SILVER 96.70 -1.10 -1.12 19.38 986
TOCOM PALLADIUM 1708.00 -79.00 -4.42 -18.55 755
COMEX GOLD DEC1 1778.20 -29.90 -1.65 25.10 26184
COMEX SILVER DEC1 39.49 -0.98 -2.43 27.62 4751
EURO/DOLLAR 1.3548
DOLLAR/YEN 76.73
Daily Thomson Reuters Jefferies CRB Commodity
Index with 50- & 100-day moving average
TOCOM prices in yen per gram. Spot prices in US$ per ounce.
COMEX gold and silver contracts show the most active months
Performance of SGD against Asian currencies (Sept 22, 2010 to Sept 22, 2011)
%
SGDAUD
SGDCNY
SGDHKD
SGDIDR
SGDINR
SGDJPY
SGDMYR
SGDNZD
SGDPHP
SGDTHB
SGDTWD
SGDUSD
Performance in %
%
-10.00 -0.00 2.00 4.00 6.00 12.00 8.00
-1.25
-7.98
9.90
4.57
1.98
-1.31
-2.40
0.13
-4.63
2.49
3.01
2.44
10.00 -8.00 -6.00 -4.00 -2.00
CAPITAL THOMSON REUTERS I/B/E/S ESTIMATES
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provides investment professionals with a global
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cash ow per share, dividends per share, and net
prots per share plus additional measures such
as sales, Ebit, Ebitda and recommendations for
publicly traded corporations worldwide. Intro-
duced in 1971 as a tool for investors in US markets,
I/B/E/S has expanded to around 21,000 companies
in more than 80 countries. I/B/E/S collects earnings
estimates from analysts associated with over 850
research rms globally.
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CORPs and certain other sources.
Neither Thomson Reuters, any source, nor any
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Nor shall any of them be liable for any error or
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or its subscribers or the accuracy, completeness or
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Glossary to I/B/E/S Estimates
EPS FY1: The reported earnings per share (EPS)
of the arithmetic average of all the estimates
PER FY1: Price-to-earnings ratio (price divided
by EPS)
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COMPANY LONG NAME COUNTRY NAME MARKET CAP CURRENCY PRICE EPS FY1 EPS FY1
(US$ MIL) (LATEST) MEAN PER
COMPANY LONG NAME COUNTRY NAME MARKET CAP CURRENCY PRICE EPS FY1 EPS FY1
(US$ MIL) (LATEST) MEAN PER
BASIC INDUSTRIES
CHINA SHENHUA ENERGY CO LTD China 65,386.16 CNY 25.34 2.18 11.63
COAL INDIA LTD India 50,170.28 INR 378.40 24.04 15.74
POSCO South Korea 32,537.99 KRW 413,000.00 55,087.13 7.50
WESFARMERS LTD Australia 31,610.37 AUD 30.62 2.15 14.21
RIO TINTO LTD Australia 30,648.39 USD 70.33 9.02 7.80
NEWCREST MINING LTD Australia 30,104.38 AUD 38.34 2.07 18.51
HYUNDAI MOBIS South Korea 29,379.52 KRW 334,000.00 34,723.13 9.62
FORMOSA PETROCHEMICAL CORP Taiwan 27,019.67 TWD 84.10 5.13 16.39
LG CHEMICAL LTD South Korea 19,642.09 KRW 328,000.00 36,031.99 9.10
FORTESCUE METALS GROUP LTD Australia 18,339.51 USD 5.89 0.71 8.30
NAN YA PLASTICS CORP Taiwan 18,061.61 TWD 68.20 5.82 11.71
FORMOSA PLASTICS CORP Taiwan 17,134.40 TWD 83.00 8.27 10.04
HINDUSTAN UNILEVER LTD India 15,582.86 INR 343.55 10.80 31.81
UNITED COMPANY RUSAL LTD Hong Kong 15,516.40 USD 1.02 0.18 5.61
SIME DARBY BHD Malaysia 15,448.44 MYR 7.91 0.64 12.42
CHINA STEEL CORP Taiwan 15,223.82 TWD 30.00 2.05 14.62
PETRONAS CHEMICALS GROUP BHD Malaysia 15,027.63 MYR 5.78 0.42 13.92
MMTC LTD India 14,841.52 INR 707.05 -- --
BAOSHAN IRON & STEEL CO LTD China 13,892.36 CNY 5.07 0.68 7.47
CHINA COAL ENERGY CO China 12,759.24 CNY 8.91 0.67 13.26
CAPITAL GOODS
SAMSUNG ELECTRONICS South Korea 107,947.19 KRW 811,000.00 82,457.30 9.84
HON HAI PRECISION INDUSTRY Taiwan 26,136.92 TWD 72.50 6.64 10.93
HYUNDAI HEAVY INDUSTRIES South Korea 21,083.45 KRW 307,000.00 56,634.77 5.42
NMDC LTD India 20,747.35 INR 249.30 20.52 12.15
LARSEN & TOUBRO LTD India 20,067.35 INR 1,564.25 82.92 18.86
SANY HEAVY IND CO LTD China 17,882.22 CNY 15.05 1.23 12.26
CHINA UNITED NETWORK COMMUNICATION China 17,544.98 CNY 5.29 0.13 41.91
CHINA SHIPBUILDING INDUSTRY CO LTD China 16,438.34 CNY 11.46 0.60 19.25
CHINA YANGTZE POWER CO LTD China 16,368.33 CNY 6.34 0.52 12.19
CHINA STATE CONSTRUCTION ENGINEERING China 16,100.77 CNY 3.43 0.41 8.33
CHEUNG KONG INFRASTRUCTURE Hong Kong 13,722.89 HKD 45.75 3.32 13.78
KEPPEL CORP LTD Singapore 12,433.35 SGD 8.67 0.78 11.05
SIAM CEMENT PCL Thailand 12,051.54 THB 304.00 27.53 11.04
SAMSUNG ELECTRONICS South Korea 11,533.81 KRW 559,000.00 -- --
ANHUI CONCH CEMENT CO LTD China 10,883.25 CNY 17.39 2.37 7.33
PT UNITED TRACTORS TBK Indonesia 9,844.30 IDR 23,000.00 1,454.38 15.81
CHANGSHA ZOOMLION HEAVY IND & SC China 9,829.76 CNY 10.01 0.95 10.51
SAMSUNG ENGINEERING South Korea 8,891.70 KRW 246,000.00 13,487.18 18.24
JIZHONG ENERGY RESOURCES CO LTD China 8,757.91 CNY 24.20 1.64 14.77
SHANGHAI ELECTRIC GROUP CO LTD China 8,708.58 CNY 5.65 0.27 20.93
CONSUMER DURABLES
HYUNDAI MOTOR CO LTD South Korea 41,501.51 KRW 208,500.00 31,207.13 6.68
PT ASTRA INTERNATIONAL INC Indonesia 30,380.08 IDR 65,400.00 4,245.65 15.40
KIA MOTORS CORP South Korea 25,805.32 KRW 71,500.00 9,800.42 7.30
SAIC MOTOR CORP LTD China 22,617.97 CNY 15.64 1.83 8.54
JARDINE CYCLE & CARRIAGE LTD Singapore 11,754.80 USD 33.05 2.93 11.28
MAHINDRA & MAHINDRA India 10,491.32 INR 814.05 52.79 15.42
BAJAJ AUTO LTD India 9,885.19 INR 1,627.45 102.53 15.87
HERO MOTOCORP LTD India 9,245.82 INR 2,205.80 113.15 19.50
GD MIDEA HLDG COMPANY LTD China 7,810.85 CNY 14.75 1.20 12.26
MARUTI SUZUKI INDIA LTD India 7,002.31 INR 1,154.65 83.75 13.79
XINJIANG GUANGHUI INDUSTRY CO LTD China 6,860.19 CNY 22.52 0.62 36.29
BRILLIANCE CHINA AUTOMOTIVE Hong Kong 4,903.80 CNY 6.27 0.36 17.42
BOSCH LTD India 4,730.17 INR 7,176.85 344.26 20.85
POWER DIVERSITY AUTOMOBILE TRADE China 4,351.26 CNY 26.52 1.49 17.78
TITAN INDUSTRIES LTD India 4,226.49 INR 226.80 6.52 34.76
QINGDAO HAIER COMPANY LTD China 4,117.80 CNY 9.82 1.00 9.79
YULON MOTOR COMPANY Taiwan 3,193.58 TWD 60.20 2.50 24.08
MANDO CORP South Korea 3,143.61 KRW 191,000.00 13,433.56 14.22
GOERTEK INC China 2,965.88 CNY 25.22 0.61 41.19
FAW CAR CO LTD China 2,877.60 CNY 11.30 1.32 8.54
CONSUMER NON-DURABLES
KWEICHOW MOUTAI DISTILLERY GROUP China 32,625.27 CNY 200.84 7.31 27.47
ITC LTD India 32,323.90 INR 198.35 7.84 25.31
WILMAR INTERNATIONAL LTD Singapore 26,493.61 USD 4.14 0.26 15.82
YIBIN WULIANGYE CO LTD China 22,207.98 CNY 37.39 1.63 22.92
JIANGSU YANGHE BREWERY JOINT-STO China 19,456.11 CNY 138.16 3.94 35.10
FORMOSA CHEMICAL & FIBRE Taiwan 15,929.48 TWD 83.00 9.20 9.02
UNILEVER INDONESIA TBK PT Indonesia 14,051.81 IDR 16,050.00 519.24 30.91
PT GUDANG GARAM TBK Indonesia 12,032.45 IDR 54,500.00 2,596.07 20.99
DAIRY FARM INTERNATIONAL Hong Kong 11,527.29 USD 8.54 0.36 23.97
FOSTERS GROUP LTD Australia 9,781.37 AUD 4.91 0.26 18.65
COCA-COLA AMATIL LTD Australia 9,183.93 AUD 11.80 0.71 16.69
LUZHOU LAOJIAO CO LTD China 9,162.58 CNY 42.00 2.04 20.59
KT&G CORP South Korea 9,118.51 KRW 73,500.00 6,405.88 11.47
NESTLE INDIA India 8,591.40 INR 4,245.10 104.16 40.75
GREE ELECTRICAL APPLIANCES INC O China 8,443.53 CNY 19.15 1.92 9.96
HENAN SHUANGHUI INVESTMENT & DEV China 7,662.07 CNY 68.48 2.59 26.45
CHAROEN POKPHAND FOODS PCL Thailand 7,328.65 THB 29.50 2.31 12.79
LG HOUSE & HEALTH CARE South Korea 6,957.73 KRW 493,000.00 17,584.91 28.04
GOLDEN AGRI-RESOURCES LTD Singapore 6,689.17 USD 0.55 0.05 10.59
FRASER & NEAVE LTD Singapore 6,632.30 SGD 5.85 0.48 12.31
CONSUMER SERVICES
HUTCHISON WHAMPOA LTD Hong Kong 34,557.97 HKD 63.20 13.87 4.56
JARDINE STRATEGIC HLDGS LTD Hong Kong 31,225.60 USD 27.88 2.43 11.47
WOOLWORTHS LTD Australia 30,804.81 AUD 24.61 1.81 13.60
WIPRO LTD India 18,095.21 INR 350.90 22.93 15.30
ADANI ENTERPRISES LTD India 13,955.40 INR 604.50 31.56 19.15
LI & FUNG LTD Hong Kong 13,799.90 HKD 13.28 0.62 21.55
SUN ART RETAIL GROUP LTD Hong Kong 11,680.45 CNY 7.83 0.18 43.88
SUNING APPLIANCE CO LTD China 11,417.70 CNY 10.43 0.75 13.99
GENTING BHD Malaysia 11,226.84 MYR 9.30 0.76 12.30
SWIRE PACIFIC LTD Hong Kong 10,836.41 HKD 93.30 6.63 14.07
SJM HLDGS LTD Hong Kong 10,811.50 HKD 15.28 1.05 14.49
HAITONG SECURITIES CO LTD China 10,363.63 CNY 8.05 0.56 14.40
LOTTE SHOPPING CO South Korea 10,222.20 KRW 389,500.00 42,502.96 9.16
SAMSUNG C&T CORP South Korea 10,079.02 KRW 71,400.00 3,258.04 21.92
BRAMBLES LTD Australia 9,745.83 USD 6.58 0.45 14.62
E-MART CO LTD South Korea 8,337.74 KRW 331,000.00 19,988.59 16.56
CP ALL PUBLIC COMPANY LTD Thailand 7,458.89 THB 50.25 1.84 27.32
SWIRE PACIFIC LTD Hong Kong 7,206.75 HKD 18.76 -- --
GENTING MALAYSIA BHD Malaysia 6,580.93 MYR 3.42 0.26 13.31
CROWN LTD Australia 6,347.13 AUD 8.20 0.53 15.40
ENERGY
PETROCHINA CO LTD China 243,985.23 CNY 9.63 0.87 11.07
BHP BILLITON LTD Australia 120,641.73 USD 37.57 4.68 8.03
CHINA PETROLEUM & CHEMICAL CORP China 77,131.97 CNY 7.05 0.93 7.55
CNOOC LTD Hong Kong 75,940.43 CNY 10.87 1.56 6.98
RELIANCE INDUSTRIES LTD India 58,524.11 INR 851.50 71.03 11.99
OIL & NATURAL GAS CORP India 46,988.75 INR 261.65 31.70 8.25
NTPC LTD India 29,752.21 INR 171.90 11.93 14.41
PTT PUBLIC COMPANY LTD Thailand 29,232.20 THB 310.00 36.39 8.52
WOODSIDE PETROLEUM LTD Australia 27,004.57 USD 34.04 2.10 16.22
PTT EXPLORATION & PRODUCTION PCL Thailand 17,932.53 THB 163.50 14.03 11.65
INDIAN OIL CORP LTD India 15,770.99 INR 309.45 35.52 8.71
ORIGIN ENERGY LTD Australia 14,052.45 AUD 12.85 0.82 15.64
SK INNOVATION CO LTD South Korea 13,911.82 KRW 166,500.00 31,125.39 5.35
YANZHOU COAL MINING CO LTD China 12,463.40 CNY 26.91 2.06 13.09
S-OIL CORP South Korea 12,258.82 KRW 120,500.00 14,945.53 8.06
CAIRN INDIA India 12,190.43 INR 305.30 44.68 6.83
COAL & ALLIED INDUSTRIES LTD Australia 10,908.85 AUD 122.75 6.96 17.64
SHANXI LUAN ENVIRONMENTAL ENGINEERING China 10,430.67 CNY 28.97 1.79 16.20
SANTOS LTD Australia 10,121.73 AUD 11.23 0.57 19.80
SHANXI GUOYANG NEW ENERGY CO LTD China 8,978.77 CNY 23.86 1.26 19.01
FINANCE
INDUSTRIAL & COMMERCIAL BANK OF China 166,993.82 CNY 4.07 0.59 6.96
AGRICULTURAL BANK OF CHINA LTD China 116,407.43 CNY 2.53 0.39 6.56
BANK OF CHINA LTD China 89,028.00 CNY 2.91 0.45 6.44
COMMONWEALTH BANK OF AUSTRALIA Australia 70,985.85 AUD 44.37 4.50 9.87
WESTPAC BANKING CORP Australia 59,809.23 AUD 19.23 2.10 9.15
AUSTRALIA & NEW ZEALAND BANKING Australia 52,133.80 AUD 19.32 2.14 9.02
CHINA LIFE INSURANCE CO LTD China 50,796.25 CNY 15.59 1.17 13.32
NATIONAL AUSTRALIA BANK LTD Australia 49,703.61 AUD 22.00 2.48 8.88
AIA GROUP LTD Hong Kong 37,781.89 USD 3.14 0.21 15.25
SUN HUNG KAI PROPERTIES LTD Hong Kong 33,555.64 HKD 101.80 7.90 12.89
JARDINE MATHESON HLDGS LTD Hong Kong 32,655.00 USD 49.76 3.99 12.46
CHINA MERCHANTS BANK CO LTD China 31,622.68 CNY 11.44 1.57 7.28
PING AN INSURANCE COMPANY China 29,193.28 CNY 38.98 2.97 13.14
CHEUNG KONG HLDGS LTD Hong Kong 28,488.27 HKD 95.90 17.99 5.33
BANK OF CHINA (HONG KONG) HLDG Hong Kong 27,120.47 HKD 20.00 1.84 10.88
STATE BANK OF INDIA India 26,512.24 INR 1,989.05 237.05 8.39
SHANGHAI PUDONG DEVELOPMENT BANK China 25,859.76 CNY 8.86 1.36 6.51
HANG SENG BANK LTD Hong Kong 25,746.58 HKD 105.00 8.55 12.28
HDFC BANK India 24,098.83 INR 491.25 22.27 22.06
BANK OF COMMUNICATIONS CO LTD China 23,440.38 CNY 4.58 0.79 5.83
HEALTHCARE
CSL LTD Australia 14,740.09 AUD 27.20 1.86 14.60
SUN PHARMACEUTICALS INDS LTD India 10,523.20 INR 484.10 20.34 23.80
YUNNAN BAIYAO GROUP CO LTD China 6,463.60 CNY 59.50 1.76 33.74
DR REDDYS LABORATORIES LTD India 5,472.76 INR 1,537.95 79.39 19.37
JIANGSU HENRUI MEDICINE CO LTD China 5,199.48 CNY 29.56 0.84 35.18
KANGMEI PHARMACEUTICAL CO LTD China 4,978.16 CNY 14.47 0.52 27.78
CIPLA LTD India 4,758.71 INR 282.35 14.07 20.07
SICHUAN KELUN PHARMACEUTICAL CO China 4,573.93 CNY 60.90 2.08 29.33
SHANGHAI PHARMACEUTICALS HLDG China 4,540.50 CNY 15.09 0.86 17.61
LUPIN LTD India 4,523.08 INR 482.60 21.95 21.98
SONIC HEALTHCARE LTD Australia 4,514.99 AUD 11.28 0.81 13.87
SHANDONG DONG-E-EJIAO COMPANY LI China 4,490.45 CNY 43.88 1.43 30.66
RANBAXY LABORATORIES LTD India 4,309.74 INR 487.10 24.55 19.84
PT KALBE FARMA TBK Indonesia 4,020.45 IDR 3,450.00 158.25 21.80
DABUR INDIA LTD India 3,828.55 INR 104.70 3.89 26.89
SHENZHEN HEPALINK PHARMACEUTICAL China 3,806.30 CNY 30.40 1.38 21.97
RAMSAY HEALTH CARE LTD Australia 3,739.71 AUD 18.03 1.15 15.75
GLAXOSMITHKLINE PHARMACEUTICALS India 3,664.33 INR 2,060.95 79.15 26.04
CADILA HEALTHCARE LTD India 3,542.27 INR 824.20 40.64 20.28
BANGKOK DUSIT MED SERVICE Thailand 3,471.79 THB 68.00 2.67 25.50
PUBLIC UTILITIES
CHINA MOBILE LTD Hong Kong 206,241.92 CNY 65.67 6.17 10.64
CHINA UNICOM (HK) LTD Hong Kong 52,569.79 CNY 14.26 0.26 55.69
SINGAPORE TELECOMMUNICATIONS Singapore 39,203.59 SGD 3.06 0.25 12.45
TELSTRA CORP LTD Australia 38,825.54 AUD 3.04 0.29 10.65
BHARTI AIRTEL LTD India 31,211.65 INR 391.55 19.03 20.57
CHUNGHWA TELECOM CO LTD Taiwan 26,111.07 TWD 99.80 6.11 16.33
CLP HLDGS LTD Hong Kong 23,129.76 HKD 74.95 4.50 16.64
HONG KONG & CHINA GAS CO Hong Kong 18,847.27 HKD 18.60 0.73 25.56
TELEKOMUNIKASI INDONESIA TBK PT Indonesia 17,233.73 IDR 7,450.00 607.74 12.26
POWER ASSETS HLDGS LTD Hong Kong 17,217.75 HKD 62.90 4.22 14.91
BHARAT HEAVY ELECTRICALS India 16,891.21 INR 1,643.85 137.41 11.96
MAXIS BHD Malaysia 12,967.18 MYR 5.32 0.31 17.00
AXIATA GROUP BHD Malaysia 12,818.38 MYR 4.66 0.33 14.12
KOREA ELECTRIC POWER (KEPCO) South Korea 12,704.12 KRW 21,900.00 1,106.62 19.79
ADVANCED INFO SERVICE PCL Thailand 12,179.18 THB 124.00 8.13 15.25
GAIL INDIA LTD India 11,626.38 INR 436.65 33.71 12.95
SK TELECOM CO LTD South Korea 10,981.10 KRW 150,500.00 22,901.23 6.57
PHILIPPINE LONG DISTANCE TEL Philippines 10,061.74 PHP 2,294.00 209.52 10.95
TAIWAN MOBILE CO LTD Taiwan 9,999.06 TWD 78.00 4.65 16.77
POWER GRID CORP OF INDIA LTD India 9,601.53 INR 98.80 6.69 14.76
TECHNOLOGY
TAIWAN SEMICONDUCTOR MANUFACTURING Taiwan 61,618.07 TWD 70.50 5.25 13.44
TATA CONSULTANCY SERVICES LTD India 43,462.30 INR 1,057.90 52.95 19.98
INFOSYS LTD India 29,235.72 INR 2,437.70 136.33 17.88
HTC CORP Taiwan 22,154.59 TWD 762.00 82.00 9.29
MEDIATEK INCORPORATED Taiwan 12,112.73 TWD 326.50 13.15 24.83
HYNIX SEMICONDUCTOR South Korea 11,584.98 KRW 21,650.00 1,502.46 14.41
NHN CORP South Korea 9,458.98 KRW 217,500.00 10,762.29 20.21
QUANTA COMPUTER Taiwan 7,382.86 TWD 57.00 5.79 9.84
LG DISPLAY CO LTD South Korea 6,967.81 KRW 21,550.00 -349.83 --
SK C&C CO LTD South Korea 6,799.80 KRW 150,500.00 10,923.91 13.78
LENOVO GROUP LTD Hong Kong 6,792.70 USD 0.66 0.04 15.53
NCSOFT CORP South Korea 6,679.77 KRW 338,500.00 7,957.98 42.54
HANGZHOU HIKVISION DIGITAL TECHN China 6,634.33 CNY 42.40 1.50 28.29
ADVANCED SEMICONDUCTOR ENGINEERING Taiwan 6,466.38 TWD 28.40 2.46 11.56
ASUSTEK COMPUTER INC Taiwan 6,397.83 TWD 252.00 21.02 11.99
HCL TECHNOLOGIES LTD India 5,836.96 INR 403.25 30.77 13.11
NARI TECH DEVELOPMENT CO LTD China 5,786.75 CNY 35.21 0.73 48.14
UNITED MICROELECTRONICS CORP Taiwan 4,985.74 TWD 11.30 0.96 11.77
CATCHER TECHNOLOGY CO LTD Taiwan 4,700.59 TWD 187.00 14.87 12.57
COMPUTERSHARE LTD Australia 4,123.72 USD 7.42 0.56 13.31
TRANSPORTATION
MTR CORP Hong Kong 18,844.06 HKD 25.40 1.67 15.24
DAQIN RAILWAY COMPANY LTD China 17,004.58 CNY 7.31 0.84 8.70
SHANGHAI INTL PORT GROUP CO LTD China 11,536.03 CNY 3.24 0.25 13.21
AIR CHINA LTD China 11,220.31 CNY 8.45 0.93 9.08
SINGAPORE AIRLINES LTD Singapore 10,617.55 SGD 11.01 0.64 17.31
MISC BHD Malaysia 9,980.79 MYR 6.88 0.16 44.08
TATA MOTORS LTD India 9,384.48 INR 166.10 27.45 6.05
QR NATIONAL LTD Australia 8,239.52 AUD 3.29 0.18 18.69
CHINA SOUTHERN AIRLINES CO LTD China 7,735.79 CNY 7.04 0.64 11.03
CHINA COSCO HLDGS CO LTD China 7,670.32 CNY 6.42 0.23 27.45
CSR CORP LTD China 6,957.67 CNY 4.53 0.35 13.02
CATHAY PACIFIC AIRWAYS Hong Kong 6,619.56 HKD 13.12 1.69 7.75
MUNDRA PORT SPECIAL ECONOMIC ZON India 6,478.23 INR 154.05 6.20 24.84
GLOVIS CO LTD South Korea 6,285.86 KRW 185,500.00 9,360.13 19.82
CHINA MERCHANTS HLDGS INTERNATIONAL Hong Kong 6,269.76 HKD 19.78 2.19 9.03
MAP GROUP Australia 6,208.62 AUD 3.25 0.16 20.03
CHINA EASTERN AIRLINES H China 6,149.30 CNY 5.05 0.46 11.00
NINGBO PORT CO LTD China 5,988.42 CNY 2.99 0.20 15.23
NWS HLDGS LTD Hong Kong 4,727.49 HKD 10.88 1.09 10.00
ASCIANO LTD Australia 4,625.16 AUD 1.54 0.10 14.73
CAPITAL FACTSET ESTIMATES CONSENSUS SINGAPORE
The Edge/FactSet Estimates Consensus Table
pre sents the earnings forecast of Singaporean eq-
uities using the latest and more robust FactSet
metho do logy that provides more timely and use ful
infor mation.
FactSet utilises only the latest estimates in
calculating the consensus. Any estimates that
are more than 75 days old are discarded to avoid
the possibility of old forecasts polluting the
consensus.
The latest 45-day forecast EPS not only gives
you the more robust consensus but also a glimpse
of the earnings trend, while the Recommendation
Consensus Rating is the scale that measures how
the analysts feel about a stock.
FactSet offers instant access to accurate -
nancial data and analytics to thousands of in-
vestment professionals around the world. Our
CO combines more than 200 databases from
industry-leading suppliers and clients own pro-
prietary data into a single powerful information
system, making FactSet a one-stop source for
nancial information.
Glossary to FactSet Estimates Consensus Table
Price: Closing price as of stated date
Market Capitalisation ($): Market capitalisa-
tion ($) in millions
Recommendation Consensus Rating: The
following rating is assigned to each type of
re commendation provided by participating
brokers:
1 = positive (strong buy)
1.5 = overweight
2 = neutral
2.5 = underweight
3 = negative (strong sell)
= no recommendation from brokers at that
point of time
The average of all recommendations is then calcu-
lated to give the consensus rating
No of Estimates (75 days): Number of esti-
mates that are less than 75 days old and are
included in the consensus calculation
PER 2011: The forecast PE ratio for year 2011
(NA unable to calculate, for example nega-
tive earnings per share gures)
EPS 2011 (75 days): The forecast earnings per
share for year 2010 using estimates from the lat-
est 75 days
EPS 2011 (45 days): The forecast earnings per
share for year 2010 using estimates from the lat-
est 45 days
EPS Growth: Earnings per share growth com-
pared to last year (R = Recovery)
6-month performance: Six-month price per-
formance for that equity
6-month performance relative to STI: Six-
month price performance relative to the Straits
Times Index.
Disclaimer
In no event will FactSet or The Edge be responsible
for special, indirect, incidental or consequential
damages that may be incurred or experienced on
account of entering into or relying on the data.
FactSet acts solely as a transmitter of informa-
tion provided by certain brokers, certain corpora-
tions and certain other sources.
Neither FactSet, any source or any third par-
ty which FactSet contracts to effect transmission
makes any warranty of merchantability or tness
for a particular purpose with respect to the FactSet
nancial information, nor shall any of them be li-
able for any error or omission in the information
supplied to The Edge or its subscribers or the accu-
racy, completeness or timeliness of the data.
COMPANY PRICE MARKET RECOMMENDATION RECOMMENDATION NO OF PER 2011 2011 EPS 2011 EPS 2011 EPS 6-MONTH
CAPITALISATION CONSENSUS 75 DAYS CONSENSUS 75 DAYS ESTIMATES (X) (75 DAYS) (45 DAYS) GROWTH (%) PERFORMANCE
($ MIL) AS OF 20/09/11 AS OF 28/06/11 (75 DAYS) (%)
E
/
AIMS AMP CAPITAL INDUSTRIAL REIT 0.20 443.85 1.00 1.00 3 10.13 0.02 0.02 10.83 0.00
ALLGREEN PROPERTIES 1.59 2,528.70 2.00 1.75 3 10.60 0.15 0.15 7.14 50.00
AMTEK ENGINEERING LTD 0.66 358.52 1.50 1.50 4 6.21 0.11 0.11 83.05 -40.00
ARA ASSET MANAGEMENT LTD 1.30 1,002.65 1.31 1.50 8 15.29 0.09 0.08 -1.81 -19.35
ARMSTRONG INDUSTRIAL CORP 0.25 129.46 1.67 2.75 3 8.62 0.03 0.03 -40.82 -33.33
ASCENDAS INDIA TRUST 0.86 656.80 1.50 1.38 3 12.41 0.07 0.07 57.31 -6.04
ASCENDAS REAL ESTATE 2.09 4,352.22 1.82 1.88 15 16.08 0.13 0.13 0.00 10.58
ASCOTT RESIDENCE TRUST 1.06 1,195.01 1.61 1.57 8 15.04 0.07 0.07 18.74 -5.36
ASIAN PLANTATIONS LTD 259.50 105.66 1.50 1.00 3 NA -9.46 -9.95 R+ 4.22
ASL MARINE HLDGS LTD 0.49 206.79 1.50 1.33 6 6.45 0.08 0.08 -25.89 -17.65
AVAGO TECHNOLOGIES LTD 36.32 8,916.03 1.21 1.21 11 13.50 2.69 2.69 22.83 19.79
BANYAN TREE HLDGS LTD 0.64 491.10 2.00 2.00 1 49.62 0.01 0.01 -38.10 -18.87
BBR HLDGS LTD 0.22 66.27 1.00 1.00 2 2.89 0.07 0.07 17.61 -10.42
BIOSENSORS INTERNATIONAL GROUP LTD 1.29 1,743.39 1.50 1.67 2 25.23 0.05 0.04 25.28 17.73
BOUSTEAD SPORE LTD 0.85 439.65 1.00 1.33 2 10.54 0.08 0.08 -21.79 -9.57
BROADWAY INDUSTRIAL GROUP 0.34 141.59 2.00 2.00 3 5.21 0.07 0.06 -39.90 -28.42
BUKIT SEMBAWANG ESTATES 3.98 1,030.47 1.50 1.75 1 6.55 0.59 0.59 -14.39 -3.63
CACHE LOGISTICS TRUST 1.00 636.84 1.30 1.33 4 13.70 0.07 0.07 12.91 6.38
CAMBRIDGE INDUSTRIAL TRUST 0.48 570.81 1.30 1.70 3 6.67 0.07 0.07 -13.79 1.05
CAPITACOMMERCIAL TRUST 1.11 3,141.16 1.62 1.68 13 16.32 0.07 0.07 -3.85 -18.38
CAPITAL DRILLING LTD 90.50 121.81 1.00 1.00 1 11.72 7.72 7.72 34.37 -7.65
CAPITALAND LTD 2.60 11,100.42 1.35 1.38 21 16.05 0.16 0.16 -33.83 -17.20
CAPITAMALL TRUST 1.92 6,117.72 1.56 1.71 13 21.33 0.09 0.09 3.61 12.28
CAPITAMALLS ASIA LTD 1.29 5,031.14 1.34 1.63 15 18.77 0.07 0.06 -36.70 -24.71
CAPITARETAIL CHINA TRUST 1.21 831.78 1.42 1.50 6 14.73 0.09 0.08 2.73 -0.82
CDL HOSPITALITY TRUSTS 1.67 1,610.98 1.66 1.54 13 14.69 0.11 0.12 17.98 -11.38
CEREBOS PACIFIC LTD 4.80 1,520.47 1.50 1.50 1 16.44 0.29 0.29 -36.11 -0.96
CH OFFSHORE LTD 0.39 274.98 1.50 1.50 1 6.84 0.06 0.06 -16.18 -9.30
CHINA FARM EQUIPMENT LTD 0.26 64.13 1.00 1.00 1 7.57 0.04 0.04 34.62 6.00
CHINA FISHERY GROUP LTD 1.27 1,298.26 1.17 1.50 3 8.04 0.16 0.16 6.99 -29.83
CHINA SUNSINE CHEMICAL HLDGS LTD 0.25 116.95 1.00 1.00 1 5.44 0.05 0.05 -3.92 0.00
CITY DEVELOPMENTS LTD 10.10 9,183.94 1.93 2.00 21 12.29 0.82 0.82 5.91 -2.51
CNA GROUP LTD 0.17 45.45 3.00 3.00 1 13.92 0.01 0.01 R+ -7.22
COMFORTDELGRO CORP LTD 1.32 2,759.61 1.43 1.42 14 12.00 0.11 0.11 0.00 -12.00
CONSCIENCEFOOD HLDG LTD 0.20 81.23 1.50 1.50 1 5.26 0.04 0.04 0.00 -14.58
COSCO CORP SINGAPORE LTD 1.01 2,272.81 2.47 1.83 19 12.69 0.08 0.08 -25.87 -43.92
CSC HLDGS LTD 0.10 124.25 2.00 1.00 1 25.25 0.00 0.00 0.00 -22.31
CSE GLOBAL LTD 0.95 490.26 1.63 1.50 4 12.63 0.08 0.08 -27.61 -18.80
CWT LTD 1.03 610.96 1.10 1.10 5 12.78 0.08 0.08 25.49 -11.54
DAIRY FARM INTL HLDGS 8.54 11,530.44 2.17 2.00 3 23.54 0.37 0.37 12.99 15.09
DBS GROUP HLDG LTD 12.33 28,898.82 1.37 1.32 22 9.93 1.24 1.24 75.01 -11.93
ELEC & ELTEK INTERNATIONAL CO LTD 2.98 556.82 1.50 1.50 2 8.44 0.35 0.36 -22.45 -8.87
EOC LTD 6.20 687.91 1.67 1.50 3 7.36 0.84 0.84 -25.08 -11.43
EZION HLDGS LTD 0.56 399.97 1.11 1.13 8 6.12 0.09 0.09 33.99 -13.18
EZRA HLDGS LTD 0.93 802.80 1.55 1.45 10 15.71 0.06 0.06 -53.76 -44.94
FIRST RESOURCES LTD 1.32 1,931.01 1.15 1.10 10 10.65 0.12 0.12 19.56 5.20
FIRST SHIP LEASE TRUST 0.29 193.13 1.50 1.50 3 NA 0.00 0.01 R+ -26.25
FJ BENJAMIN HLDGS LTD 0.34 193.36 1.13 1.00 4 14.78 0.02 0.02 53.33 -2.86
FORTUNE REAL ESTATE INV TRUST 3.61 6,055.00 1.50 1.50 6 16.52 0.22 0.23 12.16 -5.99
FRASER & NEAVE LTD 5.85 8,253.98 1.33 1.33 9 12.21 0.48 0.48 -5.56 9.14
FRASERS CENTREPOINT TRUST 1.48 1,138.43 1.36 1.38 8 19.54 0.08 0.08 -3.06 3.87
FRASERS COMMERCIAL TRUST 0.82 517.37 1.33 1.50 3 15.19 0.05 0.05 156.25 9.33
GALLANT VENTURE LTD 0.30 723.74 1.25 1.25 2 60.00 0.01 0.01 25.00 -17.81
GENTING HONG KONG LTD 0.32 2,525.97 1.17 1.25 3 17.73 0.02 0.02 128.42 -15.58
GENTING SINGAPORE PLC 1.68 20,484.12 1.48 1.43 24 18.98 0.09 0.09 60.04 -10.64
GLOBAL LOGISTIC PROPERTIES 1.77 8,134.31 1.36 1.29 6 20.84 0.09 0.09 -40.44 -1.12
GMG GLOBAL LTD 0.23 902.19 1.50 1.00 3 11.75 0.02 0.02 100.00 -12.96
GOLDEN AGRI-RESOURCES LTD 0.69 8,436.31 1.25 1.46 16 10.74 0.06 0.07 45.06 8.59
GOODPACK 1.70 843.53 2.00 1.58 5 15.25 0.11 0.11 11.81 -2.30
GREAT EASTERN HLDGS LTD 12.48 5,906.97 1.25 1.25 2 10.97 1.14 1.23 12.33 -13.39
GUOCOLAND LTD 2.00 2,366.74 1.00 2.00 1 29.72 0.07 0.07 R+ -14.89
HIAP SENG ENGINEERING LTD 0.29 88.09 2.25 2.50 2 6.11 0.05 0.05 82.69 -38.30
HI-P INTERNATIONAL LTD 0.58 514.56 2.00 1.50 2 6.44 0.09 0.09 16.25 -44.23
HO BEE INVESTMENT LTD 1.36 999.09 1.63 1.50 4 5.65 0.24 0.24 -42.58 -1.09
HONG LEONG ASIA LTD 1.59 592.55 1.63 1.67 4 5.72 0.28 0.28 -5.06 -37.84
HONG LEONG FINANCE LTD 2.40 1,057.14 1.63 2.17 4 10.43 0.23 0.23 -17.77 -17.24
HONGKONG LAND HLDGS LTD 5.00 11,687.80 1.73 1.22 14 16.76 0.30 0.29 -17.99 -25.93
HOTEL PROPERTIES LTD 2.04 1,031.89 1.00 1.00 1 14.07 0.15 0.15 -47.27 -10.13
HTL INTERNATIONAL HLDGS LTD 0.35 147.88 3.00 3.00 1 12.24 0.03 0.03 -53.97 -38.26
HUTCHISON PORT HLDGS TRUST 0.65 5,704.31 1.75 1.73 10 20.45 0.03 0.03 1.11 -31.05
HYFLUX 1.68 1,451.66 1.72 1.71 8 20.55 0.08 0.08 -20.59 -13.59
INDOFOOD AGRI RESOURCES LTD 1.42 2,055.83 1.34 1.73 17 8.87 0.16 0.16 19.21 -33.02
JARDINE CYCLE & CARRIAGE LTD 41.68 14,825.12 2.00 1.75 1 11.82 3.53 3.53 20.75 24.72
JARDINE MATHESON HLDGS LTD 49.76 32,654.93 2.14 1.50 6 12.48 3.99 4.05 3.79 14.13
JARDINE STRATEGIC HLDGS LTD 27.88 31,222.70 1.60 1.60 5 11.68 2.39 2.42 2.99 7.23
JAYA HLDG LTD 0.45 347.27 2.00 1.50 1 5.11 0.09 0.09 -34.33 -13.46
K REAL ESTATE INVESTMENT TRUST ASIA 1.11 1,511.39 1.81 1.65 11 23.62 0.05 0.05 -20.59 -11.20
KENCANA AGRI LTD 0.35 407.55 1.50 1.50 2 19.08 0.02 0.02 41.08 -11.25
KEPPEL CORP LTD 8.67 15,455.49 1.28 1.28 24 10.97 0.80 0.80 -8.93 -16.34
KEPPEL LAND LTD 2.94 4,380.16 1.65 1.72 21 12.62 0.23 0.20 -61.75 -28.12
KIAN ANN ENGINEERING LTD 0.22 96.38 1.00 1.00 2 5.92 0.04 0.04 23.40 7.32
KINGSMEN CREATIVES LTD 0.56 106.46 1.00 1.00 3 7.01 0.08 0.08 0.88 3.70
KREUZ HLDGS LTD 0.34 174.91 1.00 1.00 1 4.63 0.07 0.07 285.25 2.98
KS ENERGY LTD 1.02 430.08 1.50 1.00 2 112.22 0.01 0.01 R+ 13.33
KSH HLDGS LTD 0.22 75.80 1.00 1.00 3 5.15 0.04 0.04 -32.23 0.00
LEADER ENVIRONMENTAL TECHNOLOGIES LTD 0.14 67.35 1.00 1.00 2 2.58 0.05 0.05 55.88 -39.11
LIAN BENG GROUP 0.35 188.06 1.00 1.00 1 3.48 0.10 0.10 12.09 26.79
M1 LTD 2.43 2,205.73 1.71 1.60 18 12.86 0.19 0.19 5.88 2.10
MACQUARIE INTL INFRASTRUCTURE FUND LTD 0.50 625.70 2.00 2.00 1 17.86 0.03 0.03 180.00 -13.04
MAN WAH HLDGS LTD 3.74 3,632.04 1.00 1.30 4 5.05 0.75 0.74 16.38 -67.65
MANDARIN ORIENTAL INTL 1.55 1,545.03 1.67 1.00 3 19.37 0.08 0.07 60.00 -22.11
MAPLETREE COMMERCIAL TRUST 0.87 1,619.07 1.25 1.36 8 17.94 0.05 0.05 11.63 R+
MAPLETREE INDUSTRIAL TRUST LTD 1.20 1,953.80 1.30 1.38 9 15.00 0.08 0.08 2.27 19.95
MAPLETREE LOGISTICS TRUST 0.88 1,952.42 1.36 1.27 13 13.13 0.07 0.07 2.59 4.76
MARCO POLO MARINE LTD 0.40 136.30 1.00 1.00 2 7.69 0.05 0.05 -11.11 12.68
MERCATOR LINES (SINGAPORE) LTD 0.14 175.29 2.00 2.00 1 7.38 0.02 0.02 -47.82 -30.00
MEWAH INTERNATIONAL INC 0.47 700.78 2.43 1.20 7 10.57 0.04 0.04 -46.33 -46.55
MICLYN EXPRESS OFFSHORE LTD 1.52 417.42 1.30 1.33 1 7.79 0.20 0.20 73.74 -12.64
MIDAS HLDGS LTD 0.42 511.81 1.39 1.31 9 9.13 0.05 0.05 6.16 -38.24
MORTICE LTD 56.50 26.95 1.00 1.00 1 14.30 3.95 3.95 286.63 -4.24
MUN SIONG ENGINEERING LTD 0.11 45.42 2.00 1.00 1 6.81 0.02 0.02 -44.83 -39.45
NEPTUNE ORIENT LINES LTD 1.11 2,869.34 1.94 1.93 17 NA -0.04 -0.05 R+ -43.08
NOBLE GROUP LTD 1.58 10,145.09 1.24 1.15 17 11.79 0.13 0.13 12.32 -22.55
OKP HLDGS 0.57 173.70 1.50 2.00 2 7.65 0.07 0.07 20.31 -4.20
OLAM INTERNATIONAL LTD 2.51 6,130.10 1.47 1.47 18 16.09 0.16 0.16 8.72 -2.46
OM HLDGS LTD 0.69 347.83 2.50 2.00 2 38.44 0.02 0.02 -80.55 -49.26
OSIM INTL 1.17 938.49 1.00 1.00 6 12.12 0.10 0.09 36.49 -24.03
OTTO MARINE LTD 0.14 274.11 2.63 2.30 3 NA 0.00 0.00 R+ -29.27
OVERSEA-CHINESE BANKING CORP 8.38 28,411.30 1.57 1.36 22 11.92 0.71 0.70 5.77 -6.89
OVERSEAS UNION ENTERPRISES 2.12 2,080.99 1.27 1.11 13 15.59 0.14 0.21 -48.45 -24.82
PACIFIC ANDES RESOURCES DEVELOPMENT LTD 0.20 654.76 1.75 1.50 3 5.36 0.04 0.04 -16.56 -36.92
PACIFIC SHIPPING TRUST 0.36 212.31 1.50 1.50 1 5.07 0.07 0.07 16.39 2.86
PAN UNITED CORP 0.43 239.06 1.50 1.50 1 8.27 0.05 0.05 44.44 -12.24
PARKWAY LIFE REAL ESTATE INVESTMENT TRUST 1.86 1,125.24 1.58 1.50 5 18.98 0.10 0.10 10.84 12.05
PEC LTD 0.81 201.73 2.00 1.33 3 6.39 0.13 0.13 -31.47 -23.33
PETRA FOODS LTD 1.73 1,057.30 2.00 2.00 2 13.75 0.13 0.13 35.06 15.33
PHOTON KATHAAS PRODUCTIONS LTD 0.46 9.74 1.00 1.00 1 9.68 0.05 0.05 R+ -4.21
RAFFLES EDUCATION 0.47 415.34 1.67 1.67 3 9.90 0.05 0.05 -20.00 -37.91
RAFFLES MEDICAL GROUP 2.16 1,152.57 1.50 1.45 10 22.10 0.10 0.10 11.11 -1.82
RH PETROGAS LTD 0.60 274.09 1.00 1.00 2 65.98 0.01 0.01 83.82 -25.93
RICKMERS MARITIME TRUST 0.34 144.05 2.00 2.00 1 3.30 0.10 0.10 12.88 -13.92
ROTARY ENGINEERING LTD 0.63 357.75 2.00 1.25 3 7.24 0.09 0.09 -22.32 -30.00
SABANA SHARIAH COMPLIANT REIT 0.88 562.04 1.33 1.50 3 11.57 0.08 0.08 393.34 -5.35
SAKARI RESOURCES LTD 2.59 2,937.33 1.59 1.58 11 14.53 0.18 0.18 78.04 6.58
SARIN TECHNOLOGIES LTD 0.82 222.10 1.00 1.00 2 12.25 0.07 0.08 8.36 42.61
SATS LTD 2.28 2,528.81 1.92 1.63 13 12.74 0.18 0.18 0.15 -9.88
SC GLOBAL DEVELOPMENT LTD 1.16 481.16 2.25 2.13 4 2.88 0.40 0.40 16.04 -13.43
SECOND CHANCE PROPERTIES LTD 0.38 174.88 1.00 1.00 1 4.75 0.08 0.08 185.71 6.74
SEMBCORP INDUSTRIES LTD 3.78 6,762.33 1.34 1.54 17 9.22 0.41 0.40 -4.76 -21.41
SEMBCORP MARINE LTD 3.77 7,861.03 1.29 1.44 21 11.37 0.33 0.33 -14.22 -28.87
SIA ENGINEERING CIE 4.00 4,386.16 1.79 1.77 7 15.87 0.25 0.26 8.70 1.52
SINGAPORE AIRLINES LTD 11.01 13,210.35 1.95 1.81 21 20.58 0.53 0.57 -38.01 -10.98
SINGAPORE EXCHANGE LTD 6.82 7,308.04 1.65 1.66 19 24.67 0.28 0.29 -8.00 -6.83
SINGAPORE LAND 6.34 2,615.10 1.83 1.67 3 14.31 0.44 0.39 -37.47 0.00
SINGAPORE POST LTD 1.03 1,989.50 2.08 1.92 7 12.64 0.08 0.08 0.00 -11.21
SINGAPORE PRESS HLDG LTD 3.69 5,946.95 1.94 1.71 10 15.38 0.24 0.24 -23.54 -2.89
SINGAPORE TECHNOLOGIES ENGINEERING LTD 2.90 8,861.73 1.41 1.58 12 16.38 0.18 0.17 8.31 -7.05
SINGAPORE TELECOM 3.06 48,775.93 1.58 1.73 26 12.34 0.25 0.25 3.77 7.37
SINO GRANDNESS FOOD INDUSTRY GROUP LTD 0.43 112.70 1.00 1.00 3 3.70 0.12 0.02 38.92 -11.46
SMRT 1.77 2,696.78 2.18 2.04 14 17.66 0.10 0.10 -5.24 -6.58
SOUND GLOBAL LTD 0.53 683.70 1.10 1.17 5 9.46 0.06 0.06 22.54 -23.19
STARHILL GLOBAL REAL ESTATE INVESTMENT TRUST 0.61 1,175.53 1.58 1.25 6 12.87 0.05 0.05 -17.95 -3.20
STARHUB LTD 2.82 4,842.77 1.92 2.00 19 15.68 0.18 0.18 16.18 8.05
STX OSV HLDGS LTD 1.22 1,439.60 1.25 1.20 10 5.65 0.22 0.22 23.10 15.10
SUNPOWER GROUP LTD 0.23 77.31 1.00 1.00 2 3.50 0.07 0.07 31.42 -37.33
SUNTEC REAL ESTATE INVESTMENT TRUST 1.26 2,795.31 1.69 1.61 15 15.75 0.08 0.08 -15.92 -14.29
SUPER GROUP LTD 1.55 864.49 1.50 1.67 4 15.12 0.10 0.10 15.90 16.54
SWIBER HLDGS LTD 0.52 264.34 1.70 1.58 5 10.54 0.05 0.05 -42.52 -32.03
TAT HONG HLDS 0.73 369.84 2.50 2.30 5 12.17 0.06 0.06 17.65 -8.75
TIGER AIRWAYS HLDGS LTD 0.90 491.63 2.63 1.75 11 NA -0.02 -0.02 R+ -36.62
TIONG SENG HLDGS LTD 0.19 144.78 1.50 1.25 2 5.77 0.03 0.03 14.14 -14.09
TIONG WOON CORP HLDG 0.22 83.60 2.75 2.50 2 45.00 0.01 0.00 -81.06 -28.57
TUAN SING HLDG 0.28 328.96 1.00 1.00 1 9.50 0.03 0.03 -53.13 3.64
UNITED ENGINEERINGS 1.82 510.41 1.50 1.50 2 3.97 0.46 0.46 -36.16 -22.55
UNITED ENVIROTECH LTD 0.31 151.40 1.00 1.00 2 8.68 0.04 0.04 6.29 -14.87
UNITED INDUSTRIAL CORP LTD 2.71 3,733.87 2.50 2.50 1 20.07 0.14 0.14 1,400.00 -2.17
UNITED OVERSEAS BANK LTD 17.53 27,575.22 1.67 1.48 23 10.82 1.62 1.62 -5.34 -3.26
UOL GROUP LTD 4.46 3,426.14 1.25 1.38 8 6.47 0.69 0.69 8.62 -2.83
VENTURE CORP LTD 7.12 1,953.70 1.50 1.45 12 10.44 0.68 0.71 -1.33 -20.45
WHEELOCK PROPERTIES (SINGAPORE) LTD 1.65 1,980.29 2.17 1.50 4 10.78 0.15 0.12 -25.49 -9.07
WILMAR INTERNATIONAL LTD 5.22 33,413.68 1.58 1.69 19 16.16 0.32 0.32 22.87 3.98
WING TAI HLDGS LTD 1.29 1,028.13 1.79 1.75 12 5.44 0.23 0.23 27.78 -8.16
XINREN ALUMINIUM HLDGS LTD 0.35 389.79 1.50 1.50 1 4.80 0.07 0.07 12.12 -20.22
XP POWER PLC 1,081.00 208.01 1.00 1.00 4 9.63 111.60 112.20 33.17 -33.27
YAMADA GREEN RESOURCES LTD 0.19 77.25 1.00 1.00 1 2.71 0.07 0.07 40.00 -33.33
YANLORD LAND GROUP LTD 0.84 1,636.93 1.90 1.83 10 7.57 0.11 0.11 -8.10 -39.57
YHI INTERNATIONAL LTD 0.29 169.53 1.50 1.50 1 4.92 0.06 0.06 5.36 -6.45
YING LI INTERNATIONAL REAL ESTATE LTD 0.26 573.06 1.25 1.17 2 23.08 0.01 0.01 R+ -28.38
YONGNAM HLDGS 0.23 294.55 1.38 1.50 5 4.90 0.05 0.05 11.63 -7.84
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CAPITAL BONDS
India rule change to spur modest rise
in infrastructure bond inflows
Sept 22Foreign investment into Indian in-
frastructure debt will see a marginal pick-up
from the governments latest efforts to encour-
age it, although impediments including taxes
and a lack of short-term securities remain de-
terrents, market players said.
In a move to stimulate what have been anae-
mic foreign flows into infrastructure bonds, New
Delhi recently reduced the lock-up period on
such holdings to one year from three years for a
five-year bond for overseas institutions investing
up to US$5 billion in infrastructure bonds.
That comes on top of a move earlier this year
to lift the limit on foreign holdings of corporate
infrastructure bonds to US$25 billion from US$5
billion, in a bid to draw more investment into
much-needed roads, bridges and power plants.
This year through August, however, just
US$109 million of foreign funds had trickled into
corporate infrastructure bonds, out of total issu-
ance of US$8.6 billion, according to bankers.
India wants infrastructure investment of
US$1 trillion over five years starting next April
as it aims to boost economic growth to 10%
and raise living standards. Indias infrastruc-
ture ranks 89th out of 133 nations, according
to a World Economic Forum report.
Industry insiders said the new rule that
shortens the lock-in period for holdings is a
start, but more needs to be done to accelerate
investment in infrastructure bonds.
FIIs [foreign institutional investors] will be
more comfortable with a one-year lock-in than
three years, said Zafar Islam, head of financing
and rates sales at Deutsche Bank in India.
However, the key issues, such as withhold-
ing tax, are still unresolved and this needs to be
addressed to really provide a boost to FII partic-
ipation in the infrastructure space, he said.
Foreign investors pay withholding tax of
as much as 20%, depending on the tax treaty
India holds with the corresponding country.
A similar tax is applicable in many countries,
including Indonesia and South Korea.
Overseas investors said they find it tough to
meet targeted returns after the withholding tax,
given the credit profile of issuers in India.
Indias international sovereign credit rat-
ing of BBB-, nine notches below the top lev-
el, also deters foreign investors. Debt issued
by a firm that is highly rated locally is effec-
tively rated BBB- for global buyers, who thus
demand a higher return.
An investment in a 10-year government bond
in Brazil, which is rated one notch above India,
could yield 12% in Brazilian real to a foreign in-
vestor as no withholding tax is applicable, while
a bond in India of a similar tenure will draw
20% withholding tax and yield 6.75%.
With a rating of BBB-, India remains on the
brink of investment grade. There are countries
like Australia and South Africa which deliver
a better risk-adjusted return on their local cur-
rency debt, Praveen Jagwani, chief executive,
UTI International (Singapore) Pte Ltd, said.
A thin secondary market in shorter-tenor
Indian corporate debt also deters investment
by foreign funds. Most existing corporate in-
frastructure bonds are held by long-term in-
vestors like pension funds. Reuters
Singapore corporate bonds
ADB 0212 3.27 FEBRUARY 8, 2012 SGD 100.99 101.04 0.642 0.512 100.997 0:03:48 SEPTEMBER 22, 2011 DBSM
AREIT 0713 5 JULY 22, 2013 SGD 105.264 105.389 2.035 1.967 105.68 8:52:04 SEPTEMBER 22, 2011 DBSM
ASCENDAS 0414 5.15 APRIL 29, 2014 SGD 107.555 108.555 2.135 1.756 107.866 8:52:04 SEPTEMBER 22, 2011 DBSM
ASCOTT CAP 0514 5.15 MAY 28, 2014 SGD 108.297 109.297 1.942 1.577 108.619 8:52:04 SEPTEMBER 22, 2011 DBSM
ASCOTT CAP 0812 4.38 AUGUST 14, 2012 SGD 102.279 102.779 1.76 1.2 102.496 8:52:04 SEPTEMBER 22, 2011 DBSM
ASCOTT CAP 0912 3.58 SEPTEMBER 28, 2012 SGD 102.096 102.596 1.491 0.996 101.983 8:52:04 SEPTEMBER 22, 2011 DBSM
CAPITA TREA 1014 3.8 OCTOBER 30, 2014 SGD 105.999 106.999 1.799 1.478 106.101 8:52:04 SEPTEMBER 22, 2011 DBSM
CATHAY PAC 1111 0.776 NOVEMBER 9, 2011 SGD 100.009 100.01 0.7 0.692 100 0:07:05 SEPTEMBER 22, 2011 DBSM
CITY DEV 0412 3.38 APRIL 25, 2012 SGD 101.355 101.855 1.025 0.168 100.066 7:02:04 SEPTEMBER 22, 2011 DBSM
CITY DEV 1114 3.82 NOVEMBER 13, 2014 SGD 104.644 105.644 2.276 1.954 104.998 8:52:04 SEPTEMBER 22, 2011 DBSM
DBS 0721 4.47 JULY 15, 2021 SGD 106.923 108.423 2.915 2.593 108.633 8:40:02 SEPTEMBER 22, 2011 DBSM
DBS CAP PERP5.75 5.75 NA SGD 108.311 109.311 4.309 4.145 108 0:07:06 SEPTEMBER 22, 2011 DBSM
F&N 1015 3.62 OCTOBER 13, 2015 SGD 103.534 104.534 2.694 2.438 103.94 8:52:04 SEPTEMBER 22, 2011 DBSM
F&N TREA 0316 5.5 MARCH 18, 2016 SGD 111.377 112.377 2.781 2.558 112.776 8:52:04 SEPTEMBER 22, 2011 DBSM
F&N TREA 0612 3.405 JUNE 11, 2012 SGD 101.236 101.736 1.64 0.936 101.244 8:52:04 SEPTEMBER 22, 2011 DBSM
FCT 0612 4.8 JUNE 18, 2012 SGD 102.411 102.536 1.449 1.279 100.779 8:52:04 SEPTEMBER 22, 2011 DBSM
HDB 0212 3.42 FEBRUARY 14, 2012 SGD 101.182 101.189 0.393 0.376 101.19 0:03:48 SEPTEMBER 22, 2011 DBSM
HDB 0214 3.56 FEBRUARY 23, 2014 SGD 106.474 107.474 0.847 0.446 106.494 4:00:02 SEPTEMBER 22, 2011 OCBI
HDB 0316 3.73 MARCH 7, 2016 SGD 111.072 112.072 1.172 0.956 111.056 8:40:02 SEPTEMBER 22, 2011 DBSM
HDB 0619 3.35 JUNE 11, 2019 SGD 110.096 111.096 1.935 1.803 111.693 8:50:02 SEPTEMBER 22, 2011 OCBI
HDB 0712 1.795 JULY 3, 2012 SGD 101.055 101.555 0.433 -0.203 101.058 0:03:48 SEPTEMBER 22, 2011 OCBI
HDB 0713 3.455 JULY 15, 2013 SGD 104.213 104.713 1.097 0.826 105.538 5:14:19 SEPTEMBER 22, 2011 OCBI
HDB 0716 3.995 JULY 14, 2016 SGD 113.835 114.592 1.037 0.887 113.797 8:30:53 SEPTEMBER 22, 2011 BPHG
HDB 0718 3.95 JULY 15, 2018 SGD 113.763 114.763 1.794 1.649 114.009 8:20:03 SEPTEMBER 22, 2011 OCBI
HDB 1011 3.52 OCTOBER 31, 2011 SGD 100.013 100.014 3.347 3.337 100.014 0:03:48 SEPTEMBER 22, 2011 OCBI
HDB 0415 3.375 APRIL 21, 2015 SGD 108.291 109.291 1.009 0.738 105.513 5:14:18 SEPTEMBER 22, 2011 OCBI
HK LAND TSY 1015 3.65 OCTOBER 5, 2015 SGD 104.464 104.839 2.479 2.384 105.354 8:52:04 SEPTEMBER 22, 2011 DBSM
HSBC FINANC 0214 4.07 FEBRUARY 24, 2014 SGD 102.857 103.107 2.839 2.733 103.133 8:52:04 SEPTEMBER 22, 2011 DBSM
JOYNOTE 1011 3.76 OCTOBER 26, 2011 SGD 100.205 100.206 1.159 1.147 100.217 3:22:04 SEPTEMBER 22, 2011 DBSM
JTC 1012 4.826 OCTOBER 24, 2012 SGD 104.496 104.996 0.618 0.167 104.519 8:52:04 SEPTEMBER 22, 2011 DBSM
LTA 0613 2.159 JUNE 19, 2013 SGD 101.86 102.36 1.075 0.789 103.107 5:14:18 SEPTEMBER 22, 2011 DBSM
LTA 0512 4.08 MAY 21, 2012 SGD 102.262 102.277 0.641 0.618 102.271 0:03:48 SEPTEMBER 22, 2011 DBSM
LTA 0516 4.17 MAY 10, 2016 SGD 103.456 104.197 3.358 3.188 103.456 0:53:34 SEPTEMBER 20, 2011 DBSM
LTA 0623 2.9 JUNE 19, 2023 SGD 104.095 105.095 2.495 2.399 105.771 8:50:02 SEPTEMBER 22, 2011 DBSM
MAYBANK PERP 6 6 NA SGD 110.201 111.201 4.267 4.108 109.428 0:07:06 SEPTEMBER 22, 2011 DBSM
OCBC 5.1 NA SGD 106.099 107.099 1.707 1.176 104.719 8:52:04 SEPTEMBER 22, 2011 DBSM
OCBC 1117 3.78 NOVEMBER 28, 2017 SGD 101.693 102.13 2.311 1.937 102.156 0:07:05 SEPTEMBER 22, 2011 DBSM
OCBC CAPITAL 5.1 NA SGD 105.091 106.091 4.25 4.089 104.051 6:24:59 SEPTEMBER 22, 2011 DBSM
OCBC PERP4.5 4.5 NA SGD 102.675 103.675 2.448 1.703 102.566 8:52:04 SEPTEMBER 22, 2011 DBSM
OCBCCAP PERP3.93 3.93 NA SGD 96.946 97.946 4.897 4.577 96.563 6:25:00 SEPTEMBER 22, 2011 DBSM
ODFJELL 1211 4.15 DECEMBER 14, 2011 SGD 100.903 100.91 -0.074 -0.106 100.913 7:02:04 SEPTEMBER 22, 2011 DBSM
ODFJELL 1211 1.221 DECEMBER 14, 2011 SGD 93.842 95.58 5.2 4.14 93.842 8:15:46 FEBRUARY 24, 2010 DBSM
PSA CORP 0619 4 JUNE 5, 2019 SGD 111.642 112.642 2.339 2.205 111.018 8:52:04 SEPTEMBER 22, 2011 DBSM
PSA CORP 0715 2.83 JULY 6, 2015 SGD 104.977 105.977 1.469 1.205 105.48 8:52:04 SEPTEMBER 22, 2011 DBSM
PUB 0818 3.9 AUGUST 31, 2018 SGD 113.695 114.695 1.792 1.649 106.537 5:14:18 SEPTEMBER 22, 2011 OCBI
PUB 1014 3.095 OCTOBER 8, 2014 SGD 106.292 107.292 0.989 0.669 106.394 5:14:18 SEPTEMBER 22, 2011 OCBI
SEMB FINANC 0414 5 APRIL 21, 2014 SGD 108.543 109.543 1.591 1.214 108.905 8:52:04 SEPTEMBER 22, 2011 DBSM
SENGKANG 1112 4.88 NOVEMBER 20, 2012 SGD 100.175 100.675 4.727 4.278 100.197 8:52:04 SEPTEMBER 22, 2011 DBSM
SENGKANG 1112 8 NOVEMBER 20, 2012 SGD 106.559 108.148 5.581 5.02 106.559 8:54:44 NOVEMBER 25, 2009 DBSM
SP 0513 4.05 MAY 4, 2013 SGD 104.183 104.308 1.4 1.323 105.042 8:52:04 SEPTEMBER 22, 2011 DBSM
SIA 1211 4.15 DECEMBER 19, 2011 SGD 100.878 101.003 0.283 -0.255 100.886 7:02:04 SEPTEMBER 22, 2011 DBSM
SINGPOST 0413 3.13 APRIL 11, 2013 SGD 102.24 102.365 1.652 1.571 103.54 8:52:04 SEPTEMBER 22, 2011 DBSM
SINGPOST 1013 4.51 OCTOBER 14, 2013 SGD 98.095 100.043 5.059 4.498 98.095 8:54:48 NOVEMBER 25, 2009 DBSM
SMRT CORP 1211 3.27 DECEMBER 14, 2011 SGD 100.661 100.711 0.174 -0.056 100.667 7:02:04 SEPTEMBER 22, 2011 DBSM
SP 0412 0.359 APRIL 27, 2012 SGD 100.002 100.009 0.337 0.325 100.264 0:07:04 SEPTEMBER 22, 2011 DBSM
SP 0415 3.385 APRIL 27, 2015 SGD 105.802 106.802 1.709 1.431 106.565 8:52:04 SEPTEMBER 22, 2011 DBSM
SP 0815 4.19 AUGUST 18, 2015 SGD 109.721 110.021 1.603 1.528 109.892 8:52:04 SEPTEMBER 22, 2011 DBSM
SP 0820 4.665 AUGUST 18, 2020 SGD 113.375 114 2.946 2.872 115.455 8:32:04 SEPTEMBER 22, 2011 DBSM
SP 1012 2.8 OCTOBER 30, 2012 SGD 102.009 102.134 0.95 0.836 102.29 8:52:04 SEPTEMBER 22, 2011 DBSM
SP 1018 4.84 OCTOBER 22, 2018 SGD 114.979 115.479 2.517 2.446 116.201 8:52:04 SEPTEMBER 22, 2011 DBSM
ST TREA 0414 3.98 APRIL 2, 2014 SGD 105.137 106.137 1.88 1.486 105.434 8:52:04 SEPTEMBER 22, 2011 DBSM
UOB 0916 4.95 SEPTEMBER 30, 2016 SGD 100.107 100.482 3.113 3.032 100.111 0:07:04 SEPTEMBER 22, 2011 DBSM
UOB 0919 4.1 SEPTEMBER 3, 2019 SGD 104.878 105.378 2.374 2.202 105.782 4:00:02 SEPTEMBER 22, 2011 DBSM
UOB PERP5.05 5.05 NA SGD 105.122 106.122 2.371 1.867 103.629 8:52:04 SEPTEMBER 22, 2011 DBSM
Singapore benchmark bonds
YIELD LAST PRICE
SG1YT 0.19 99.884
SG5YT 0.531 102.65
SG10YT 1.585 105.95
US1YT 0.0981 0.0975
US5YT 0.8011 100
49
/51
US10YT 1.8063 102
7
/8
E
NAME COUPON (%) MATURITY DATE CURRENCY BID ASK BID YIELD ASK YIELD CLOSE PRICE TIME DATE CONTRIB REF
CAPITAL RIGHT TIMING
STIs support threatened
Markets have been relatively calm
despite the turmoil in the foreign
exchange markets. Note that the
Singapore dollar has weakened
dramatically against the US dol-
lar, as have other Asian currencies
such as the South Korean won.
It appears that in Asia, volatility
may be shifting from the equity
markets to currencies.
Interestingly, the Straits Times
Index, currently at 2,720, is still
above the low it reached in Au-
gust, which was 2,680 on an intra-
day basis. The 2,700 to 2,720 area
will likely be tested for a fifth time
shortly. As long-term indicators continue to fall,
a breakdown is probably a matter of time.

VIX (37.32) stays elevated
The VIX continues to stay at relatively high lev-
els. From a chart pattern point of view, it may
be forming a descending triangle if prices do
not break above 42. The bias is to the upside,
at present. The 30- and 65-day ROCs are rising,
adding upward pressure. During the week (Sept
15 to 21), the VIX bounced off its rising 50-day
moving average at 31. Descending triangles al-
most always turn out to be bearish formations,
but it remains to be seen if this one
is. A rising VIX means heightened
volatility and is inevitably negative
for equity markets.
Dow Jones Industrial
Average (11,124)
The worlds most watched barom-
eter is not quite in a downtrend,
although it has broken an uptrend.
Technical negatives are likely to
continue to weigh on the index.
The declining 50-day moving av-
erage at 11,610 is clearly acting as
a resistance line. Additionally, the
100- and 200-day moving averag-
es have just made a dead cross at 11,989. Also,
both the one- and three-month ROC indicators
have just turned down. The level to watch is
11,000. Prices are forming an ascending trian-
gle. The breakdown point for the triangle is at
the 10,970 to 11,000 range. Ascending triangles
are more often bullish formations. A breakdown
would indicate a target of 9,900. The psycho-
logical blow would be quite significant should
the Dow break below 10,000.
Standard & Poors 500 (1,166)
The S&P 500 like the Dow appears to be form-
Chart A Chart B Chart C
GETTING TECHNICAL
| BY MICHAEL KAHN |
W
ith major stock-market swings
hinging directly on the latest
news about the Greek debt
situation or what the US Federal Re-
serve might say or do, stepping out
for a sandwich has become an in-
creasingly risky proposition. Weve
seen more than our share of 2% to
3% intra-day moves as volatility re-
mains high.
How the market reacts in the
coming days to the plan announced
by the Fed on Sept 21 remains to be
seen. But if we strip out the day-to-
day movement, the weight of tech-
nical evidence is still on the side of
the bears.
To be sure, all major stock index-
es are higher now than they were a
month ago, despite more bad news
in housing and employment. And
superstar stocks such as Apple and
Alexion Pharmaceuticals continue
to notch 52-week highs.
But with economically sensitive
sectors in the market, such as heavy
machinery, industrial metals and rare-
earth mineral stocks breaking down,
we dont think the stock market has
much left in its tank.
Just take a look at an economic
bellwether such as Freeport-McMo-
Ran Copper & Gold. Not only has it
moved below a short-term support
level, but it has lost close to 40% of
its value since the start of the year. It
tagged a 52-week low on Sept 21 in
stark contrast to the sexier 52-week
highs of Apple and others.
Banks, whether directly involved
in the European debt crisis or not,
continue to lag the broad market.
Even domestically focused banks
have been hit, as evidenced by the
performance of the SPDR KBW Re-
gional Banking exchange-traded
fund. It had already been underper-
forming the market since the start of
the year and fell even further
behind in August.
In other words, what was al-
ready bad got worse. It is hard
to imagine a new bullish trend
beginning without contribution
from this sector.
Another more recent tech-
nical problem for the market
is the lagging performance of
small-capitalisation stocks.
When the market is feeling
perky, small stocks usual-
ly lead bigger stocks higher.
Conversely, when the market
is more worried, small stocks lead
to the downside falling more
than big stocks.
During the choppy advance from
respective August lows, however,
small stocks have lagged. The rela-
tive performance chart of the Rus-
sell 2000 small-cap index versus the
Standard & Poors 500 Index is head-
ing lower (see chart).
And even though the Russell 2000
edged its bigger-cap cousin in raw per-
formance the week of Sept 12 with
a 5.9% gain versus 5.3%, it showed
technical failure on the charts.
The S&P 500 was able to close that
week within a fraction of its late-Au-
gust high. The Russell stopped short
by a significant 1.7%. It seems like a
small percentage, but it still speaks
volumes. Small stocks are lag-
ging big stocks, and that is not
usually good for the market.
The recent all-time low set
by the two-year Treasury note
yield and upside breakout by
the Market Vectors ETF Trust
Market Vectors Gold Miners
add another dimension to the
bearish argument. Money is
fleeing economically sensitive
areas and rushing to areas of
perceived safety.
Regardless of how the mar-
ket digests the Feds latest plan,
it will likely matter only for a short
time. Last years bull market in stocks
is over investors will have to ad-
just accordingly.
Michael Kahn is the author of three
books on technical analysis, most re-
cently A Beginners Guide to Charting
the Financial Markets, and was chief
technical analyst for BridgeNews
Bears sharpen their claws
ing an ascending triangle as well. The break-
down point at which the formation would no
longer be valid is at 1,150. Prices are beneath
all the moving averages. However, three-month
ROC could be in the early stages of an uptrend.
Resistance is at 1,200.
Hang Seng Index (17,911)
This index broke below a several times-tested
support at 18,600 and on Sept 22, it fell below
the psychological 18,000 level. The breakdown
points to a target of 16,000. The Hang Seng In-
dex has lost 20% year-to-date, underperform-
ing the STI, and the US markets.
STI (2,720)
Long term: down; medium term: sideways;
short term: down

Short term
RSI (Chart B) looks set to retreat from resist-
ance at its equilibrium lines.
ADX (Chart B) is falling and the DIs are neg-
atively placed.
Stochastics (Chart B) is falling.
Medium term
Quarterly momentum (Chart A) remains flat.
Long term
Annual momentum (Chart C) is falling.
24-month ROC (Chart C) is falling.
The fast-moving short-term indicators are falling
currently, with 5-day stochastics likely to reach a
low soon, and attempting a rebound sometime in
the week of Sept 26 to 30. Increasingly, it appears
likely that the STI, returning to its four times-test-
ed support area at 2,680 to 2,700, could move
below this level. Twenty-one-day RSI is turning
down from resistance and this may have a more
adverse effect on the STI as it falls. ADX con-
tinues to fall, and that is the main saving grace.
A falling ADX means that the downtrend of the
index is unlikely to be strong.
For the past two months, the STI has been
rangebound between 2,700 and 2,900. As long-
term indicators are declining, it is more likely
that the low end of the range is breached. Both
24-month ROC and annual momentum show no
change in direction and continue to fall. Annual
momentum has just moved below its equilibri-
um line, setting off a negative event.
So far, support has been established at the
2,680 to 2,700 range. Note that the earlier break
below the twice-tested 2,919 indicates an even-
tual target of 2,500, based on the bar and can-
dlestick charts. Based on the measured move
methods, a break below 2,680 would indicate
a new downside of 2,440. Hence, its pretty
crucial that 2,680 holds out.
E
E
| BY GOOLA WARDEN |
Oct 18, 2010 Sept 19, 2011
Russell 2000
E
S
IG
N
A
L
850.00
800.00
750.00
700.00
650.00
60
57.27
($RUT,D) Dynamic,
0:00-24:00 (Delayed)
Relative performance vs S&P500
CAPITAL HOT STOCKS
DBS ($12.10) Trying to find a low
In times of capital flight as some strategists are talking about now the first in
the firing line tend to be banks and property stocks. The latter has already been fall-
ing, since as early as November 2010, and several stocks have actually found supports.
However, none are really near their global financial crisis lows. Banks, on the other
hand, had retained their strength for the best part of this year, and were only impact-
ed in mid-August, as the euro crisis worsened. The problem is, on the weekly charts,
banks and properties could have further downside, short-term temporary rallies not-
withstanding.
FRASER & NEAVE ($5.70) Retreating from resistance
KEPPEL LAND ($2.82) Testing support
Short-term oversold pressures will probably only provide temporary respite from the de-
cline. Otherwise, all three moving averages are falling after forming dead crosses in Au-
gust. On the weekly chart, prices broke below a top formation at the several times-tested
neckline at $13.50, and the breakdown indicates a target of $11.50, which is fast ap-
proaching. Recall that the low during the global financial crisis was $6.30, and this sug-
gests just how low prices could go. A move above $13 would stem the downtrend but
this appears remote.
OCBC ($8.13) Still trending down
Short-term oversold pressures may trigger a temporary bounce as prices approach the psy-
chological $8 level. Overall, the downtrend has yet to run its course as moving averag-
es, medium- and long-term momentum, and directional indicators all suggest that prices
have not found a low yet. The weekly chart shows that prices broke down below a dou-
ble-top formation at $8.60. The breakdown indicates a target of $6, above the global fi-
nancial crisis low of $4.50. As annual momentum moves below its equilibrium line, the
decline could gather momentum. Any rebound will likely find resistance at the break-
down level of $8.60.
This counter has yet to bottom. In the near term, it may have found temporary support
near current levels (of $2.82) at $2.86. However, quarterly momentum is turning down
again after a half-hearted attempt at a rebound. Meanwhile, annual momentum contin-
ues to fall, and ADX is set to turn up, suggesting that $2.86, which is barely holding,
could be breached definitively. As this level, a measuring objective indicates a target of
close to $2.
UOB ($17.33) No shelter from the storm
Of the three banks, this one has fallen the least this year, making it in technical terms
the one with the greatest relative strength. The daily chart, however, does not tell the full
picture. Prices appear poised to break below support at $17.20 to $17.50. On the weekly
chart, such a breakdown indicates a target of $14. Quarterly momentum is now falling
while ADX is rising with negatively placed DIs. That will pressure prices. The low reached
during the global financial crisis was $8.50.
CAPITALAND ($2.52) Gains relative strength
Despite the huge sell-off in the market during the Sept 19 to 22 period, this counter has
barely budged. Diminishing volume plus narrow movements are indicative of a bottom-
ing out for this counter. Additionally, there are signs that quarterly momentum is attempt-
ing to strengthen, as evidenced by the indicators series of higher highs and higher lows.
Also, ADX has been falling, and is now at 10, a low level which indicates that the down-
trend has halted. The DIs are neutral and would only need prices to stay in the $2.52 to
$2.56 range for them to turn positive. Near-term moves will likely be sideways, as part of
the base formation. Support has been established at the $2.38 to $2.43 range.
Banks and properties in ring line
With quarterly momentum having risen above its equilibrium line, this counter probably
has greater relative strength than the broad market. Prices are now testing a confluence
of resistance at the declining 50- and 100-day moving averages at $5.75 and $5.83. Since
the market is so weak, it is unlikely that one counter can move against the tide. Support
has been established at $5.40, and this should hold since ADX is at a low level, and there
is no pronounced trend. With the bias in the market to the downside, $5.40 needs to be
watched carefully because a breakdown would indicate a measuring objective of $4.80.
CAPITAL TRADING IDEAS
T
he eurozone and the US have signifi-
cant problems, with insipid economic
recoveries and sovereign debt issues.
Governments are tinkering around the
edges with almost permanently low
interest rates and austerity measures. Misery
loves company. There is a tendency to cast the
same gloomy light on the analysis of all com-
petitors, tarring them with the same brush and
subjecting them to views through
the same gloomy lens.
The Shanghai Index has fallen
some 20% from its April highs.
Industrial production has fallen
from 15.5% to 13.5% and this
is reason enough to talk down
the China market with the same
metrics applied to European and
US economies. It is misinformed
application that fails to recognise
the essential differences between
the Chinese and Western econo-
mies. For investors, this provides
good investment opportunities as
companies that do business with
China are sold down on this misinformation.
This includes resource companies, manufactur-
ers and exporters, some of which are trading
at attractive lows.
Western economies have the problem of
initiating growth. They flood the system with
money, QE2 and some form of QE3 and have
kept interest rates at close to zero. Despite this,
unemployment remains stubbornly high at 9%
in the US. China has the opposite problem. It
has to reduce the speed of growth to tackle in-
flation. This includes raising interest rates, in-
creasing bank reserve ratios and applying other
methods to restrain a growing economy.
When Chinese growth slows, it is not a
sign of economic collapse it is a sign of a
controlled soft landing and there is no need
for alarm. When US growth slows, it is at the
other end of the growth spectrum and a sign
of significant problems.
The fall in consumer price index inflation to
6.2% in August, from 6.5% in July, may sig-
nal that the peak in inflationary pressure has
passed. Some suggest a move towards 5% in-
flation or less in the coming months. It will
take another few months of reduced inflation
figures before China begins to reduce the hold
on bank reserves and interest rates. Lower in-
flation in China will change policy settings and
Beijing has shown it has the flexibility to act
quickly as conditions change.
Western economies are des-
perately trying to resuscitate their
economies. China is simply slow-
ing economic growth to achieve
acceptable growth levels that bal-
ance the pressure of inflation and
sustainable growth. It is the sus-
tainability and quality of growth
that is a key feature of the cur-
rent five-year plan and the Shang-
hai Index will reflect this slower
but more sustainable market en-
vironment.
A reduction and end to Chi-
nas monetary tightening has the
potential to create a market rally
with a 20% upside, or more. This is a move from
support at around 2,300 to resistance at around
2,800. This takes the market back to July highs
and leaves the higher April highs near 3,000,
well within reach for a 30% return. Investors
are waiting for evidence support that can hold
and develop a base for a market recovery. This
support relies on the success in reducing infla-
tion and the attendant marginal reduction in the
speed of growth.
Technical support on the Shanghai Index is
near 2,300. This is a long-term historical support
and the market is moving slowly towards a test
of this level. Investors pay close attention to the
behaviour of the Shanghai Index as it moves to-
wards this level. A successful test of this level
may develop in several behaviour patterns.
The technical support level is between 2,300
and 2,330, which is a narrow support consol-
idation band. Support is most effective when
it has developed historically. The market re-
bound from 2,437 on Aug 9 was not a rebound
from a historical support, so this increases the
probability the market will fall lower to the his-
torical support consolidation band.
The first, strongest and most powerful be-
haviour pattern is a V-shaped rebound. This
develops when the index touches 2,300 and
then rapidly develops a fast rally rebound that
quickly moves above 2,600. This is similar to
the Shanghai Indexs V-shape rebound in Au-
gust 2008. It is also similar to the strong rally
rebound that developed in July 2010. The Shang-
hai Index has a strong history of V-shaped re-
bound behaviours, so aggressive investors will
be ready to enter the market when there is evi-
dence of a rally rebound from near 2,300.
The second behaviour pattern is the L-shape
consolidation. This develops when the market
tests and retests support. The upside for the re-
bound rally behaviour is limited. This creates
a short-term rally and retreat behaviour. This
is difficult to trade because the up and down
moves are very rapid. This consolidation cre-
ates a foundation for an uptrend breakout.
In this behaviour pattern, the long-term
Guppy Multiple Moving Averages begin to com-
press. This shows the shift in investor thinking
as they stop selling and start to become buyers.
Investors look for evidence of GMMA compres-
sion to show there is an increased probability
of change to an uptrend.
The third feature is the potential development
of a Relative Strength Indicator (RSI) divergence
pattern. This develops when there are two sig-
nificant valley lows in the Shanghai Index. The
low of Aug 9 is the first significant valley low
in this pattern. This has not developed yet. The
significant low is shown when the market cre-
ates a new retreat and rally valley low pattern
with a low of below 2,440. After this, investors
will look for a diverging direction in the trend
line on the RSI indicator. This will confirm an in-
creased potential for a consolidation and change
in trend direction.
Daryl Guppy is a well-known international fi-
nancial technical analysis expert. For more than
four years, he has provided weekly Shanghai In-
dex analyses for Shanghai Security News and
other mainland Chinese media. Guppy appears
regularly on CNBC Asia and is known as The
Chart Man. He is a national board member of
the Australia China Business Council.
Chinas slowing growth is not no growth
| BY DARYL GUPPY |
E
| BY SORAYA PERMATASARI &
JESSE RISEBOROUGH |
I
ron ore is set for the first four-
year drop since at least 1982 as
supplies surge, threatening to end
record earnings at Vale SA, Rio Tin-
to Group and BHP Billiton Ltd, the
worlds biggest producers.
Global prices may fall 29%
to an average US$123 a tonne in
2015 from a record US$173 this
year, according to the median es-
timates of 10 analysts surveyed
by Bloomberg News. The decline
contrasts with estimates for little
change in copper and a 10% in-
crease for aluminium in the same
period, London Metal Exchange
futures prices show.
Iron ore supplies for export will
jump 53% by 2015 even as slower
growth in Chinese steelmaking saps
demand, Goldman Sachs & Partners
Australia Pty says. That will reduce
prices and profit that reached records
this year for BHP and Brazils Vale,
whose net income will fall almost
50% by mid-decade, according to
data compiled by Bloomberg.
Iron ore is the largest single
contributor to profits for these large
mining companies, Tony Robson,
an analyst at BMO Capital Mar-
kets in Toronto, said by telephone.
Should sagging prices offset rising
shipments, total profitability will
be reduced, he says.
Rio Tintos shares fell 6.5%, the
most in more than two years, to
close at A$65.10 on the Australian
stock exchange. BHP dropped 4%,
its biggest decline in a month.
The three producers together sup-
ply about 62% of the seaborne mar-
ket, the largest platform for global
trade, says UBS AG. The turnabout
caps two years of price gains for the
main ingredient in steelmaking that
spurred them and Chinese-financed
operators to dig new mines in Aus-
tralia, Brazil and Africa.
BHP is spending US$7.4 billion
($9.55 billion) on its operations in
Western Australias Pilbara region
to boost output 64% to 220 mil-
lion tonnes by 2014. Rio is studying
spending about US$15 billion on ex-
panding annual capacity in the re-
gion by about 50% by 2015.
World trade in iron ore is forecast
to gain 8% next year to 1.2 billion
tonnes, with China expected to ac-
count for the largest share, Austral-
ias Bureau of Resources and Energy
Economics said recently in a report.
Meanwhile, the pace of growth in
steel demand in China, the biggest
ore buyer, may ease to 2.6% annu-
ally through 2015 from the 4.6%
forecast for this year, as its econ-
omy slows, the China Iron & Steel
Association said in April.
Come 2014 and 2015, we expect
a continuing flattening of Chinese
steel production, Peter Hickson, glo-
bal head of commodity research at
UBS, said in an interview. Theres
easing of demand growth, but cer-
tainly the primary issue is emergence
of significant new supply.
Citigroup Inc has estimated a
surplus of 50.6 million tonnes of
iron ore in 2014, rising to 100.8
million tonnes the following year,
driven by increased output capac-
ity. Annual growth in global steel
production will slow to 3.2% in
2015 from 8.6% this year, Morgan
Stanley said in July.
At Rio, earnings before interest
and tax from iron ore are forecast to
drop to US$11 billion in 2015 from
an expected peak of US$21.3 bil-
lion next year, Deutsche Bank AG
said on Aug 4. Iron ore provided
almost two-thirds of the London-
based companys 2010 earnings be-
fore interest, tax, depreciation and
amortisation (Ebitda).
At BHP, where iron ore com-
prised 26% of Ebitda in fiscal 2010,
the earnings will peak at US$16 bil-
lion in 2013, before falling to US$11.6
billion in 2015 and US$7.9 billion in
2016, Bank of America Corp said
in a report. Overall Ebitda will drop
25% in the five years through 2016,
the bank forecast.
We think that the growth in Chi-
nese steel production will ease over
the next few years and that the iron
ore supply side will catch up, move
into oversupply and prices fall,
Goldman Sachs analyst Neil Good-
will said in a Sept 9 report.
Iron ore for immediate delivery
was US$177.40 a tonne on Sept 20,
according to a price index com-
piled by The Steel Index Ltd. The
price reached a record US$191.90
on Feb 16. Kelly Quirke, a spokes-
woman for BHP, and Karen Hal-
bert, a spokeswoman for Rio, de-
clined to comment on the iron ore
outlook.
China has been on a decade-long
drive to break the stranglehold of
Rio, BHP and Vale by bankrolling ri-
val mines. Chinese investors, mainly
state-owned steelmakers, have fund-
ed at least 20 iron ore companies
in Australia including Sundance Re-
sources Ltd, Fortescue Metals Group
Ltd and Mount Gibson Iron Ltd.
In August, Shandong Iron & Steel
Group Co agreed to buy a 25% stake
in African Minerals Ltds Tonkolili
project in Sierra Leone for $1.5 bil-
lion. Bloomberg LP
Iron ores longest slide since 1982 threatens mining earnings
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SHAREHOLDERentitlements
Announced dividends and capital issues: Sept 19 to Dec 12, 2011 (by ex-date)
COMPANY TYPE PARTICULARS EX DATE RECORD DATE PAID/PAYABLE
F&N TREASURY $220M 2.48% 160328 Interest 280311-270911 3.15% Sept 19, 2011 Sept 21, 2011 Sept 28, 2011
F&N TREASURY $220M 2.48% 160328 Interest 280311-270911 2.48% Sept 19, 2011 Sept 21, 2011 Sept 28, 2011
DYNA-MAC HOLDINGS Dividend $0.02 one-tier tax Sept 19, 2011 Sept 21, 2011 Oct 6, 2011
ASPIAL CORP LTD Bonus Offer of 1 for 1 Sept 19, 2011 Sept 21, 2011
FRASERS CENTREPOINT TRUST Dividend Approximate $0.0201 less tax Sept 20, 2011 Sept 22, 2011 Nov 8, 2011
SIA $300M 2.15% B150930 Interest 300311-290911 2.5% Sept 21, 2011 Sept 23, 2011 Sept 30, 2011
CDW HOLDING LTD Dividend US$0.003 Sept 22, 2011 Sept 26, 2011 Oct 7, 2011
TECHNICS OIL & GAS LTD Dividend $0.03 one-tier tax Sept 26, 2011 Sept 28, 2011 Oct 10, 2011
SHANGRI-LA ASIA LTD Dividend HK$0.10 Sept 26, 2011 Sept 28, 2011 Oct 10, 2011
OCEAN SKY INTERNATIONAL LTD Dividend $0.008 one-tier tax Sept 26, 2011 Sept 28, 2011 Oct 13, 2011
OXLEY HOLDINGS LTD Dividend $0.0045 one-tier tax Oct 3, 2011 Oct 5, 2011 Oct 21, 2011
AVJENNINGS LTD Dividend Fully franked AU$0.0015 Oct 3, 2011 Oct 5, 2011 Oct 19, 2011
TPV TECHNOLOGY LTD Dividend US$0.0063 Oct 4, 2011 Oct 6, 2011 Oct 14, 2011
LIAN BENG GROUP LTD Dividend $0.006 one-tier tax Oct 4, 2011 Oct 6, 2011 Oct 19, 2011
LIAN BENG GROUP LTD Dividend $0.01 one-tier tax Oct 4, 2011 Oct 6, 2011 Oct 19, 2011
CHASEN HOLDINGS LTD Dividend $0.006 one-tier tax Oct 5, 2011 Oct 7, 2011 Oct 18, 2011
SINGAPORE EXCHANGE LTD Dividend $0.15 tax-exempt Oct 11, 2011 Oct 13, 2011 Oct 24, 2011
YUEXIU PROPERTY CO LTD Dividend HK$0.04 Oct 13, 2011 Oct 17, 2011 Nov 18, 2011
UNITED OVERSEAS AUSTRALIA LTD Dividend Unfranked, DRP A$0.005 Oct 13, 2011 Oct 17, 2011 Oct 31, 2011
GUOCOLEISURE LTD Dividend $0.02 Oct 18, 2011 Oct 20, 2011 Nov 3, 2011
TEE INTERNATIONAL LTD Dividend $0.0125 one-tier tax Oct 19, 2011 Oct 21, 2011 Nov 2, 2011
SILVERLAKE AXIS LTD Dividend $0.004 one-tier tax Oct 19, 2011 Oct 21, 2011 Nov 11, 2011
GUOCOLAND LTD Dividend $0.08 one-tier tax Oct 20, 2011 Oct 24, 2011 Nov 10, 2011
RYOBI KISO HOLDINGS LTD Dividend $0.006 one-tier tax Oct 24, 2011 Oct 27, 2011 Nov 11, 2011
ELLIPSIZ LTD Dividend $0.0013 one-tier tax Oct 25, 2011 Oct 28, 2011 Nov 16, 2011
ELLIPSIZ LTD Dividend $0.0015 one-tier tax Oct 25, 2011 Oct 28, 2011 Nov 16, 2011
KARIN TECHNOLOGY HOLDINGS LTD Dividend HK$0.07 Oct 27, 2011 Oct 31, 2011 Nov 10, 2011
BRITISH & MALAYAN TRUSTEES LTD Dividend $0.035 tax-exempt Oct 27, 2011 Oct 31, 2011 Nov 10, 2011
SINGAPURA FINANCE LTD Dividend $0.02 one-tier tax Oct 28, 2011 Nov 1, 2011 Nov 11, 2011
SINGAPURA FINANCE LTD Dividend $0.06 one-tier tax Oct 28, 2011 Nov 1, 2011 Nov 11, 2011
SIN GHEE HUAT CORP LTD Dividend $0.012 one-tier tax Oct 31, 2011 Nov 2, 2011 Nov 15, 2011
BOARDROOM LTD Dividend $0.02 one-tier tax Oct 31, 2011 Nov 2, 2011 Nov 18, 2011
SPINDEX INDUSTRIES LTD Dividend $0.009 one-tier tax Nov 1, 2011 Nov 3, 2011 Nov 18, 2011
ASL MARINE HOLDINGS LTD Dividend $0.015 one-tier tax Nov 1, 2011 Nov 3, 2011 Nov 16, 2011
K1 VENTURES LTD Dividend $0.005 one-tier tax Nov 2, 2011 Nov 4, 2011 Nov 16, 2011
MICRO-MECHANICS (HOLDINGS) LTD Dividend $ 0.02 one-tier tax Nov 3, 2011 Nov 8, 2011 Nov 22, 2011
C&O PHARM TECH (HOLDINGS) LTD Dividend $0.0047 Nov 3, 2011 Nov 8, 2011 Nov 25, 2011
OLAM INTERNATIONAL LTD Dividend $0.05 one-tier tax Nov 4, 2011 Nov 9, 2011 Nov 18, 2011
FJ BENJAMIN HOLDINGS LTD Dividend $0.02 one-tier tax Nov 4, 2011 Nov 9, 2011 Nov 22, 2011
EU YAN SANG INTERNATIONAL LTD Dividend $0.012 one-tier tax Nov 4, 2011 Nov 9, 2011 Nov 24, 2011
EU YAN SANG INTERNATIONAL LTD Dividend $0.01 one-tier tax Nov 4, 2011 Nov 9, 2011 Nov 24, 2011
AVI-TECH ELECTRONICS LTD Dividend $0.0025 one-tier tax Nov 4, 2011 Nov 9, 2011 Nov 24, 2011
AMTEK ENGINEERING LTD Dividend $0.055 one-tier tax Nov 4, 2011 Nov 9, 2011 Nov 22, 2011
CHOSEN HOLDINGS LTD Dividend $0.0066 one-tier tax Nov 8, 2011 Nov 10, 2011 Nov 23, 2011
PEC LTD Dividend $0.01 one-tier tax Nov 9, 2011 Nov 11, 2011 Nov 25, 2011
PEC LTD Dividend $0.02 one-tier tax Nov 9, 2011 Nov 11, 2011 Nov 25, 2011
TEE INTERNATIONAL LTD Dividend $0.005 one-tier tax Nov 11, 2011 Nov 15, 2011 Dec 6, 2011
KIAN ANN ENGINEERING LTD Dividend $0.00775 one-tier tax Nov 11, 2011 Nov 15, 2011 Nov 30, 2011
FUJIAN ZHENYUN PLAS IND CO LTD Dividend RMB0.0231 tax-exempt Nov 11, 2011 Nov 15, 2011 Nov 30, 2011
HUPSTEEL LTD Dividend $0.005 one-tier tax Nov 15, 2011 Nov 17, 2011 Nov 30, 2011
DATAPULSE TECHNOLOGY LTD Dividend $0.018 one-tier tax Nov 28, 2011 Nov 30, 2011 Dec 9, 2011
AUSGROUP LTD Dividend $0.0064 one-tier tax Dec 12, 2011 Dec 14, 2011 Dec 30, 2011
Monday, Sept 26
Singapore
Industrial Production (y-o-y, Aug)
Lian Beng Group Ltd AGM
US New Home Sales (Aug)
Wednesday, Sept 28
US MBA Mortgage Applications
Thursday, Sept 29
US Personal Consumption (2QT)
US GDP Price Index (2QT)
Friday, Sept 30
Singapore
Bank Loans & Advances (y-o-y, Aug)
M1 Money Supply (y-o-y, Aug)
M2 Money Supply (y-o-y, Aug)
Ace Achieve Infocom Ltd AGM
JETS Technics Intl Holdings Ltd AGM
Surface Mount Tech (Holdings) Ltd AGM
Van Der Horst Energy Ltd AGM
TT International Ltd AGM
US Personal Income (Aug)
US Personal Spending (Aug)
TA Corp Ltd
Core business: The group is principally
engaged in: (i) the development and sale
of residential and other types of proper-
ties; and (ii) the construction business
(including complementary services such
as steel fabrication and metal works, a
worker training and test centre in Chen-
nai, India, as well as the design, installa-
tion and maintenance of air-conditioning
and mechanical ventilation systems).
Status: Lodged (preliminary prospec-
tus)
Lodged date: Sept 22
Underwriter: China Construction Bank
Corp, Singapore branch; United Over-
seas Bank Ltd
Issue manager: China Construction Bank
Corp, Singapore branch
Invitation size: NA
Public offer: NA
Invitation price: NA
CORPORATE/
CAPITAL MARKETS
Sept 26
Topic: IPv6 Forum Certified Network
Engineer Courses (Silver & Gold)
Highlights: IT managers, engineers
and users can learn to maintain
interoperability and facilitate a smooth
transition of the IP protocols across their
networks; the training will cover IPv6
addressing, ICMPv6, IPv6 Neighbour
Discovery, Transition Approaches and
Mechanisms, Mobile IPv6, Security, QoS
and others
Venue: 62 Burn Road, 05-01 TSH Centre
Organiser: PROGRESO Networks
Tel: 6509 9600
Email: ipv6@progreso.com.sg
Website: www.progreso.com.sg
Sept 27
Topic: Is gold still a buy? How to invest
and trade in the gold market?
Time: 7pm to 8pm
Venue: Raffles City Tower, Level 7
Organiser: Phillip Futures
Tel: 6538 0500
Registration: www.phillipfutures.com.sg
Sept 28 and 29
Topic: Singapore Human Capital Summit
Highlights: Insights from a global
perspective driving business
performance through human capital;
research on Asia the future of work;
talent masters for a strong leadership
pipeline in Asia; accelerating talent
development in global Asia
Venue: Resorts World at Sentosa
Organisers: Ministry of Manpower,
Singapore Workforce Development Agency,
Human Capital Leadership Institute
Tel: 6513 8798
Email: secretariat@singaporehcsummit.
com
Website: www.singaporehcsummit.com
Sept 30
Topic: NUS-ISS Service Innovation
Leadership Series Value Co-Creation
in Our Interconnected World
Highlights: Better engage stakeholders
and customers in an increasingly
interconnected world; integrate theory
and real-world practices to develop
innovation initiatives; develop innovation
strategies to grow marketshare
Time: 9am to noon
Venue: Institute of Systems Science,
25 Heng Mui Keng Terrace
Organisers: National University of
Singapore, Institute of Systems Science
Tel: 6516 7646
Registration: www.iss.nus.edu.sg
Oct 1
Topic: Investing in Fixed Income Securities
Highlights: Bond basics key bond
terminologies, concepts and features;
types of bonds; why invest in bonds;
overview of the Singapore bond market;
yield-curve analysis
Time: 2pm to 4pm
Venue: SGX Auditorium, Level 2,
SGX Centre 1
Organiser: SGX Academy
Tel: 6327 5438
Registration: register@sgxacademy.com
Website: www.sgxacademy.com
Oct 5
Topic: Latin Asia Business Forum 2011
Highlights: Strengthening the Latin
America-Asia partnership; trade and
economic policy in the Latin American
decade; emerging engines of growth
in Latin America; riding the Asian wave
doing business in Asia
Venue: Grand Hyatt, Singapore
Organiser: IE Singapore
Email: enquiry@latinasiabiz.com
Registration: www.latinasiabiz.com
Oct 6
Topic: CPA Congress
Highlights: Business forum strength
through experience versus the new
paradigm; leadership forum strength
through experience, a personal reflection;
business forum reshaping business
for a sustainable future
Time: 9am to 4.45pm
Venue: Swissotel, The Stamford
Organiser: CPA Australia
Tel: 6671 6500
Email: sg@CPAAustralia.com.au
Website: www.cpacongress.com.
au/singapore
Oct 8
Topic: A Guide to Futures Trading
Highlights: The futures market; trading
futures contracts; understanding trading
systems; trading/training programmes;
trading communities
Time: 9.30am to 12.30pm
Venue: SGX Auditorium, Level 2,
SGX Centre 1
Organiser: SGX Academy
Tel: 6327 5438
Registration: register@sgxacademy.com
Website: www.sgxacademy.com
Oct 8
Topic: ETF Expos: There is Nothing to
Hide
Highlights: Experience a vigorous
discussion among expert speakers from the
four major issuers on the various structures
of exchange-traded funds, concerns
regarding synthetic and non-synthetic
ETF replication techniques, market trends
of ETF structure, as well as learn from a
market practitioner on the usage of ETFs
in an actively managed portfolio
Time: 2pm to 5pm
Venue: Raffles City Convention Centre,
Stamford Ballroom
Organiser: OCBC Securities
Tel: (1 800) 338 8688
Email: productsgroup@ocbcsec.com
Website: www.iocbc.com
Oct 22
Topic: SIM Interest Group Convention
2011
Highlights: Join us to learn about the
latest industry trends, best practices
and inspiring experiences from leading
professionals, in this most significant and
power-packed event for all SIM Interest
Groups each year. SIM interest groups
its the network that works!
Time: 9am to 5pm
Venue: Marina Mandarin Singapore
Organiser: Singapore Institute of
Management
Tel: 6248 9449
Email: siminterestgroup@sim.edu.sg
Website: www.sim.edu.sg/igc
Compiled by Rahayu Mohamad
PubIIshed by 7KH(GJH3XEOLVKLQJ3WH/WG 1o CecII SLreeL #1-oo SInguore o6qqPrInLed by .+/3ULQWLQJ&R3WH/WG ; oyung DrIve SInguore o8q68
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