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Stocks In Focus SG (SGX, Yangzijiang, DBS) – 04/10/13
Analysts On Two Ends Of The Bridge On SGX’s September Trade Data
Singapore Exchange’s (SGX) trade data for the month of September has effectively put analysts on two opposing ends of a bridge as they decode the released numbers. The numbers for the month of September shows a flattish month marked by penny dominated trading. Although the daily average volume on the SGX soared to five billion shares in September, compared to that of 1.8 billion shares a year ago, the securities daily average value (SDAV) was just one percent higher year-on-year at $1.4 billion. OCBC head of research, Carmen Lee noted that the average value per traded share of about 37 cents during the quarter is close to recent lows. She felt that securities revenue should come off for the quarter, which is hopefully partially mitigated by slightly better listing fees. Analyst Ken Ang, of Phillip Securities however thinks that the year-on-year securities revenue should be higher, despite the lower SDAV. He quipped that Phillip Securities see equities as a strong asset class that will gain more interest, despite acknowledging the fact that markets might be quieter in the near term relative to the start of the year.
Significance: Despite the two differing house of thoughts from the two houses, it remains largely to be seen how these numbers released will translate into dollars and cents at SGX, which will report its fiscal first-quarter results for the three months ended September on 17 October.
US$1b Worth Of New Deals Bagged By Yangzijiang In 3Q13
Yangzijiang Shipbuilding have, since the start of September, secured 25 new contracts and is well on its way to meeting a higher volume of orders in order to maintain its profit levels. Eight contracts were announced by the Singapore listed shipbuilder last month, worth some US$214 million, which was followed up with another 17 deals this week worth some US$871 million. These jobs have effectively taken Yangzijiang’s total orders won to US$1.09 billion in 3Q13 alone. Macquarie Equities Research observed that Yangzijiang has been gravitating towards building larger vessels and higher-value products. Macquarie’s analysts added that after analysing the order books of top regional yards, they found Yangzijiang to be one of the few to still have available slots for delivery in 2015.
Significance: Yangzijiang’s strong order book and replenishment can be attributed partly to the consolidation of the Chinese shipbuilding industry. Macquarie upgraded its rating to “Outperform” and raised its target price to $1.45 from $0.85 on the prospects of a stronger pipeline of new orders to the tune of US$2.3 billion for 2013.
DBS Steps Up Fresh Graduates And Diploma Holders Hirings
DBS Bank revealed that it will be hiring some 200 fresh graduates and polytechnic diploma holders as it steps up in-house training to groom staff as part of a strategy to attract and retain talent. DBS spokeswoman Edna Koh said the bank aims to recruit more than 200 graduates for the six programmes combined this year. The programmes, aimed at diploma and degree holders who have graduated recently will groom people aspiring to build careers in retail banking, small and medium-sized enterprise (SME) banking, and customer service. It was revealed that the candidates for the programmes will be on a fast track, where typically banks annually hire a small group of graduates they regard as an elite core which then goes on to form its top ranks.
Significance: As part of DBS’s strategy to be a leading player in both consumer and SME banking, this commitment to recruit and groom people from the emerging talent pool in Singapore will bode well with its strategic goal. Collectively, the bank received more than 7,000 applications last year for its existing management associate and graduate associate program.
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