DBS GROUP HOLDINGS LTD D05.SI DBS Group Holdings (DBS SP) 1Q16: Non-Interest Income Exceeds Expectations
- 1Q16 results exceeded expectations.
- The bancassurance partnership with ManuLife boosted fees from wealth management while net trading income remained robust.
- There was no deterioration in asset quality from the O&G sector.
- DBS suffers from contraction in trade loans in 1H16 but corporate loans should pick up in 2H16.
CACHE LOGISTICS TRUST K2LU.SI CACHE LOGISTICS TRUST 3Q15 ~ Looking to cash in on Australia.
RESULTS
• Results in line with expectations.
- Cache Logistics Trust (Cache) reported a 3Q15 DPU of 2.14 S cents (0.0% yoy, 0.0% qoq). The results are in line with our expectations, with 9M15 DPU of 6.426 S cents representing 75.1% of our full-year 2015 forecast.
- Completion of the DHL BTS project saw portfolio occupancy decline 3.1ppt qoq, reaching 95.2% in the quarter. Gearing saw an uptick of 0.3 ppt qoq to hit 38.3% in the quarter, while 65% of borrowing has been hedged against interest rate risk. No refinancing is required till 2017 (17.7% of borrowings due).
Ezra Holdings - Not out of the woods yet; a sale-andleaseback of the Lewek Constellation could be on the cards.
FY15F PE (x): 18.4
FY16F PE (x): 20.3
- Ezra’s cash call has lifted its refinancing risks.
- However, its high gearing of 1.27x amidst the current industry downturn and a high cost structure make the situation challenging. A possible sale & leaseback of the Lewek Constellation would unlock US$200m in equity to bolster internal liquidity.
- On the flipside, the high vessel dayrate will add to cost burden.
- Subsea outlook has deteriorated. We cut FY15/FY16 earnings estimates by 35- 47%.
- Maintain HOLD with cum-rights target price of S$0.31.
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