Alibaba (9988 HK)
Alibaba’s stock remains a strong buy with a target price of HK\$130.00. Despite trading at 10.6x FY25F PE, which is 1.2 standard deviations below its historical mean, Alibaba is expected to benefit from Taobao Tmall Group’s strategic implementations aimed at fostering monetization in the second half of 2024. The company’s competitive pricing strategy and increased subsidized products have resulted in a 140% year-on-year growth in new users for the fashion category.
Key financials for Alibaba include a market capitalization of HK\$2,006,261 million and a projected PE of 12.0x for 2024F. The company’s robust growth trajectory is expected to continue, driven by the increasing online retail penetration and supportive government policies in China.
JD.com (9618 HK)
JD.com is also recommended as a buy with a target price of HK\$190.00. The company’s focus on improving its 1P supply chain and enriching 3P merchants and white label products is expected to drive future growth. Despite a subdued outlook for the second half of 2024, JD.com is committed to enhancing its competitive edge through cost-effective procurement and expanded product offerings.
JD.com’s key financial metrics include a market capitalization of HK\$528,180 million and a projected PE of 11.3x for 2024F. The company’s strategic initiatives and commitment to operational excellence position it well for continued success in the highly competitive e-commerce sector.
Prudential (2378 HK)
Prudential has demonstrated solid growth with an 11% year-on-year increase in new business profit (NBP), driven by improved sales momentum across China, Hong Kong, and Indonesia. The company’s NBP margin also edged up by 1.8 percentage points year-on-year, thanks to a favorable product mix and channel mix shift.
Prudential’s strong performance is expected to continue, with management guiding for 9-13% NBP growth in 2024. The company’s well-diversified business model and strategic focus on high-growth markets underpin its robust growth outlook. Prudential remains a buy with a target price of HK\$126.00.
CIMB Group (CIMB MK)
CIMB Group’s positive growth trajectory is reflected in its strong performance, with management maintaining an optimistic outlook for meeting its 11.0-11.5% ROE target. The group’s stable net interest margin (NIM) and non-interest income growth are key drivers of its performance.
However, the stock is currently trading at +1SD above its 10-year historical mean PBV, suggesting that these positives may already be priced in. CIMB Group’s focus on improving asset quality and rationalizing deposit competition supports its growth prospects. The stock remains a hold with a target price of RM8.12.
Fraser & Neave Holdings (FNH MK)
Fraser & Neave Holdings continues to show resilience despite external delays to its dairy project. The company’s earnings are expected to remain largely neutral, with ongoing commitments to dairy-related mid-stream projects. These initiatives are on track for production, providing a meaningful cost advantage over competitors.
Fraser & Neave Holdings is a buy with a target price of RM36.30. The company trades at 20.3x FY25F PE, a deep bargain compared to its consumer staple peers. The delay in the dairy project is seen as a temporary speed bump, with long-term prospects remaining intact.
LINK REIT (823 HK)
LINK REIT reported a 3.7% year-on-year increase in its distribution per unit (DPU) for the first half of FY25, meeting expectations. The company’s Hong Kong malls saw a rental reversion of 0.7%, while its China portfolio experienced organic revenue growth. LINK REIT’s net gearing stands at 20.6%, with an average funding cost of 3.69%.
The company remains committed to its LINK 3.0 strategy, focusing on expanding into major APAC markets. Despite near-term challenges, LINK REIT’s long-term development prospects are supported by its strategic focus on solid deals and yield-accretive investments. The stock remains a buy with a target price of HK\$45.08.
SIA Engineering (SIE SP)
SIA Engineering’s first half of FY25 core net profit of S\$70.4 million was a slight miss, at 45% of the full-year forecast. The company’s operating profit was impacted by supply chain constraints and gestation costs related to new business expansion initiatives. However, SIA Engineering’s long-term growth prospects remain positive, driven by its strategic expansion projects.
The stock is a buy with a target price of S\$2.70. Investors are encouraged to stay invested as SIA Engineering builds a strong foundation for future growth through its strategic initiatives and investments in new business opportunities.
CapitaLand Investment (CLI SP)
CapitaLand Investment has been executing well operationally but remains cautious on its profitability outlook for 2025. The company has adjusted its target price to S\$3.85, reflecting the challenges ahead. Despite these challenges, CLI’s operational excellence and strategic focus on capital recycling and asset management support its long-term growth prospects.
The stock remains a buy with a target price of S\$3.85. Positive newsflow on asset recycling and concrete policy support from the Chinese government could provide further upside to the share price.
PTT Global Chemical (PTTGC TB)
PTT Global Chemical reported a net loss of Bt19.3 billion for 3Q24, primarily due to a significant impairment loss. The company’s upstream business benefitted from improved gross refining margins and a recovery in aromatics spreads. However, the olefins business posted flat adjusted EBITDA quarter-on-quarter.
PTTGC’s performance is expected to remain challenging in 4Q24, with continued pressure from shrinking petrochemical spreads and further impairment losses. The stock is currently trading at 0.42x BV for 2025, reflecting the negative outlook for the petrochemical sector. Investors are advised to switch to leading stocks within the oil & gas sector, such as Bangchak Corporation and Indorama Ventures.
CH Karnchang (CK TB)
CH Karnchang is expected to report strong yoy and qoq growth in 3Q24, driven by equity income from CK Power and reduced losses from Luang Prabang Power Company Limited. The company’s net profit is projected at Bt955 million for 3Q24, marking a significant increase compared to previous quarters.
CK’s earnings outlook remains positive, supported by its robust backlog. The stock is trading at an undemanding valuation of 1SD below its 10-year historical mean PE, making it an attractive investment. CK remains a buy with a target price of Bt26.50.
Minor International (MINT TB)
Minor International is expected to report a core profit of Bt2.5 billion for 3Q24, driven by strong hotel performance in Europe and Thailand. The company’s strategic focus on cost control and adapting to dynamic market conditions supports its growth outlook. MINT’s earnings performance is expected to remain robust, with significant contributions from its hotel and food businesses.
The stock remains a buy with a target price of Bt38.00. MINT’s adaptability in foreign markets and active cost-saving initiatives position it well for long-term growth.
United Tractors (UNTR IJ)
United Tractors’ performance in 3Q24 was driven by higher gold prices and strong sales of Komatsu equipment. The company’s net profit for 9M24 is ahead of expectations, supported by robust performance across its business segments. United Tractors remains a hold with a target price of Rp30,000, reflecting the positive outlook for its mining and construction machinery businesses.
The company’s strategic focus on operational excellence and cost management supports its long-term growth prospects. Investors are advised to maintain their positions, given the strong performance and positive outlook for United Tractors.
Singapore Post (SPOST SP)
Singapore Post reported strong 1HFY25 results, with overall revenue, operating profit, and core PATMI showing significant growth. The company’s Singapore business benefitted from a postal rate hike, while its Australian business posted robust growth due to the consolidation of Border Express. However, higher interest costs and softer-than-expected performances in certain segments dragged down overall performance.
SPOST declared a higher interim dividend, reflecting its strong financial performance. The stock remains a buy with a target price of S\$0.61, supported by the company’s strategic focus on growth and operational excellence.
Frasers Logistics & Commercial Trust (FLT SP)
Frasers Logistics & Commercial Trust reported strong growth in 2HFY24, driven by its logistics properties and positive rental reversion. The company’s strategic focus on expanding its logistics portfolio and improving operational efficiency supports its long-term growth prospects. FLT remains a buy with a target price of S\$1.44, reflecting the positive outlook for its business.
The stock is well-positioned to benefit from the growing demand for logistics properties, supported by its strategic initiatives and strong market position.
Virtual Meeting Events
The report also highlights several upcoming virtual meetings and corporate roadshows. These events provide valuable opportunities for investors to engage with company management and gain insights into their strategic initiatives and future prospects.
- Virtual Meeting with Singapore – 13 Nov 2024
- Valuetronics Holdings Ltd (VALUE SP) Hybrid Corporate Roadshow for Singapore – 15 Nov 2024
- Prima Marine Public Company Limited (PRM TB) Post 3Q2024 Results Investors Virtual Meeting with Prime US REIT (PRIME SP) – 21 Nov 2024
- ComfortDelGro Corporation Limited (CD SP) – 21 Nov 2024
Conclusion
This comprehensive analysis provides valuable insights into the performance and future prospects of several key companies. Investors are encouraged to consider these insights when making investment decisions, as they provide a deeper understanding of the strategic initiatives and growth trajectories of these companies.
