Chart Updates

 

source: cnn

Chart 1: Fear and Greed Index

sign of U-turning if below level 60

May 2023 Market Holidays

 May 2023 Market Holidays

Singapore Market Holidays 2023

 Singapore Market Holidays 2023

source: calendarlabs .com / SGX

KIT Plans to Raise $240 Million Through Equity Fundraising: An Overview

source: SGX announcement

For existing shareholders, 5 for 100 held

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Indicative Time Table

souce: SGX announcement

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KIT announced equity fund raising morning. Details are as follows:

Total: S$125mln (private placement) + $115mln (non-renounceable preferential offering) = S$240mln

Placement offering size: S$125.0m
Offer price range: S$0.464 - S$0.477 representing:
•7.4% - 9.9% discount to last close
•7.4% - 9.9% discount to VWAP
•5.1% - 7.7% discount to adjusted VWAP

Preferential Offering size: S$115.0mln
Offer price range: S$0.464 – S$0.467 representing:
•9.3% and 9.9% discount to VWAP
•7.1% and 7.7% to Adjusted VWAP

Forecast FY23 yield: ~8.4% - 8.6%
Use of Proceeds: Partial repayment of the bridge facilities which were used to initially fund the acquisition of 3 assets in 2H2022
Sponsor: Sponsor undertakes to subscribe for its 18.21% prorata share of the placement

Important Dates:
Launch of Placement: 18th April 23
First date of ex-trading of Placement Units: 25th April 23
Expected date of issue of Placement Units: 27th April 23
Expected date of issue of Preferential Units: 18th May 23

~ source: Lim and Tan Telegram

DBS Historical P/B (and its relation to Fed Funds Rate)

 

source: Lim and Tan

Chart 1 - DBS historical P/B 

* Accordingly, every 100 basis point hike expected to add S$1 billion to S$2 billion to banking sector profits

Singtel's Strategic Expansion into Indonesia and Thailand's Data Centre Markets

 

chart created using trading view

Chart 1 : Singtel monthly chart

RHB Bank analysts have suggested that Singapore Telecommunications (Singtel) should be bought by investors because the Asean data centre market is about to experience “hyper-growth”. The analysts added that the positive outlook resonates well with their preference for fixed-line plays, as Singapore’s calibrated data centre growth is squeezing inventory, resulting in overflow to neighbouring hubs. Singtel is expected to be a leader in data centre services regionally with the best interconnectivity in Southeast Asia by 2026. The group already owns and operates seven data centres in Singapore with a rated capacity of over 70 MW, but it plans to expand to over 170 MW regionally within three to five years through joint ventures with Indonesia and Thailand. ~ source: thedge

S-REITs

Chart 1 : FTSE REITs Index (chart created using C2 - Shareinvestor)

JP Morgan analysts are concerned about the rental portion of some S-REITs, citing vacancy risks as a key focus for 1Q2023. They point out specific concerns regarding non-renewals or partial renewals from tenants such as AT&T, Atos, Seiko, and NTT, as well as litigation with DXC. However, S-REITs with office and hospitality assets are expected to report improved rental reversions. JP Morgan prefers to err on the side of caution and sees downside to street DPUs post-results, with its top picks being laggards such as CDL Hospitality Trusts, CICT, CapitaLand Ascendas REIT, KDC REIT, and Mapletree Logistics Trust. ~ theedge

Unlocking Value: The Role of Company Share Buybacks

Understanding Company Share Buybacks: A Powerful Tool for Investors

Company share buybacks, also known as stock repurchases, have become increasingly popular as a financial strategy employed by companies to repurchase their own outstanding shares from the market. This article aims to shed light on the concept of share buybacks and their significance in the realm of investment.

Motivation: Unveiling the Reasons behind Share Buybacks

Companies embark on share buybacks for various reasons. One common motivation is to convey the belief that their stock is undervalued. By reducing the number of shares in circulation, the company strives to enhance the value of the remaining shares.

Capital Allocation: Maximizing Value through Share Repurchases

When companies find themselves with excess cash or lacking attractive investment opportunities, they may opt for share buybacks instead of dividends or acquisitions. This enables them to allocate their capital in a manner that creates value for shareholders.

Earnings per Share (EPS) Impact: Amplifying Profitability

Share buybacks can have a positive impact on a company's earnings per share. As the number of outstanding shares diminishes, the same earnings are distributed among fewer shares, leading to an increase in the EPS. Consequently, the company's stock may become more appealing to investors, potentially driving its price upwards.

Tax Efficiency: A Favorable Approach for Shareholders

In some countries - share buybacks offer greater tax efficiency for shareholders compared to dividends. While dividends are typically subject to immediate dividend taxes, shareholders who sell their repurchased shares at a later date may incur capital gains taxes instead.

Investor Implications: Interpreting the Message

Share buybacks can have varying effects on individual investors, contingent upon the context. If a buyback signifies the company's confidence in its future prospects, it can bolster investor confidence and potentially elevate stock prices. Conversely, if buybacks are used excessively to artificially inflate stock prices without improving underlying fundamentals, it may raise concerns among investors.

Conclusion:

While share buybacks can generate value for shareholders, they should be approached with caution. Excessive debt or inflated prices can undermine a company's financial health in the long run. Therefore, investors must thoroughly evaluate a company's financial position, strategy, and motivations behind share buybacks before making informed investment decisions.

By comprehending the intricacies of company share buybacks, investors can harness this powerful tool to analyze investment opportunities and navigate the dynamic world of finance.

HK Market Matching Procedures

Applicable CAS Securities 

Closing Auction Session (CAS) is applicable to all equities (including depositary receipts, investment companies, preference shares and stapled securities), as well as funds (including exchange traded funds (ETFs) and real estate investment trusts)

The first period

(Reference Price Fixing Period, 4:00-4:01pm)

- A reference price, which sets the allowable price limit of the CAS, is calculated for each CAS security.

The second period

(Order Input Period, 4:01-4:06pm)

- At-auction orders and at-auction limit orders within ± 5% percent price limit can be entered, amended or cancelled.

The third period

(No-Cancellation Period: 4:06-4:08pm)

- At-auction orders and at-auction limit orders can be entered. However, the prices of new at-auction limit orders must be between the lowest ask and highest bid of the order book, and no orders can be amended or cancelled.

The fourth period

(Random Closing Period: 4:08-4:10 pm)

- The market closes randomly within two minutes.

~ source: aastocks website