Singapore stock investing: These stocks moved the Singapore market in November
Global stocks price levels continued their rise higher for the past 1 month since end October 2017. In the local Singapore market, some stocks have recorded higher than usual volume turnover. World economies are showing positive economic data coupled with stable inflation figures. STI index has recovered strongly since the start of the year 2017 and bullish momentum continues as the index charts new highs as a result of improving company earnings and fundamentals. We zoom into the top volume stocks for the past month to give investors a snapshot of some stocks with investment potential that warrants closer attention.
Rowsley has been a consistent feature as one of the top 20 stocks with the highest volume traded for SGX, and November month was no exception. Healthcare stocks has been in the limelight since July, following the dual listing of IHH healthcare and billionaire Peter Lim’s planned injection of hospital operators Thomson Medical and TMC Life Sciences into Rowsley in an all-share deal. This will make Rowsley a healthcare stock with hospital assets post acquisition. The stock volume surged in recent months due to the planned acquisition, which will breathe new life into the stock with a business model centred on medical and healthcare. Detailed financials for the target companies are still scant and pending further disclosure. IHH Healthcare and Raffles Medical, its closest peers post acquisition are trading at premium valuations with P/E multiples od between the 20s and 30s. On the back of the newsflow, Rowsley’s current financials were not in the best state as it swings to a Q3 2017 loss as a result of fair value losses. The stock remains actively traded and investors are awaiting fresh leads on the definitive agreements to acquire the healthcare assets.
Genting Singapore recorded strong trading volumes for the month of November as well and featured in the top 20 highest volume stock traded. Its recent Q3 2017 quarter earnings release saw net profit jumped 35% on the back of strong recovery in its VIP and premium gaming receipts. The holiday season will be a boon to Genting Singapore’s leisure business segment as well. A slew of business expansion programs are underway with the main project being the potential winning bid for Japan’s gaming license. Investors are closely following the progress of the expansion plan in the land of the rising sun.
Lippo Malls Indonesia Retail Trust
Lippo Malls Indonesia Retail Trust saw its shares heavily traded down, as investors reacted negatively to a rights issue announced on 24 October 2017 for acquisitions which could dilute returns. DPU for Q3 2017 was flat, which could also partially explain for the fall in share price. The REIT has gained almost 10% this year and investors may be locking in profits for the time being.
MindChamps Preschool, which had just debuted on the SGX Mainboard on 24 November 2017, saw its shares heavily traded up on the first trading day. The preschool operator saw its shares heavily oversubscribed, which is a signal of investor’s bullishness on the growth of the new IPO company. The shares continue to be traded heavily. The company is backed by Singapore Press Holdings, which owns a 20% stake in the company. P/E for the company is on the high side at 37 times adjusted EPS for fiscal year 2016. Newly listed stock counters usually experience high trading volumes as the value of the company is uncertain due to lack of historical market data. Investors can take advantage of over-optimism or over-pessimism of the market by trading in these shares.
Keppel-KBS US REIT
Keppel-KBS US REIT also saw heavy trading volume in November 2017 as it debuted on the SGX Mainboard on 9 November 2017. Its shares were also over-subscribed by 6.7 times, as investors are attracted by its forecast dividend yield of 6.8%, much higher than the average SGX listed office REITS annual yield on the market. The IPO was a success as well with its price closing 2% higher compared to its IPO price of US$0.88 per share. Investors can consider investing in this US based commercial REIT, by analyzing it alongside the incumbent Manulife US REIT and other commercial REITS on SGX.
Cosco Shipping International (Singapore) Co. Ltd saw its share trading volume spike in November 2017 right after the announcement of a takeover offer of another SGX listed entity, Cogent Holdings. Cosco plans to buy the company whole by offering S$1.02 per share as it is attracted by Cogent’s strong logistics presence in Singapore and Malaysia. Cosco Shipping’s financials were starting to see light as well as it returned to black with a net profit of S$24 million for Q3 2017 as compared to a S$102.3 million loss in Q3 2016. Investors are bidding up the shares as they see potential synergies and profit contribution from the newly acquired entity.
Jiutian Chemical Group
Jiutian Chemical Group Limited saw its shares heavily traded coupled with a sharp rise in stock prices. This could be explained by the sharp rise in Q3 2017 net profits as published on the SGX announcement portal. Revenue jumped a whopping 61% in Q3 2017 as compared to Q3 2016 while net profits surged 2,319% from RMB 0.5 million to RMB 12 million. Investors may take a closer look at the latest earnings announcement notes to understand better the huge earnings improvement in the China based chemicals product manufacturer.
Allied Technologies Limited saw strong surge in trading volumes beginning in the month of November 2017. Its share price also increased sharply in the same period. No significant market news of M&A activities could be found. Its latest Q3 earnings announcement on SGX portal was also lackluster, with no improvement in net profits which decreased by 32% in Q3 2017 as compared to Q3 2016. The only plus point was a 9% increase in revenue but improvement to its bottom line.