Singapore Market Focus - DBS Research 2020-08-06: Despair Not

Singapore Market Focus - DBS Research | SGinvestors.io CAPITALAND LIMITED (SGX:C31) CITY DEVELOPMENTS LIMITED (SGX:C09) COMFORTDELGRO CORPORATION LTD (SGX:C52) THAI BEVERAGE PUBLIC CO LTD (SGX:Y92) OVERSEA-CHINESE BANKING CORP (SGX:O39)

Singapore Market Focus - Despair Not




COVID-19 ups and downs.

  • The viral resurgence in the US and the rise in cases in countries such as HK, Japan, Spain and the Philippines are a stark reminder that until a vaccine is found, the road to recovery is likely long drawn. The resurgence is flattening out in the US and there is cautious optimism that the outbreaks in other countries can be brought under control.
  • On a positive note, there are more than 165 vaccine candidates and several are under phase 3 trials, the last phase before regulatory approval if the outcome is positive. Watch this space over the next 2-3 months.


Despair phase.



Hunt for yield continues.



Five undervalued cyclicals and blue chips to bargain hunt

  • While REIT, technology and medical equipment stocks are hotly pursued by investors in the current environment, we believe investors should also keep an eye for opportunities in the undervalued cyclical sectors (Property and banks) and consumer related blue chips as several are trading at historic valuation extremes that should provide support.
  • While there is a lack of strong upside catalyst currently, any positive news or development such as additional fiscal support, gradual recovery in global trade or progress in vaccine development should bode well for them. We believe the current lull period for these stocks is an opportunity to accumulate.
  • Property developers offer deep value, trading at GFC trough valuations – P/B of 0.6x. Current valuations have priced in a 10-15% portfolio deterioration in asset prices, a scenario which is unlikely given low interest rates and the low yield environment.
  • Our picks are CapitaLand (SGX:C31), City Developments (SGX:C09), ComfortDelGro (SGX:C52), Thai Beverage (SGX:Y92) and OCBC (SGX:O39).

See PDF report attached below for complete analysis.






Kee Yan YEO CMT DBS Group Research | Janice CHUA DBS Research | https://www.dbsvickers.com/ 2020-08-06
SGX Stock Analyst Report BUY MAINTAIN BUY 3.70 SAME 3.70
BUY MAINTAIN BUY 10.50 SAME 10.50
BUY MAINTAIN BUY 1.680 SAME 1.680
BUY MAINTAIN BUY 0.900 SAME 0.900
HOLD MAINTAIN HOLD 9.300 SAME 9.300



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