04/01/2016 Wired Weekly - DBS Bank 04/01/2016 4 January 2016 Singapore Traders Spectrum Wired Weekly...

04/01/2016

4 January 2016

Singapore Traders Spectrum

Wired Weekly Refer to important disclosures at the end of this report

Straits Times Index FTSE Small Cap Index

STI and 12-mth forward PE Brent Crude Oil

Source: Datastream, DBS Bank FTSE Indices 5-Day Performance

Source: Bloomberg Finance L.P.

360

380

400

420

440

460

480

500

520

Jan-15 Apr-15 Jul-15 Oct-15 Jan-16

FTSE Small Cap Index

2,600

2,700

2,800

2,900

3,000

3,100

3,200

3,300

3,400

3,500

3,600


ST Index

2600

2800

3000

3200

3400

3600

3800

4000

Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16

Average @ 13.8x

+0.5SD @ 14.5x

-0.5SD @ 13.0x

-1SD @ 12.2x

30

3540

4550

55

6065

7075


Brent Crude OilUS$/barrel

Index @ 1 Wk % YT D %

F TSE Sectoral Indices 31-Dec-15 Chg Chg

STI 2882.73 0.2 -14.3

Mid Cap 667.53 -0.6 -10.8

Small Cap 403.51 -0.1 -18.0

All Share 694.98 0.3 -13.7

China 208.96 0.6 -5.8

Real Estate 701.61 0.4 -7.2

Real Estate & Dev 720.96 0.7 -3.4

Real Estate Inv Trust 695.93 0.1 -10.7

Oil & Gas 381.6 -1.6 -33.9

Basic Materials 107.8 -2.1 -14.1

Industrials 666.32 0.6 -17.5

Consumer Goods 429.93 0.2 -12.3

Health Care 1471.12 1.2 27.2

Consumer Serv ice 773.01 0.6 -7.8

Telecommunication 954.39 0.5 -6.9

Utilities 417.87 0.5 -11.8

Financials 771.65 0.3 -12.8

Technology 316.72 0.4 -23.0

Yeo Kee Yan (65) 6682 3706 [email protected] www.dbsvickers.com

sa: YM

KEY POINTS

Capricorn rally likely short-lived – STI near-term

bounce capped at 2950, weakness towards 2650-2700 over next 1-2 mths presents a good opportunity to accumulate

10 stock picks - Capitaland, City Developments, Ezion, Japfa, MAGIC, Sheng Siong, ST Engineering, Thai Beverage and Venture Corp

Wired Weekly

A return to normal trading activity should lift stock prices higher as the New Year begins. However, we maintain our view that any attempt at a ‘Capricorn Rally’ will be short-lived or unsuccessful. The shadow of higher interest rates, risk of more earnings disappointments during the 4QFY15 results season and the uncertain 2016 growth outlook continue to be a near term drag for equities. Furthermore, history has shown that the initial 1-3 months would be negative for equities once the Fed starts its rate hike cycle. We see technical resistances at 2905 and 2950 capping near-term upside.

But a decline closer to 2650-2700 during the initial 1-2 months of the year is a good opportunity to accumulate. This is because 1) Singapore market valuation is inexpensive, 2) history shows the inflexion point for the negative stock market reaction off the initial US rate hike is within a 3-mth period, and 3) period from mid-March till end-April is traditionally positive for equities as investors position ahead of stocks going ex-dividend.

Our 10 stock picks are Capitaland, City Developments, Ezion, Japfa, MAGIC, Sheng Siong, ST Engineering, Thai Beverage and Venture Corp.

On the data front, Singapore’s 4Q15 GDP advanced estimates rose a better-than-expected 5.7% q-o-q saar. Our Singapore economist commented that despite this, overall GDP growth is still the slowest in 6 years. Risks remain of potential capital flight that could result from further US rate hikes and/or fears of further deceleration in China. He maintains GDP growth of 2.1% for 2016.


Wired Weekly

Singapore Market Summary

The benchmark STI rose 30pts in the final 2 weeks of December to finish the year at 2882 (-14% y-o-y). Bargain hunting in anticipation of a Capricorn rally likely drove the bounce. Activity was light during the traditional year-end period with the value of shares traded on the Singapore Exchange averaging a mere S$520mil/day over the last 2 weeks.

Uncertainties despite better-than-expected advance 4Q GDP

Advanced estimates for Singapore’s 4Q15 GDP grew a stronger-than-expected 5.7% q-o-q saar. The services sector is expected to grow 6.5% q-o-q saar, which offsets a 3.1% q-o-q saar contraction in the manufacturing sector. Our Singapore economist commented that despite the stronger-than-expected figure, overall GDP growth is still the slowest in six years. Risks remain in the horizon with potential capital flight that could result from further US rate hikes and/or fears of further deceleration in China.

Going forward, growth outlook in the next 6-9 months will remain tepid before an improvement in the later part of 2016 can be expected. This should bring overall GDP growth for 2016 to 2.1%.

No cheer from November’s industrial production

Singapore’s November industrial production fell 5.5% y-o-y, worse off than the 3.3% decline expected. The figure marks the 10th consecutive month of decline. The weak performance was due to the 11.2% y-o-y contraction in the transport engineering cluster and an 11.1% y-o-y fall in electronics output.

Our Singapore economist commented earlier that the near-term outlook for the manufacturing isn’t improving given weak external demand. The manufacturing sector is in a structural decline. External competition, continued increases in business costs and manpower shortages are eroding the long-term prospects for the sector.

Singapore industrial production (% y-o-y)

Source: DBS Bank

Meanwhile, China’s December manufacturing PMI remained in contraction at 49.7, in line with consensus expectations. Total new orders, which are a proxy for both domestic and foreign demand, rose to 50.2 in December from November's 49.8. Export orders shrank at a less severe pace to 47.5 from November's 46.4.

Capricorn rally likely short-lived, STI’s near-term bounce capped at/below 2950

A return to normal trading activity should lift stock prices higher as the New Year begins. However, we maintain our view that any attempt at a ‘Capricorn Rally’ will be short-lived or unsuccessful. The shadow of higher interest rates, risk of more earnings disappointments during the 4QFY15 results season and the uncertain 2016 growth outlook continue to be a near term drag for equities. Furthermore, history has shown that the initial 1-3 months would be negative for equities once the Fed starts its rate hike cycle.

Stocks could start the New Year with a ‘thud’ rather than a ‘BOOM’. We see technical resistances at 2905 and 2950 capping near-term upside.

Straits Times Index (Daily)

Source: DBS Bank

‐10

‐5

0

5

10

15

Negative for 10 consecutive months


Wired Weekly

The consolation is that after the dismal YTD decline of c.15%, STI’s valuation is inexpensive. At 2882, STI trades below 12.22x (-1SD) FY16F PE. EPS growth is at a comfortable 6.1% although the figure is at risk of getting tweaked lower. Still, this provides some cushion to downward pressure.

Accumulate weakness around STI 2650-2700

A decline closer to 2650-2700 during the initial 1-2 months of the year is an opportunity to accumulate.

We see weakness in 1QCY16 on interest rates and earnings uncertainties. We look to accumulate stocks upon this weakness for a tradable rally because: 1) market valuation is inexpensive, 2) history shows the inflexion point for the negative stock market reaction off the initial US rate hike is within a 3-mth period, and 3) period from mid-March till end-April is traditionally positive for equities as investors position ahead of stocks going ex-dividend.

Our stock picks are shown in the table below.

Stock picks

Source: DBS Bank

CompanyPrice 15

Dec 2015Target Price

T arget Return

PER 15 (x)

PER 16 (x)

PER 17 (x )

EPS Growth 16 (%)

EPS Growth 17 (%)

Div Y ield

16 (%)

Net Debt / Equit y 16 (%)

P/BV 15 (x )

Comments

CapitaLand 3.260 3.73 14% 19.4 18.2 15.1 6.6 21.0 2.5 0.6 0.8Focus on growing commercial portfolio & coupled with opportunistic asset recycling of mature assets into its listed REITs/funds present earnings upside

City Dev elopment 7.540 10.26 36% 11.8 11.1 10.7 6.0 4.2 1.7 0.3 0.8Attractive valuations with stock trading below GFC low. South Beach development a top-line driver.

Ez ion Holdings 0.595 1.00 69% 5.5 3.2 2.8 74.1 13.6 0.2 0.8 0.5

Top O&G pick. Re-rating catalysts from earnings recovery with the resumption of serv ice rigs in 1H16, delivery of newbuild liftboats, customer base d f

J apfa Ltd 0.485 0.90 86% 13.6 7.7 4.9 76.4 57.7 - 0.6 0.8

Better 3Q15 EBITDA expected. Japfa’s 3Q15 earnings should show a sequential improvement, given higher feed prices and relatively resilient broiler and DOC prices

MGCCT 0.915 1.11 22% 17.2 15.2 14.9 13.0 1.8 8.5 0.4 0.8Concerns over the slowdown in the HK retail market are overplayed near term given the delivery of a 12.6% y-o-y increase in 2Q16 DPU to 1.808Scts

Sheng Siong Group 0.835 1.01 21% 22.4 20.6 20.5 8.6 0.5 4.4 cash 5.2

On track towards its 50-store target. Margin expansion trend. One of the most well-run grocery retailers in ASEAN, leading regional peers in profitability , cashflow generation and working capital management. Div idend attractive at 4.3%.

ST Engineering 2.960 3.60 22% 17.4 17.2 16.9 0.9 1.6 5.1 cash 4.2

Electronics div ision to capitalise on the SG Smart Nation with projects worth more than S$1bn in the near future. Recent focus on space-related technology and robotics hold promise as longer-term growth drivers.

T hai Bev erage Public 0.685 0.82 20% 16.5 17.3 16.1 -4.9 7.5 3.8 0.3 3.9

Advantage over its peers given its dominant position as the leading spirits player in Thailand, prov iding it with ample firepower and serve as a bastion for the company while it invests in new avenues of growth.

V enture Corporat ion 8.330 9.00 8% 14.8 13.2 12.3 11.8 6.9 6.0 cash 1.2

Consensus FY16F earnings have room to rise further. Street forecasts not fully factored in impact of 15% decline in SGD/MYR over the last year. Every 2% decline in MYR would have a 1.5% positive impact on Venture’s profits.


Wired Weekly

Top large and small / mid cap picks

Source: DBS Bank

TOP LARGE CAP PICKSCompany Recom Pric e

Ta rge t Pric e

Ups ide Cata lys t

Capitaland BUY 3.350 3.73 11% 1) Main business units delivering steady increases in performance2) Asset recycling of mature assets into REITs/Funds3) Growing recurring income base as retail malls in China stabilise

ST Engineering BUY 3.010 3.60 20% 1) Outlook remains healthy.2)Targeted investments provide potential upside in medium term.3) M&A potential remains untapped.

TOP SMALL / MID CAP PICKSCompany Recom Pric e

Ta rge t Pric e

Ups ide Cata lys t

Mapletree Greater China Commercial Trust

BUY 0.915 1.11 22% 1) V isible organic growth2) Portfolio of quality assets

Venture Corporation BUY 8.200 9.00 10% 1) Beneficiary of the strong US dollar and weak ringgit.2) Strong balance sheet and net cash position to support div idend payout of 50Scts, with a y ield of c.6%.


Wired Weekly

Shanghai Composite Index Hang Seng Index Taiwan Index

Nikkei Index Dow Jones Industrials NASDAQ Index

USD/SGD USD/JPY Euro/USD

USD/RMB SGD/RMB AUD/SGD

Source: Datastream, DBS Bank

12 mth: 9.4% YTD: 0.0% 12 mth: -7.2% YTD: 0.0% 12 mth: -10.4% YTD: 0.0%

1 mth: 0.1% 1 Wk: -2.4% 1 mth: -2.5% 1 Wk: -1.0% 1 mth: -1.4% 1 Wk: -0.3%

1,900

2,500

3,100

3,700

4,300

4,900

5,500


Shanghai Comp Index

19,000

21,000

23,000

25,000

27,000

29,000


Hang Seng Index

7,200

7,600

8,000

8,400

8,800

9,200

9,600

10,000

10,400


Taiwan Index

12 mth: 9.1% YTD: 0.0% 12 mth: -2.2% YTD: 0.0% 12 mth: 5.7% YTD: 0.0%

1 mth: -4.5% 1 Wk: 1.4% 1 mth: -1.7% 1 Wk: -0.7% 1 mth: -2.3% 1 Wk: -0.8%

15,000

16,000

17,000

18,000

19,000

20,000

21,000

22,000


Nikkei 225 Index

15,000

15,500

16,000

16,500

17,000

17,500

18,000

18,500

19,000


Dow Jones

4,200

4,400

4,600

4,800

5,000

5,200

5,400


Nasdaq

12 mth: 7.1% YTD: 0.0% 12 mth: 0.4% YTD: 0.0% 12 mth: -10.2% YTD: 0.0%

1 mth: 0.4% 1 Wk: 0.9% 1 mth: -2.4% 1 Wk: -0.1% 1 mth: 2.7% 1 Wk: -0.9%

1.25

1.30

1.35

1.40

1.45


usd/SGD

114

116

118

120

122

124

126

128


usd/JPY

1.00

1.05

1.10

1.15

1.20

1.25


Euro/USD

12 mth: 4.6% YTD: 0.0% 12 mth: -2.1% YTD: 0.0% 12 mth: -4.7% YTD: 0.0%

1 mth: 1.5% 1 Wk: 0.3% 1 mth: 1.5% 1 Wk: -0.5% 1 mth: 0.4% 1 Wk: 1.3%

6.10

6.20

6.30

6.40

6.50

6.60


usd/RMB

4.40

4.45

4.50

4.55

4.60

4.65

4.70

4.75


sgd/RMB

0.95

0.97

0.99

1.01

1.03

1.05

1.07

1.09

1.11

1.13


A$/SGD


Wired Weekly

Baltic Dry Index Volatility Index Fed Funds Rate

Brent Crude Oil Palm Oil Soya Oil

Aluminium Tin Steel

Copper Nickel Gold

Source: Datastream, DBS Bank

12 mth: -38.9% YTD: 0.0%

1 mth: -19.0% 1 Wk: 0.0%

400

600

800

1,000

1,200

1,400


Baltic Dry Index

8

12

16

20

24

28

32

36

40

44


Volatility Index

0.00

0.10

0.20

0.30

0.40

0.50

0.60


Fed Funds Rate

12 mth: -36.1% YTD: 0.0% 12 mth: -20.6% YTD: 0.0% 12 mth: -7.8% YTD: 0.0%

1 mth: -16.8% 1 Wk: -3.9% 1 mth: 5.6% 1 Wk: 0.8% 1 mth: 1.7% 1 Wk: -1.0%

30

3540

45

50

5560

65

7075


Brent Crude OilUS$/barrel

400

450

500

550

600

650

700


Palm OilUS$/ton

24

26

28

30

32

34

36


Soya OilUS$/Ib


1 mth: -0.2% 1 Wk: -0.3% 1 mth: -3.3% 1 Wk: 0.1% 1 mth: -3.9% 1 Wk: 2.4%

1,500

1,600

1,700

1,800

1,900


AluminiumUS$/MT

13,000

15,000

17,000

19,000

21,000


TinUS$/MT

1,400

1,600

1,800

2,000

2,200

2,400

2,600


Steel (rebar)RMB/MT


1 mth: 3.0% 1 Wk: 0.3% 1 mth: -1.8% 1 Wk: 2.1% 1 mth: 0.6% 1 Wk: -1.2%

4,000

4,500

5,000

5,500

6,000

6,500

7,000


CopperUS$/MT

6,000

8,000

10,000

12,000

14,000

16,000


NickelUS$/MT

1,000

1,050

1,100

1,150

1,200

1,250

1,300

1,350


GoldUS$/Ounce


Wired Weekly

Straits Times Index


Last PriceLast Day

V olA v g V ol for

the WeekRel ST I MT D

Rel ST I QTD

Rel ST I YT D Weight

A ctual Mk t Cap

S/No. B'berg Code Stock Name Crncy 31-Dec-15 (000 Shrs) (000 Shrs) (%) (%) (%) (%) (S$m)1 DBS SP DBS SGD 16.30 2,271 1,751 (1) (1) (1) 12.7 40,7792 OCBC SP OCBC Bk SGD 8.67 1,676 2,447 (1) (1) (1) 12.3 35,6813 ST SP SingTel SGD 3.62 10,002 11,098 1 1 1 11.6 57,7164 UOB SP UOB SGD 19.17 1,211 1,001 (2) (2) (2) 10.1 30,7155 HKL SP HKLand US$ USD 6.98 974 1,199 (0) (0) (0) 5.1 23,2866 KEP SP Keppel Corp SGD 6.54 1,459 2,557 0 0 0 4.1 11,8457 CAPL SP Capitaland SGD 3.28 4,788 5,592 (1) (1) (1) 3.6 13,9338 THBEV SP Thai Beverage PCL SGD 0.69 581 2,846 1 1 1 2.9 17,2009 SPH SP SPH SGD 3.92 1,088 1,020 2 2 2 2.7 6,26210 GLP SP Global Logistics Properties SGD 2.08 4,527 6,328 (3) (3) (3) 2.7 9,86711 SGX SP SGX SGD 7.53 804 907 (1) (1) (1) 2.7 8,06912 CD SP ComfortDelGro SGD 3.02 2,635 3,228 1 1 1 2.7 6,49413 WIL SP Wilmar SGD 2.92 2,773 2,935 2 2 2 2.7 18,45414 SIA SP SIA SGD 11.08 468 526 (1) (1) (1) 2.4 12,89115 CT SP CapitaMall SGD 1.92 1,836 2,589 2 2 2 2.2 6,79916 AREIT SP A-REIT SGD 2.25 3,258 3,266 0 0 0 2.0 5,84517 GENS SP Genting SP SGD 0.77 7,060 8,790 2 2 2 2.0 9,18218 STE SP ST Engg SGD 2.95 886 935 (1) (1) (1) 2.0 9,15019 CIT SP City Developments SGD 7.52 564 912 (1) (1) (1) 1.9 6,83820 JCNC SP Jardine C&C SGD 34.86 86 124 0 0 0 1.7 13,77821 HPHT SP HPHT (US$) USD 0.53 1,165 5,275 3 3 3 1.7 6,54622 UOL SP UOL Group SGD 6.11 461 597 (1) (1) (1) 1.3 4,86523 SCI SP Semb Corp SGD 3.01 1,294 1,256 0 0 0 1.2 5,37324 SATS SP SATS SGD 3.92 873 547 4 4 4 1.1 4,35625 YZJSGD SP Yangzijiang SGD 1.08 3,700 3,156 (0) (0) (0) 1.0 4,11926 STH SP StarHub SGD 3.63 504 609 (1) (1) (1) 0.9 6,27227 GGR SP GoldenAgr SGD 0.33 2,438 8,549 0 0 0 0.9 4,20228 NOBL SP Noble Grp SGD 0.40 16,337 28,302 (0) (0) (0) 0.8 2,61429 SMM SP SembMar SGD 1.73 1,145 1,134 (0) (0) (0) 0.6 3,60330 SIE SP SIA Engg SGD 3.69 67 115 1 1 1 0.4 4,141


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Surce: Bloomberg Finance L.P.

At A Glance Currencies

Other Important Indicators

Important Dates (Singapore)

Announced Dividends and Capital Issues

Upcoming IPOs

None

Recent IPO Trading

Last Close

Pts chg

% Chg 1 wk

SG$/US$ 1.42 0.0 0.2

Yen/US$ 120.25 0.6 0.5

US$/Euro 0.92 0.0 0.3

AUS$/US$ 1.37 0.0 0.6

Pound/US$ 1.47 (0.0) (1.0)

Last Close

Pts chg 1wk

% Chg 1 wk

Gold 1062.55 (13.6) (1.3)

Crude Oil 37.04 (0.5) (1.2)

US$ Yield10-year 2.27 0.0 1.3

Event Period DateAutomobile COE Open Bid Cat A Jan 6-Jan-16Automobile COE Open Bid Cat B Jan 6-Jan-16Automobile COE Open Bid Cat E Jan 6-Jan-16Foreign Reserves Dec 7-Jan-16GDP SAAR QoQ 4Q A 7-Jan-16GDP YoY 4Q A 7-Jan-16Retail Sales SA MoM Nov 15-Jan-16Retail Sales YoY Nov 15-Jan-16Retail Sales Ex Auto YoY Nov 15-Jan-16Non-oil Domestic Exports YoY Dec 18-Jan-16Electronic Exports YoY Dec 18-Jan-16Non-oil Domestic Exports SA MoM Dec 18-Jan-16Automobile COE Open Bid Cat A Jan 20-Jan-16Automobile COE Open Bid Cat B Jan 20-Jan-16Automobile COE Open Bid Cat E Jan 20-Jan-16CPI NSA MoM Dec 25-Jan-16CPI YoY Dec 25-Jan-16CPI Core YoY Dec 25-Jan-16Industrial Production SA MoM Dec 26-Jan-16Industrial Production YoY Dec 26-Jan-16Unemployment rate SA 4Q 28-Jan-16Money Supply M1 YoY Dec 29-Jan-16Money Supply M2 YoY Dec 29-Jan-16Credit Card Billings Dec 29-Jan-16Bank Loans and Advances YoY Dec 29-Jan-16Credit Card Bad Debts Dec 29-Jan-16

Company Ty pe Part iculars Ex Date Paid/ Pay able

ABF SPORE BOND INDEX FUND ETF DIV IDEND SGD 0.0265 04-Jan-16 15-Jan-16

MEMTECH INTERNATIONAL LTD ENTITL. SHARE CONSO OFFER OF 1 FOR 5 04-Jan-16

NIKKO AM SINGAPORE STI ETF DIV IDEND SGD 0.0452 04-Jan-16 15-Jan-16

HUPSTEEL LTD ENTITL. SHARE CONSOL OFFER OF 1 FOR 5 05-Jan-16

SECOND CHANCE PROPERTIES LTD DIVIDEND SCRIP DVD SCH SGD 0.0355 ONE-TIER TAX 06-Jan-16 24-Feb-16

FRASER AND NEAVE, LIMITED DIVIDEND SGD 0.03 ONE-TIER TAX 03-Feb-16 19-Feb-16

FRASERS CENTREPOINT LIMITED DIVIDEND SGD 0.062 ONE-TIER TAX 03-Feb-16 19-Feb-16

AVI-TECH ELECTRONICS LIMITED DIVIDEND SGD 0.007 ONE-TIER TAX 15-Feb-16 29-Feb-16

N511100W 160401 ENTITL. REDEMPTION 100% 23-Mar-16 01-Apr-16

NY01100F 160901 ENTITL. REDEMPTION 100% 24-Aug-16 01-Sep-16

Company NameIPO Share

Price Last Close ICB Sector Name IPO DateSingapore O&G Ltd 0.750 0.75 Health Care Equipment & Serv ices 04/06/2015iX Biopharma Ltd 0.440 0.44 Pharmaceuticals & Biotechnology 22/07/2015NauticAWT Ltd 0.225 0.23 Oil Equipment, Serv ices & Distribution 23/07/2015Choo Chiang Holdings Ltd 0.360 0.36 Household Goods & Home Construction 29/07/2015CMC Infocomm Limited 0.100 0.10 Technology Hardware & Equipment 13/08/2015Soo Kee Group Limited 0.178 0.18 General Retailers 20/08/2015TLV Holdings Ltd 0.130 0.13 General Retailers 17/09/2015Jumbo Group Ltd 0.455 0.46 General Retailers 09/11/2015Trendlines Group Ltd/The 0.315 0.32 Health Care Equipment & Serv ices 26/11/2015Axcelasia Inc 0.199 0.20 Financial Serv ices 27/11/2015


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January 2016


Tues Wed Thu Fri1

4 5 6 7 8

Automobile COE Open Bid Cat AGDP SAAR QoQ Automobile COE Open Bid Cat BGDP YoY Automobile COE Open Bid Cat E Foreign Reserves

11 12 13 14 15

Retail Sales SA MoMRetail Sales YoYRetail Sales Ex Auto YoY

18 19 20 21 22

Non-oil Domestic Exports YoY Automobile COE Open Bid Cat AElectronic Exports YoY Automobile COE Open Bid Cat BNon-oil Domestic Exports SA MoM Automobile COE Open Bid Cat E

25 26 27 28 29

Money Supply M1 YoYMoney Supply M2 YoY

CPI NSA MoM Credit Card BillingsCPI YoY Industrial Production SA MoM Bank Loans and Advances YoYCPI Core YoY Industrial Production YoY Credit Card Bad Debts

31


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DBS Bank Ltd recommendations are based an Absolute Total Return* Rating system, defined as follows:

STRONG BUY (>20% total return over the next 3 months, with identifiable share price catalysts within this time frame)

BUY (>15% total return over the next 12 months for small caps, >10% for large caps)

HOLD (-10% to +15% total return over the next 12 months for small caps, -10% to +10% for large caps)

FULLY VALUED (negative total return i.e. > -10% over the next 12 months)

SELL (negative total return of > -20% over the next 3 months, with identifiable catalysts within this time frame)

Share price appreciation + dividends Traders Spectrum’s product is oriented towards readers with either a short-term trading horizon. It aims to highlight topical themes, which may move stock prices on a daily basis. Readers should be aware that “TS Take” relies more on assessments of technical factors, likely sentiment responses and short term money flows, rather than on fundamental analysis. As such the “TS Take” may from time to time conflict with fundamental ratings (where stocks are ranked to Strong Buy, Buy, Hold, Fully Valued and Sell on a 12 month basis), which are maintained by DBS Bank Ltd analysts. In keeping with the short-term orientation of the product, a stock highlighted may or may not be covered or commented on on an ongoing basis. GENERAL DISCLOSURE/DISCLAIMER This report is prepared by DBS Bank Ltd. This report is solely intended for the clients of DBS Bank Ltd and DBS Vickers Securities (Singapore) Pte Ltd, its respective connected and associated corporations and affiliates (collectively, the “DBS Vickers Group”) only and no part of this document may be (i) copied, photocopied or duplicated in any form or by any means or (ii) redistributed without the prior written consent of DBS Bank Ltd. The research set out in this report is based on information obtained from sources believed to be reliable, but we (which collectively refers to DBS Bank Ltd., its respective connected and associated corporations, affiliates and their respective directors, officers, employees and agents (collectively, the “DBS Group”)) do not make any representation or warranty as to its accuracy, completeness or correctness. Opinions expressed are subject to change without notice. This document is prepared for general circulation. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific addressee. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgment by addressees, who should obtain separate independent legal or financial advice. The DBS Group accepts no liability whatsoever for any direct, indirect and/or consequential loss (including any claims for loss of profit) arising from any use of and/or reliance upon this document and/or further communication given in relation to this document. This document is not to be construed as an offer or a solicitation of an offer to buy or sell any securities. The DBS Group, along with its affiliates and/or persons associated with any of them may from time to time have interests in the securities mentioned in this document. The DBS Group may have positions in, and may effect transactions in securities mentioned herein and may also perform or seek to perform broking, investment banking and other banking services for these companies. Any valuations, opinions, estimates, forecasts, ratings or risk assessments herein constitutes a judgment as of the date of this report, and there can be no assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk assessments. The information in this document is subject to change without notice, its accuracy is not guaranteed, it may be incomplete or condensed and it may not contain all material information concerning the company (or companies) referred to in this report. The valuations, opinions, estimates, forecasts, ratings or risk assessments described in this report were based upon a number of estimates and assumptions and are inherently subject to significant uncertainties and contingencies. It can be expected that one or more of the estimates on which the valuations, opinions, estimates, forecasts, ratings or risk assessments were based will not materialize or will vary significantly from actual results. Therefore, the inclusion of the valuations, opinions, estimates, forecasts, ratings or risk assessments described herein IS NOT TO BE RELIED UPON as a representation and/or warranty by the DBS Group (and/or any persons associated with the aforesaid entities), that: (a) such valuations, opinions, estimates, forecasts, ratings or risk assessments or their underlying assumptions will be achieved, and (b) there is any assurance that future results or events will be consistent with any such valuations, opinions, estimates, forecasts, ratings or risk

assessments stated therein. Any assumptions made in this report that refers to commodities, are for the purposes of making forecasts for the company (or companies) mentioned herein. They are not to be construed as recommendations to trade in the physical commodity or in the futures contract relating to the commodity referred to in this report. DBS Vickers Securities (USA) Inc ("DBSVUSA")"), a U.S.-registered broker-dealer, does not have its own investment banking or research department, has not participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months and does not engage in market-making. ANALYST CERTIFICATION The research analyst(s) primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views. The analyst(s) also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report. As of 4 Jan 2016, the analyst(s) and his/her spouse and/or relatives who are financially dependent on the analyst(s), do not hold interests in the securities recommended in this report (“interest” includes direct or indirect ownership of securities).


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COMPANY-SPECIFIC / REGULATORY DISCLOSURES

1. DBS Bank Ltd., DBS Vickers Securities (Singapore) Pte Ltd (“DBSVS”), their subsidiaries and/or other affiliates have proprietary positions in CapitaLand, City Development, Ezion Holdings, Mapletree Greater China Commercial Trust, ST Engineering, Thai Beverage Public Company, Venture Corporation recommended in this report as of 30 Nov 2015

2. DBS Bank Ltd does not market make in equity securities of the issuer(s) or company(ies) mentioned in this Research Report.

3.

Compensation for investment banking services: DBSVUSA does not have its own investment banking or research department, nor has it participated in any public offering of securities as a manager or co-manager or in any other investment banking transaction in the past twelve months. Any US persons wishing to obtain further information, including any clarification on disclosures in this disclaimer, or to effect a transaction in any security discussed in this document should contact DBSVUSA exclusively.

4. Peter Seah Lim Huat, Chairman of DBS Group Holdings, is a Deputy Chairman of CapitaLand as of 28 Feb 2015. Euleen Goh Yiu Kiang, a member of DBS Group Holdings Board of Directors, is a Director of CapitaLand as of 28 Feb 2015.

Woo Foong Pheng (Mrs Ow Foong Pheng), a member of DBS Group Holdings Board of Directors, is a Director of Mapletree Greater China as of 28 Feb 2015.

RESTRICTIONS ON DISTRIBUTION General This report is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or

located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

Australia This report is being distributed in Australia by DBS Bank Ltd. (“DBS”) or DBS Vickers Securities (Singapore) Pte Ltd (“DBSVS”), both of which are exempted from the requirement to hold an Australian Financial Services Licence under the Corporation Act 2001 (“CA”) in respect of financial services provided to the recipients. Both DBS and DBSVS are regulated by the Monetary Authority of Singapore under the laws of Singapore, which differ from Australian laws. Distribution of this report is intended only for “wholesale investors” within the meaning of the CA.

Hong Kong This report is being distributed in Hong Kong by DBS Vickers (Hong Kong) Limited which is licensed and regulated by the Hong Kong Securities and Futures Commission.

Indonesia This report is being distributed in Indonesia by PT DBS Vickers Securities Indonesia.

Malaysia This report is distributed in Malaysia by AllianceDBS Research Sdn Bhd ("ADBSR"). Recipients of this report, received from ADBSR are to contact the undersigned at 603-2604 3333 in respect of any matters arising from or in connection with this report. In addition to the General Disclosure/Disclaimer found at the preceding page, recipients of this report are advised that ADBSR (the preparer of this report), its holding company Alliance Investment Bank Berhad, their respective connected and associated corporations, affiliates, their directors, officers, employees, agents and parties related or associated with any of them may have positions in, and may effect transactions in the securities mentioned herein and may also perform or seek to perform broking, investment banking/corporate advisory and other services for the subject companies. They may also have received compensation and/or seek to obtain compensation for broking, investment banking/corporate advisory and other services from the subject companies.

Wong Ming Tek, Executive Director, ADBSR

Singapore This report is distributed in Singapore by DBS Bank Ltd (Company Regn. No. 196800306E) or DBSVS (Company Regn No. 198600294G), both of which are Exempt Financial Advisers as defined in the Financial Advisers Act and regulated by the Monetary Authority of Singapore. DBS Bank Ltd and/or DBSVS, may distribute reports produced by its respective foreign entities, affiliates or other foreign research houses pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, DBS Bank Ltd accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact DBS Bank Ltd at 6327 2288 for matters arising from, or in connection with the report.

Thailand This report is being distributed in Thailand by DBS Vickers Securities (Thailand) Co Ltd. Research reports distributed are only intended for institutional clients only and no other person may act upon it.

United Kingdom

This report is being distributed in the UK by DBS Vickers Securities (UK) Ltd, who is an authorised person in the meaning of the Financial Services and Markets Act and is regulated by The Financial Conduct Authority. Research distributed in the UK is intended only for institutional clients.

Dubai

This research report is being distributed in The Dubai International Financial Centre (“DIFC”) by DBS Bank Ltd., (DIFC Branch) having its office at PO Box 506538, 3rd Floor, Building 3, East Wing, Gate Precinct, Dubai International Financial Centre (DIFC), Dubai, United Arab Emirates. DBS Bank Ltd., (DIFC Branch) is regulated by The Dubai Financial Services Authority. This research report is intended only for professional clients (as defined in the DFSA rulebook) and no other person may act upon it.


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United States This report was prepared by DBS Bank Limited. DBSVUSA did not participate in its preparation. The research analyst(s) named on this report are not registered as research analysts with FINRA and are not associated persons of DBSVUSA. The research analyst(s) are not subject to FINRA Rule 2241 restrictions on analyst compensation, communications with a subject company, public appearances and trading securities held by a research analyst. This report is being distributed in the United States by DBSVUSA, which accepts responsibility for its contents. This report may only be distributed to Major U.S. Institutional Investors (as defined in SEC Rule 15a-6) and to such other institutional investors and qualified persons as DBSVUSA may authorize. Any U.S. person receiving this report who wishes to effect transactions in any securities referred to herein should contact DBSVUSA directly and not its affiliate.

Other jurisdictions

In any other jurisdictions, except if otherwise restricted by laws or regulations, this report is intended only for qualified, professional, institutional or sophisticated investors as defined in the laws and regulations of such jurisdictions.

DBS Bank Ltd. 12 Marina Boulevard, Marina Bay Financial Centre Tower 3

Singapore 018982 Tel. 65-6878 8888, Company Regn. No. 196800306E

04/01/2016 Wired Weekly - DBS Bank 04/01/2016 4 January 2016 Singapore Traders Spectrum Wired Weekly...

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