Singapore stocks to watch Wednesday: SGX, Yoma, SATS, China Everbright Water, Yangzijiang

Singapore CBD skylineSingapore CBD skyline

These are the Singapore stocks to watch on Wednesday, 30 May, 2018:

Singapore Exchange

Singapore Exchange said on Tuesday it would delay the launch of its Indian derivative successor products to the SGX NIfty product family.

SGX had planned to list the successor products before August, when the license for the SGX Nifty products expires. The new products were aimed at providing the same ability to invest and maintain risk exposure to the Indian capital markets and and at transitioning market participants before the SGX’s license deal with the National Stock Exchange of India (NSE) expires.

In a note in February, Goldman Sachs estimated that 10 percent of SGX’s derivatives business revenue comes from the Nifty F&O and rupee futures, which are its two key India offerings.

But in the statement on Tuesday, SGX said an interim injunction was granted to India Index Services and Products Ltd. (IISL), a subsidiary of the National Stock Exchange of India (NSE), on May 21, against the launch of SGX’s new India derivatives products.

“SGX was not able to contest this injunction as it was not given notice by IISL of its application for the injunction,” the company said in an SGX filing on Tuesday. But it added that the Bombay High Court has ordered arbitration, with a decision on the injunction expected by June 16.

While SGX will continue listing SGX Nifty contracts until August, based on its license agreement with IISL, the exchange said it would reschedule the launch of its new India derivatives products, pending the arbitration outcome.

“IISL’s action has adversely affected international investors who rely on SGX’s platform to manage the risks of their exposures to the Indian market, and significantly diminishes access to, and interest in the capital markets in India,” SGX said.

It added that it would contest the interim injunction and reserved its rights on any damages caused by IISL’s action.

SATS

SATS reported its fiscal fourth quarter profit attributable to the owners of the company fell 1.8 percent on-year to S$65.4 million, while revenue was down 0.5 percent at S$423.5 million. For the full fiscal year, profit attributable to the owners was up 1.4 percent at S$261.5 million, while revenue slipped 0.3 percent to S$1.72 billion, the company said in a filing to SGX on Wednesday.

For the full year results, SATS said license fees rose “significantly,” up by S$16.7 million, on the cessation of rebates, while depreciation and amortization charges rose by S$5 million, or 6.8 percent, due to higher capital expenditure. It added that other costs grew by S$12.6 million, largely on higher fuel consumption, cessation of grants and exchange losses.

The company proposed a final dividend of 12 Singapore cents a share, bringing the total dividend to 18 Singapore cents, it said.

“The group has gained ground this year despite a challenging operating environment. Our investment in new technologies helped us to alleviate price pressures, as we handled higher operating volumes with better productivity,” Alex Hungate, president and CEO of SATS, said in the statement.

Far East Orchard

Far East Orchard said its 70 percent-owned subsidiary Far East Hospitality Holdings (FEHH) entered a joint venture with Boo Han Holdings (BHH), which is part of Far East Organization, to buy a plot of land where a hotel will be built in Japan.

The 50-50 joint venture will purchase the land and hotel project for 8.198 billion yen, or around S$100.5 million, after the seller, Shimizu Corp., builds the hotel, with the deal expected to be completed in the second quarter of 2020, Far East Orchard said in a filing to SGX after the market close on Monday.

The hotel is intended to be branded under a Far East Hospitality hotel brand, it said.

Yoma Strategic

Yoma Strategic reported its fiscal fourth quarter net profit dropped 84.6 percent on-year to S$4.7 million, while revenue fell 48.2 percent to S$25.1 million. For the full fiscal year, net profit fell 20.3 percent on-year to S$33.9 million, while revenue declined 6.6 percent at S$107.8 million, the company said in a filing to SGX on Wednesday.

Full-year revenue declined mainly on lower revenue from real-estate sales, partially offset by revenue from non-real-estate businesses, particularly the consumer and automotive and heavy equipment divisions, which grew 33 percent on-year to S$65.2 million, it said. The non-real-estate businesses contributed 60.5 percent of full-year revenue, while real estate sales and rental/services revenue were at 21.2 percent and 18.3 percent respectively, it said.

The consumer business revenue grew 30.4 percent on-year to S$14.2 million for the full year as it opened more KFC stores, to reach its target of 22 in Myanmar, with a 23rd opening in Yangon since the fiscal year end, it said. It was targeting 32 stores by March 2019.

“Our diversification strategy has proven to be sound, with revenue growth in our non-real estate businesses offsetting the slowdown in the real estate market. We are seeing good opportunities in the consumer and financial services sectors,” Melvyn Pun, Yoma’s CEO, said in the statement. “Our investment in Wave Money, which has a network of more than 23,000 agents nationwide, will allow us to tap into the large unbanked population, particularly in communities outside of Yangon.”

In a separate filing on Wednesday, Yoma announced that a wholly owned subsidiary in Myanmar will bring Little Sheep, a chain of hot pot restaurants, to the country, with the first outlet expected to open in the fourth quarter of this year. Little Sheep currently has around 300 outlets globally.

China Everbright Water

China Everbright Water said it signed a supplemental deal with Dezhou Municipal Bureau of Housing and Urban-Rural Development, located in Shandong Province, to implement phase two of the Dezhou Nanyunhe Waste Water Treatment Project and to secure the Nanyunhe Effluent Deflouridation Project.

The total investment is approximately 158 million yuan, the environmental protection company said in a filing to SGX after the market close on Monday.

China Everbright Water had secured Nanyunhe Project phase one in 2011 and it commenced operation in 2013, the filing said. Phase two is an auxiliary project for water pollution prevention and control for the Haihe River basin, it said. Phase two’s concession period is around 25 years and phase one’s concession period will be extended to match the end of phase two’s, it said.

Yangzijiang Shipbuilding

Yangzijiang Shipbuilding said that a wholly owned subsidiary, Jiangsu Yangzi Xinfu Shipbuilding, disposed its 100 percent stake in China-based Taixing Yangzi Xinfu Ship Accessories Processing Co., or TYXSAPCO. The disposal was made to a third party for 1 million yuan, or around S$200,000, the company said in a filing to SGX on Monday after the market close.

The sale isn’t expected to have a significant impact on earnings for the current financial year, the filing said.

Interra Resources

Interra Resources said its 60 percent-owned joint venture Goldpetrol completed development well CHK 1207 in the Chauk oil field as the current highest rate oil producer in the Myanmar blocks operated by the venture.

CHK 1207 has been completed for 122 barrels of oil a day, and there were several remaining prospective oil reservoirs in the well that could be evaluated at a later time, it said in a filing to SGX after the market close on Monday.

CHK 1207 was drilled with a hired ZJ 750 rig, and Interra’s share of the drilling costs was funded via funds on hand, it said.

Spackman Entertainment

Spackman Entertainment said its subsidiary, Frame Pictures, won contracts to supply camera systems and equipment for upcoming South Korean drama series The Guests and historical movie Malmoi. The total contract value for the two deals is around 448.5 million won, or around US$403,650, subject to changes based on the final filming schedules, it said in a filing to SGX on Wednesday.

Tung Lok Restaurants

Tung Lok Restaurants reported a loss attributable to the owners of the company of S$1.40 million for the full fiscal year, swinging from a year earlier profit of S$422,000. Revenue for the fiscal year was S$85.72 million, up 0.8 percent on-year, the company said in a filing to SGX after the market close on Monday.

It said that during the fiscal year, the company conducted a review of the business to streamline non-performing outlets, which resulted in exceptional charges of S$1.1 million for impairment and write-offs of property, plant and equipment and closure costs for non-performing outlets as well as an allowance of S$100,000 for a doubtful debt related to a loan to an associate which closed an outlet.

Jumbo Group

Jumbo Group said in a filing to SGX after the market close on Monday that it opened its first Jumbo Seafood outlet in Xi’an in China, marking its sixth outlet on the mainland and the first outside of Shanghai and Beijing.