Singapore

• SCLX is filling a much-needed area of the health care sector, that of developing non-opioid pain relief products.
• The company already has commercialized products that are proven to improve patients’ lives.
• The company announced a merger between a SPAC and a Scilex subsidiary that is developing a non-opioid novel injectable corticosteroid, which will set up a spinoff of the combined entity in early 2025.

• kopi-C with Far East Orchard’s Group CEO: ‘We’re building an enduring Singapore real estate enterprise’ Nearly a decade after entering the student housing market in the United Kingdom in 2015, Singaporean real estate company Far East Orchard continues to see massive potential for growth.
• Established since 1967, Far East Orchard has a track record in real estate development, investment and management across residential, commercial, hospitality and Purpose-Built Student Accommodation (“PBSA”) properties in Australia, Japan, Malaysia, Singapore, and the United Kingdom (“UK”).

• Capitaland Integrated Commercial Trust (CICT SP) is looking to raise around S$350m (US$267m) in its primary placement. Included in the issuance is a preferential offering to raise an additional S$757m.
• The proceeds will be geared towards acquiring a 50% interest in the ION Orchard mall from its Sponsor.
• In this note, we run the deal through our ECM framework and comment on deal dynamics.

• Institutions were net buyers of Singapore stocks over the five trading sessions spanning August 23 through to August 29, with S$69.5 million of net institutional inflow, adding to the S$184.7 million of net inflow over the preceding five sessions.
• This followed the buy back of 3.4 million shares at an average price of S$2.56 per share over the preceding five sessions.
• Zheneng Jinjiang Environment Holding Company also bought back 0.5 million shares at an average price of S$0.34 per share.

• CTBC’s (likely) goal is to boost Shin Kong (2888 TT)‘s shares, so as to make the Taishin Financial Holding (2887 TT) merger unpalatable for Shin Kong shareholders. That smells of opportunity.
• Jardine Matheson Holdings (JM SP) is trading cheap to NAV and its implied stub. It may well get cheaper.
• Toyota Motor (7203 JP)‘s resulting supply/demand profile is mixed, but on balance, expect to see positive demand into the H1 earnings announcement. Watch for another buyback possibly announced then.

• In August, multiple signs of an improving outlook for manufacturing and trade, have included a four-month high in ASEAN Manufacturing PMI expectations, a projected recovery in Singapore’s manufacturing sector driven by strong electronics demand, and a significant month-to-month rebound in Singapore’s Industrial Production in July.
• Since 6 August, the iEdge SG Adv Manufacturing Index has rebounded 5%, recovering most of the declines in the first week of the month.
• For the month through to 28 August, the top-performing actively traded stocks in the iEdge SG Adv Manufacturing Index included SATS, UG Healthcare Corporation, Medtecs International Corporation, Thai Beverage, and Willas-Array Electronics (Holdings).

• I see Jardine Matheson Holdings (JM SP)‘s discount to NAV and implied stub at 12-month lows.
• Recent interim results were okay. Stripping out DFI Retail Group Holdings (DFI SP)‘s outperformance, the remainder of the Jardine stable delivered weaker numbers. 
• Further afield, the implied stub is marginally below the long-term average since the Jardine Strategic Holdings (JS SP) circularity was collapsed in April 2021. 

• Goh Peng Ooi, the Executive Chairman and founder, has made a voluntary unconditional general Offer for the 25.9% in Silverlake Axis (SILV SP) not held.
• The S$0.36/share cash Offer for the software solutions play is a 20% premium to last close. Or a 31.9% premium to the 12-month VWAP.
• The quirk in the terms is the option to receive A$0.30/share (in cash), plus one new redeemable preference share in the Offeror, to be redeemed at A$0.18/share after five years. 

• Keppel Infrastructure Trust (KIT SP) is looking to raise around S$206m (US$158m) in its primary placement.
• Proceeds will be used to pay down its bridge loan facility linked to its Ventura acquisition. KIT also appears to have secured its unitholders’ approval for the raising earlier. 
• In this note, we run the deal through our ECM framework and comment on deal dynamics.

• Silverlake Axis (SILV SP) has disclosed a voluntary unconditional offer from the Goh family and Ikhlas Capital. The default cash consideration is S$0.36, a 20.0% premium to the undisturbed price.
• The combi consideration is S$0.30 in cash and one new redeemable preference share (RPS) in the offeror, which will be mandatorily redeemed after five calendar years at S$0.18 per RPS.
• While not declared final, the offer is reasonable but not a knockout bid. The offeror is likely to use the voluntary delisting method to privatise Silverlake.

• Institutions were net buyers of Singapore stocks over the five trading sessions spanning Aug 16 to 22, with S$184.7 million of net institutional inflow.
• Leading the net institutional inflow were DBS, Singapore Exchange (SGX), Sats, UOB, Jardine Cycle & Carriage, Seatrium, Mapletree Industrial Trust, OCBC, Singtel and Singapore Technologies Engineering.
• Between Aug 15 and 16, Wee Investments acquired two million shares of UOL at an average price of S$5.21 per share.

• In JTC’s latest market report for the second quarter of 2024, it noted that industrial rents rose 1 per cent quarter on quarter, recording the slowest rate of increase since Q1 2022 following the Covid-pandemic recovery.
• On a year-on-year (yoy) basis, industrial rents are still up 6.6 per cent.
• Overall occupancy rates rose 0.3 percentage point to 89 per cent as new demand continues to outpace supply increases.

• Global focus on key economic indicators for a smooth US landing has led to four stable STI sessions with a 40-point range and 8% gain, as markets look to the US August unemployment report on 6 Sep and potential Fed Funds Rate cut on 18 Sep.
• Institutions have also been net buyers over the 4 sessions, with S$171 million of net inflow, led by Financials, REITs, and SATS.
• Beyond STI constituents, stocks that contributed to the net 4-session institutional inflow included Lendlease Global REIT, NetLink NBN Trust, iFAST Corp, Keppel DC REIT, CLINT, Suntec REIT & Nam Cheong.

The Q125 results shine a light on the latest initiatives to underpin the inherent value within Singapore Post, which include a review of the Australian operations and ongoing discussions with the Singapore government on postal services. SingPost’s transformation from a post and parcel delivery company into a global logistics operator appears to have slipped under the radar of investors and now offers an opportunity for investors to reassess its potential. Our forecasts and valuation are unchanged and we believe there is now c 60% upside in the share price.

• Technology firm Trek 2000 has grown through innovation.
• If you have ever used the ubiquitous thumb drive or transferred your holiday photographs wirelessly from your camera, it’s the innovation of Singaporean technology firm Trek 2000 International Ltd. (Trek2000) that made it possible.
• Tan emphasises that concentrating on these three P’s is how Trek 2000 will distinguish itself in the increasingly crowded renewable energy market.