Reports » Singapore

Singapore stock market and companies daily report (Keppel Land, Singapore Technologies, OSIM International) (July 21, 2010)

Contributed by Shares Investment

By Shares Investment

US Stocks Extend Rally
US stocks rose, erasing an early slide, amid speculation the Federal Reserve will take steps to spur the economy. The Dow Jones Industrial Average gained 0.7%, after being down double that earlier. The S&P and Nasdaq also finished higher – both up more than 1%. Some speculated that the rally may have been in anticipation that the Fed might eliminate interest paid on excess bank reserves held at the Fed, an attempt to force banks to lend money instead of parking it at the Fed. Meanwhile oil prices rose to US$77.44 a barrel and gold jumped to US$1,191.50 an ounce. The euro fell against the US dollar from a more than 2-month high.

KepLand’s 2Q10 Net Profit Rises 20.3%
Keppel Land (KepLand) registered a 20.3% rise in its net profit, largely driven by strong residential sales in Singapore and China, and growth in its fund management and property investment businesses. This was despite a 19% fall in revenue. For 1H10, KepLand’s net profit was up 42% YoY. Revenue dropped 9%. KepLand plans to launch the first phase of a residential project next to Lakeside MRT station by year-end. KepLand is also eyeing the residential sales opportunities in China. Meanwhile, KepLand’s Ocean Financial Towers (OFT) is set to be complete next year, and is already 63% pre-committed. Overall commitment for the Marina Bay Financial Centre (MBFC) is at 80%, ahead of full completion in 2012.

Significance: With the residential market performing well and improving office leasing, KepLand may be able to capitalise on the improving market sentiment, with plans to launch its residential project and the high pre-commitment rate at OFT and MBFC.

ST Engineering Arm In JV To Set Up Aircraft Repair Facility
Singapore Technologies Engineering’s unit, ST Aerospace, will partner Guangdong Airport Management Corporation (GAMC) to set up a commercial aircraft heavy maintenance facility in China. They will invest US$99m in a joint venture company named ST Aerospace (Guangzhou) Aviation Services, which will be operated and managed by ST Aerospace. ST Aerospace will own a 49% stake, and GAMC the other 51%. Construction is expected to take about 2 years, after which the facility will provide maintenance and modification services for Boeing and Airbus aircraft. The JV brings the number of ST Aerospace’s China establishments to 4.

Significance: With ST Aerospace’s 3 other China establishments, this latest JV will enhance and complement ST Aerospace’s Chinese business operations.

OSIM’s 2Q10 Net Profit Surges 142%
OSIM International’s (OSIM) 2Q10 net profit more than doubled to $12.1m due to new product innovation and better operating efficiency. Revenue grew 12% to $131m. For 1H10, net profit grew 146% to $20.1m while revenue was up 22% to $259m. In the first half, OSIM opened 32 outlets around the world, boosting its global network of outlets to 1,074 as at end Jun-10. OSIM’s focus on China continued to grow in 2Q10, with revenue from North Asia accounting for 60% of total revenue. The expansion in China is set to continue, with OSIM planning to open another 30 to 40 outlets there in 2H10. It will also add 30 to 50 Richlife outlets, which sell nutritional supplements, to the existing 48 in China by year-end.

Significance: With OSIM’s continual product innovation and expansion plans, the company is well-positioned to ride on the increasing wealth and consumer demand from the middle class, particularly in China.

This article is contributed by Shares Investment. Visit Sharesinv.com for the latest Singapore, Malaysia and China stock market news and reports.