Duty Free - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/10/19	Lim & Tan	Duty Free	0.192	0	Accumulate

Stock calls for 7 May 2019

Date	Analyst	Company	Last	Target	Call	Valuation
05/07/19	DMG & Partners	APAC Realty	0.555	0.72	Buy
05/07/19	DBS Vickers	Breadtalk	0.835	0.92	Hold
05/07/19	DMG & Partners	CSE Global	0.475	0.61	Buy	DCF, PER13.7x FY19
05/07/19	Lim & Tan	CSE Global	0.475	0	Buy
05/07/19	OCBC	DBS	26.53	27.5	Hold
05/07/19	DMG & Partners	Delfi	1.3	1.68	Buy	DCF, PER28x FY19
05/07/19	DMG & Partners	EC World Reit	0.77	0.84	Buy
05/07/19	CIMB	Frasers Property	1.85	2.08	Add
05/07/19	DMG & Partners	Fu Yu	0.21	0.24	Buy	DCF
05/07/19	DMG & Partners	HRnetGroup	0.77	1.06	Buy	DCF
05/07/19	DBS Vickers	Koufu	0.77	0.8	Hold	PER17x FY19
05/07/19	UOB Kay Hian	Netlink	0.825	0.92	Buy	DCF
05/07/19	DMG & Partners	Silverlake	0.61	0.65	Buy	DCF
05/07/19	DMG & Partners	Starhill	0.74	0.78	Buy	DDM
05/07/19	Lim & Tan	Sunningdale	1.35	0	Hold
05/07/19	DMG & Partners	UG Healthcare	0.18	0.32	Buy	PER10x FY20
05/07/19	OCBC	UOB	25.85	27.3	Hold

Do not subscribe to Luckin coffee ipo! Why?

https://www.businesstimes.com.sg/consumer/gic-backed-luckin-coffee-seeks-to-raise-up-to-us510m-in-us-ipo

I've heard too many news about this coffee startup.

Do you know where does this startup source its coffee beans?
It sources its coffee beans from Taiwan which is not a coffee producing country and the coffee beans are not of good quality.  A real coffee company will source its coffee beans from coffee producing countries and not from Taiwan.  Why is this company sourcing coffee beans from Taiwan? I leave it to your imagination.

This coffee startup is burning cash like hell, just like the bike sharing business.  It has to offer discounts and deals just to sell its coffee.  Without these discounts and deals, it cannot sell at all.

The short-sellers will target and publish SELL reports on this coffee startup in the future because it has weak fundamentals and a flawed business concept.

Hopefully, GIC is able to get out of this company soon before it suffers from a great burnout.

How the China RRR cut will impact its economy?

https://finance.yahoo.com/news/china-steers-credit-small-firms-034303771.html

The China RRR cut will release RMB$280b into the economy.

Let me offer a simple explanation of RRR.

The RRR is imposed on banks by the central bank to prevent liquidity and bankruptcy issues such as bank run.

When a bank takes a deposit of $100, it is a debt owed to the bank customer and the bank will pay the bank customer a deposit interest.  The bank will use the debt (deposit) for bank lending to earn a higher loan interest so that the bank can cover the deposit interest and earn a profit.  However, the central bank will not allow the bank to make a full loan of the deposit ($100) because it will create a liquidity risk.  Therefore, the central bank imposes a required reserve ratio (RRR) on the bank and limits the bank lending on its deposit.

For example:

If the RRR is 20%, the bank can only make a loan of $80 out of every $100 deposit.

If the bank pays a $2 interest on every $100 deposit, its cost of debt (deposit) is 2%.

When the RRR is 20% and the bank still pays a $2 interest, its cost of debt is 2.5% (2/80).  Therefore, the cost of debt for the bank increases with higher RRR.

When the RRR is lowered, the cost of debt is lowered too and the bank can earn a profit more easily with lower loan interest.

In conclusion, a lower RRR is meant to boost monetary supply and local consumption in the economy.  In other words, this is a QE policy.

France has done the right thing for its pedestrians.

https://sg.finance.yahoo.com/news/france-ban-e-scooters-pavements-september-090821006.html

Well done! France is doing the right thing.

E-scooters put pedestrians in danger on the pavements.

They ride recklessly at high speeds and don't give way to pedestrians on the pavements.  They are a nuisance as they expect pedestrians to give way to them by honking.

DISA - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
02/19/19	Amfrasers	DISA	0.003	0	Cease Coverage

Delfi - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/02/19	DMG & Partners	Delfi	1.32	1.59	Buy
03/01/19	DMG & Partners	Delfi	1.45	1.68	Buy	DCF, PER28x FY19
04/05/19	DMG & Partners	Delfi	1.3	1.68	Buy

DBS - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/02/19	DMG & Partners	DBS	23.69	29.8	Buy	GGM, PB1.54x FY19
01/03/19	CIMB	DBS	23.49	27	Hold	PER10.7x FY20
01/03/19	JP Morgan	DBS	23.49	29	Overweight
01/08/19	UOB Kay Hian	DBS	23.75	28.5	Buy
01/08/19	Jefferies	DBS	23.75	28.5	Buy
01/29/19	CIMB	DBS	24.22	29	Add	GGM, PB1.4x CY19
01/31/19	Kim Eng	DBS	23.94	30.18	Buy	DDM
02/01/19	phillip	DBS	23.92	29.02	Buy
02/08/19	UOB Kay Hian	DBS	24.33	28.5	Buy
02/12/19	Kim Eng	DBS	24.36	30.18	Buy
02/18/19	DMG & Partners	DBS	24.74	29.8	Buy
02/18/19	Lim & Tan	DBS	24.74	0	Buy
02/19/19	Jefferies	DBS	25.2	28.5	Buy
02/19/19	OCBC	DBS	25.2	29.31	Buy
02/19/19	DMG & Partners	DBS	25.2	28.8	Buy	GGM, PB1.5x FY19
02/19/19	phillip	DBS	25.2	29	Buy	GGM, PB1.5x FY19
02/19/19	Kim Eng	DBS	25.2	29.56	Buy	DDM
02/19/19	CIMB	DBS	25.2	29	Add	GGM
02/19/19	UOB Kay Hian	DBS	25.2	28.4	Buy
02/20/19	Macquarie	DBS	25.1	27	Neutral	PB
02/26/19	Amfrasers	DBS	25.18	27.7	Buy	RIM
03/04/19	phillip	DBS	25.08	29	Buy
03/07/19	Kim Eng	DBS	25.36	29.56	Buy
03/11/19	CIMB	DBS	25.06	29	Add
03/13/19	DMG & Partners	DBS	25.3	28.8	Buy	GGM, PB1.5x FY19
03/26/19	OCBC	DBS	25.12	29.31	Buy
04/01/19	UOB Kay Hian	DBS	25.23	28.4	Buy
04/02/19	phillip	DBS	25.59	29	Buy
04/10/19	DMG & Partners	DBS	27	29.6	Buy	PB1.43x FY20
04/11/19	CIMB	DBS	26.97	29	Add
04/22/19	UOB Kay Hian	DBS	27.4	30.3	Buy	GGM, PB1.57x FY19
04/22/19	Kim Eng	DBS	27.4	29.56	Buy
04/29/19	Lim & Tan	DBS	27.41	0	Buy
04/30/19	Macquarie	DBS	28.4	27	Neutral
04/30/19	phillip	DBS	28.4	29	Accumulate	GGM, PB1.5x FY19
04/30/19	OCBC	DBS	28.4	29.18	Hold	Buy @ $27.50 or lower
04/30/19	CIMB	DBS	28.4	30	Add	GGM, PB1.54x
04/30/19	DMG & Partners	DBS	28.4	30.8	Buy	PB1.5x FY20
04/30/19	Lim & Tan	DBS	28.4	30	Hold
05/02/19	Amfrasers	DBS	28.25	27.7	Hold
05/02/19	Jefferies	DBS	28.25	31.5	Buy	PER13.1x FY20

Stock calls for 6 May 2019

Date	Analyst	Company	Last	Target	Call	Valuation
05/06/19	Phillip	ART	1.21	1.36	Buy	DDM
05/06/19	Kim Eng	First Resources	1.82	2.03	Buy	PER17x FY19
05/06/19	DBS Vickers	Frasers Property	1.89	2.3	Buy
05/06/19	DBS Vickers	Hi-P	1.44	1.41	Hold	PER12x FY19
05/06/19	Kim Eng	Hi-P	1.44	1.22	Sell	PB1.5x FY19
05/06/19	Tayrona	Sanli Env	0.18	0.234	Overweight
05/06/19	phillip	Sembcorp Marine	1.67	1.76	Neutral	PB1.6x
05/06/19	OCBC	Sembcorp Marine	1.67	1.77	Hold
05/06/19	Amfrasers	Sembcorp Marine	1.67	2.48	Buy
05/06/19	DBS Vickers	Sembcorp Marine	1.67	2.4	Buy	PB2.1x FY19
05/06/19	Phillip	Starhub	1.58	1.62	Neutral
05/06/19	UOB Kay Hian	Starhub	1.58	1.45	Sell	DCF
05/06/19	CIMB	Starhub	1.58	1.65	Hold	DCF (10% discount)
05/06/19	DMG & Partners	Starhub	1.58	1.72	Neutral	DCF
05/06/19	OCBC	Starhub	1.58	1.64	Hold
05/06/19	Kim Eng	Starhub	1.58	2	buy	DCF
05/06/19	Jefferies	UOB	27.77	31	Buy	PER12.4x FY19
05/06/19	OCBC	UOB	27.77	28.9	Hold	GGM, PB1.2x
05/06/19	phillip	UOB	27.77	30.87	Accumulate	GGM, PB1.4x FY19
05/06/19	CIMB	UOB	27.77	29.58	Add	GGM, PB1.3x
05/06/19	Lim & Tan	UOB	27.77	0	Buy on weakness

China VP Liu has changed his US travel plan.

https://www.businesstimes.com.sg/government-economy/china-vice-premier-liu-will-still-travel-to-us-this-week-but-will-shorten-trip

As Trump threatened to impose additional China tariffs on Friday (10 May), China VP Liu had decided to defer his US travel plan to Thursday (9 May) and would reach the US on Friday (10 May).  He wanted to see if the US would impose the threat against China. Then, he would leave the US on Saturday.

Basically, there is nothing much VP Liu can discuss with the US as the time is too short to produce any productive outcome.  This is a wasted trip unless Trump is willing to change his unreasonable threat.

China is preparing a trade war with the US now.

https://sg.finance.yahoo.com/news/china-central-bank-cut-requirements-banks-trade-tensions-034114168--sector.html

The China RRR cut deserves some attention because it is imposed after Trump's threat on Sunday.

The Chinese are preparing for a trade war with the US because China is trying to stimulate its local consumption with the RRR cut since it is a consuming nation now.

What's worrying to the global world is that the Chinese are consuming more local made products and reducing their imports in this trade war.  This will cause a global recession and many export-oriented countries like SK, Japan, SG, etc will suffer tremendously.

The US has issued a warning to anti-Israel countries such as Malaysia.

https://sg.news.yahoo.com/u-may-review-ties-countries-deemed-anti-israel-142945853.html

The US has issued a warning in public to anti-Israel countries like Malaysia.

Malaysia is one of the anti-Israel countries.

https://www.channelnewsasia.com/news/sport/paralympics-malaysia-stripped-of-right-to-host-world-11172762

This will force Malaysia to kowtow to China because Malaysia is helpless against the US.  Malaysia has to find a big country to join forces to fight off the US.

The US is playing a stupid political game with Iran.

https://sg.news.yahoo.com/u-deploying-carrier-bombers-middle-east-warning-iran-010502968.html

The US can send a carrier strike group to Iran but the Russian also can send its naval warships to Iran too.  The US dares not attack the Russian warships as this will escalate into a WW3 since both countries have large arsenals of nuclear weapons.  China also may get involved as it is a major customer of Iran.

Trump threatens China with more tariffs again.

https://sg.news.yahoo.com/trump-vows-tariff-hike-chinese-goods-escalating-tension-004818460.html

China should just walk away from the trade talk because the US economy would just collapse if Trump imposed more tariffs.  The trade war devastation is starting to creep up in the US economic data and the US government is trying to fudge the economic numbers now.

http://sg-stock.blogspot.com/2019/05/discrepancies-in-us-employment-data.html

We've found discrepancies in the US manufacturing employment datum because it is not in sync with the PMI employment sub-index.  The PMI employment sub-index fell but the manufacturing employment datum rose.

Discrepancies in the US employment data.

https://www.channelnewsasia.com/news/business/us-job-growth-surges--unemployment-rate-drops-to-3-6-percent-11499716

US job growth surged in April and the unemployment rate dropped.

However, the ISM Manufacturing PMI data in April showed otherwise.

http://sg-stock.blogspot.com/2019/05/us-ism-manufacturing-pmi-fell-in-april.html

The employment sub-index under the April PMI showed it dropped from 57.5% to 52.4%, an almost 10% drop.  A drop of such magnitude is serious!

This could only mean that the manufacturing industry was shedding workers but workers were increasing in other sectors.  Right? No!

The US employment data showed that the manufacturing sector increased by 4,000 jobs in April and contradicted the April PMI data.  A 4,000 job increase couldn't cause the employment sub-index under PMI to drop by 10%.

Something fishy is going here.  Like I said before, the demon was hiding in the details.

Baltic dry index - 1032

Today, Thursday, May 02 2019, the Baltic Dry Index climbed by 1 point, reaching 1032 points.

Baltic Dry Index is compiled by the London-based Baltic Exchange and covers prices for transported cargo such as coal, grain and iron ore. The index is based on a daily survey of agents all over the world. Baltic Dry hit a temporary peak on May 20, 2008, when the index hit 11,793. The lowest level ever reached was on Wednesday the 10th of February 2016, when the index dropped to 290 points.

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Related stocks: Sembcorp Marine, Cosco & Pan ocean.

US rig count - 990

Related stocks: Keppel Corp, Sembcorp Marine & Cosco,

Dasin Retail - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
02/15/19	phillip	Dasin Retail	0.885	0.95	Accumulate	DDM
02/28/19	phillip	Dasin Retail	0.885	0.94	Accumulate	DDM, PB0.64x

Dairy Farm - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
03/04/19	DMG & Partners	Dairy Farm	8.57	8.64	Neutral	DCF
03/04/19	DBS Vickers	Dairy Farm	8.57	8.44	Hold	Sum of parts
03/06/19	CIMB	Dairy Farm	8.33	8.54	Hold	PER23.5x FY20
03/20/19	DMG & Partners	Dairy Farm	7.41	8.25	Buy	DCF
04/05/19	DMG & Partners	Dairy Farm	8.14	8.25	Buy

CSE Global - Stock calls

Date	Analyst	Company	Last	Target	Call	Valuation
01/04/19	UOB Kay Hian	CSE Global	0.385	0.59	Buy
01/07/19	DMG & Partners	CSE Global	0.395	0.59	Buy	DCF
01/11/19	Lim & Tan	CSE Global	0.395	0	Buy
01/15/19	CIMB	CSE Global	0.405	0.56	Add	PER13.5x FY20
01/22/19	Amfrasers	CSE Global	0.43	0.57	Buy
02/08/19	UOB Kay Hian	CSE Global	0.455	0.59	Buy
02/22/19	DMG & Partners	CSE Global	0.465	0.6	Buy	DCF
02/22/19	CIMB	CSE Global	0.465	0.6	Add	PER13.5x FY19
02/22/19	UOB Kay Hian	CSE Global	0.465	0.62	Buy
03/05/19	Amfrasers	CSE Global	0.505	0.58	Buy
03/26/19	UOB Kay Hian	CSE Global	0.54	0.62	Buy
03/26/19	DMG & Partners	CSE Global	0.54	0.61	Buy	DCF
03/26/19	CIMB	CSE Global	0.54	0.6	Add
04/02/19	Lim & Tan	CSE Global	0.545	0	Buy