3 top buys and 3 top sells for Singapore

BUYs

1. SingTel – SingTel’s high trading liquidity and exposure to regional Tier-1 cellcos make it a highly defensive stock to ride out the recessionary environment.

2. PLife REIT – Stable cash guarantee from formula structure of Parkway hospitals the key attraction in these times. No gearing and funding issues.

3. CCT – Likely to have no problems in refinancing. Share price is bashed down and already reflects recession rents and occupancies below previous recessions.

SELLs

1. Capitaland – As inventory in China residential markets start to build up, we expect Capitaland’s China exposure to be a negative. On top of that, current environment makes it difficult to fund AUM growth, eroding the merits of the Capitaland model.

2. SATS – There is limited potential for synergies from the acquisition of SFI, and maintain that the acquisition would increase the company's risk profile moving forward.

3. ST Engineering – We are negative on its US-based MRO business, given the outlook of an aviation slowdown and cost controls by airlines.

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