The team also points out that Sembcorp Marine is now in a “much stronger financial position” given its $1.5 billion capital raise, allowing it to take advantage of a potential upswing in the offshore construction sector.
Meanwhile, for BRC Asia, the team says the company is a proxy to the Singapore economy’s continued reopening and should benefit from the government’s infrastructure spending.
On the flip side, the team has opted to remove its short-term tactical call to short DBS and OCBC. “Our call to short financials worked well with DBS declining 5.3% m-o-m and OCBC falling by 6.9% m-o-m as Sea’s re-weighting within the MSCI Singapore index took place at the end of November,” the team explains.
The team has also taken out Sea and iFast, citing a lack of share price catalysts in the near team.
See also: OCBC’s CEO change ‘earlier’ than expected; Citi stays ‘neutral’ with target price 6.8% under
The alpha picks portfolio outperformed the Straits Times Index (STI) in November as markets were affected by news about the new omicron variant. The portfolio declined 4.1% m-o-m, compared to the 4.9% drop in the STI.
“Only Lendlease REIT had a positive return within our portfolio, with Sea (-16.2% m-o-m) and ComfortDelGro (-12.2%) exhibiting the highest share price declines,” the team says.
Photo: Bloomberg
