InvestIdeas

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Shares of Parkson Retail Asia, a department store operator with operations in Malaysia, Vietnam and Indonesia, will begin trading on the Singapore Exchange at 0100 GMT.

The company sold 147 million shares at S$0.94 each.

Source: Reuters

S'pore-listed Parkson shares open at S$1.05, 12 pct above IPO price

SINGAPORE, Nov 3 (Reuters) - Shares of department store operator Parkson Retail Asia Limited opened at S$1.05 in its Singapore debut on Thursday, 12 percent higher than the initial public offering price.

At 0101 GMT, Parkson Retail Asia shares were trading at S$1.07 on a volume of 6 million shares. The broader Straits Timex Index <.FTSTI> was 1.1 percent lower.

Parkson Retail Asia is the Asian retail arm of Malaysia's Parkson Holdings . The company, which owns a network of 50 stores across cities in Malaysia, Vietnam and Indonesia, sold 147 million shares at S$0.94 each.

It said in a statement that the firm issued 22.05 million more shares under an over-allotment option.

The Hongkong and Shanghai Banking Corporation Limited was the sole global coordinator and issue manager for the offering. HSBC was also the underwriter along with CIMB Securities .

Source: Reuters

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Singapore Hot Stocks-Parkson Retail surges on demand for defensive stocks

SINGAPORE, Nov 4 (Reuters) - Shares of Singapore-listed department store operator Parkson Retail Asia Ltd jumped as much as 9.3 percent on Friday, on hopes it will provide stable earnings in an economic slowdown.

At 0233 GMT, shares of Parkson Retail were 8.4 percent higher at S$1.225 with more than 8.2 million shares changing hands.

"Investors like the defensiveness of its business. They cater to the mid- to lower-end consumers, where spending should be relatively stable unless we see a very bad recession," said a dealer.

Parkson Retail, the Asian retail arm of Malaysia's Parkson Holdings , made its debut on the Singapore exchange on Thursday. It owns a network of 50 stores across cities in Malaysia, Vietnam and Indonesia.

Source: Reuters

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JPM raised their stake from 5.49% to 6.04%

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JPM increased their stake from 6.13 % To 7.01 %

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FV of S$1.50, NEUTRAL.

We have a DCF-derived TP of S$1.50 (WACC: 9.2% and terminal growth rate: 2%) which translates into FY13F P/E of 18x, in-line with its Southeast Asia peers in the department store space.

Over the past year, its HK-listed sister company, Parkson Retail Group (3368 HK), which operates 49 stores in China has traded at an average P/E of 23x while its Malaysian-listed parent company, Parkson Holdings (PKS MK) traded at 18x.

Source: DMG

Parkson Retail Asia: Emerging market consumption play

Ø Parkson Retail Asia is the ASEAN retail arm of the Parkson Group for the emerging markets, operating 53 stores in the region under the well-recognised Parkson brand.

Ø The stock has surged 57% since debuting on the SGX last November, on the back of strong same store sales growth in excess of 10%. Such growth is conceivable only in the emerging markets, where upside for consumption power is immense.

Ø Another factor in its favour is the plentiful opportunities in new markets such as Cambodia and Myanmar. However, valuations are not enticing at 21x FY Jun12.


Source: Kim Eng

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Time to bargain shop

OUTPERFORM - Maintained
Share Price S$1.42 - Tgt. S$1.80

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3Q12 was weaker than expected due to changes in the promotional calendar and soft consumer spending in Vietnam.

Still, Malaysia’s SSSG slowdown should reverse in 4Q, while Indonesia stays strong.

These are expected to provide catalysts.

3Q core profit (20% of our and consensus FY12) is 5% below expectation.

We cut EPS by 1-4% to factor in likely prolonged sales weakness in Vietnam but maintain Outperform and target price (20x CY13 EPS, 20% discount to SEA retail peers).

Maintain Outperform.


Source: CIMB

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Earnings exceeded expectations, upgrade to BUY

Parkson reported a 6% growth in 3QFY12 PATMI to S$9.7m, on the back of a 20% growth in revenue to S$106.7m.

9M12 earnings exceeded ours and consensus expectations accounting for 80% of our FY12F due to:
1) better gross margins and
2) lower operating costs.

All markets recorded strong 9M12 SSS growth with Malaysia (+9.5%), Vietnam (+11.8%) and Indonesia (+9.8%).

We raise our FY12-14F earnings forecast by 2-9%. Taking into account the S$72m cash raised from its IPO, the Group is sitting on S$188m cash.


Upgrade to BUY with a new higher DCF-derived TP of S$1.68 (WACC: 9.2%, terminal growth rate: 2%). This translates into 19.6x FY13F P/E (-1SD of its mean historical trading band) which we feel is justified given the stock offers exposure into three high growth markets of Malaysia, Vietnam and Indonesia.


Source: DMG

not vested

Summer is almost here again

OUTPERFORM - Maintained
Share Price S$1.45 - Tgt. S$1.80

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Management has confirmed that most of 3Q’s weaknesses will be reversed in 4Q, and SSSG in Malaysia and Indonesia in April and May are already back on track.

Although there are still macro headwinds in Vietnam, these have been more than priced in.

We stay positive on PRA’s growth outlook projected at 22% EPS CAGR from FY11 to FY14, and find the current valuation at 28% discount to S.E. Asian retailers’ peer average attractive.

Maintain Outperform and target price based on 20x CY13 EPS (~20% discount to peers).

Source: CIMB