STOCKS NEWS SINGAPORE-OCBC raises Midas target price

Mon Oct 15, 2012 9:58pm EDT

OCBC Investment Research raised its target price on Midas Holdings Ltd, which supplies components for railway projects, to S$0.51 from S$0.435 and kept its 'buy' rating, citing brighter outlook for China's railway sector.

At 0144 GMT, shares of Midas were up 2.4 percent at S$0.425. They have jumped 28.8 percent since the start of the year, compared with the FTSE ST China Index's 0.4 percent rise.

According to China's Ministry of Railways, the country's total railway fixed asset investments for September surged 92.7 percent from a year ago to 72.7 billion yuan, OCBC said, indicating progressive recovery in its railway sector, which will benefit Midas.

Midas is likely to see re-rating catalysts when China resumes tendering of new high-speed passenger train car contracts in the near term, OCBC said.

"We believe that China's easing economic growth has provided strong impetus for the Chinese government to speed up its stimulus programmes on infrastructure spending, thus enhancing the outlook and prospects of the railway sector," said OCBC.

0949 (0149 GMT)

(Reporting by Charmian Kok in Singapore; Editing by Prateek Chatterjee; charmian.kok@thomsonreuters.com)

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9:33 STOCKS NEWS SINGAPORE-UOB upgrades Keppel REIT to 'buy'

UOB Kay Hian upgraded Keppel REIT, previously known as K-REIT Asia, to 'buy' and raised its target price to S$1.36 from S$1.26, on expectations of improving office rentals.

Units of Keppel REIT, which owns office buildings, were up 2.5 percent at S$1.22. They have jumped 47.3 percent since the start of the year, compared with the FTSE ST Real Estate Industrial Trust's 34 percent gain.

Keppel REIT said its third-quarter distribution per unit was 1.96 Singapore cents, in line with UOB's expectations and up 84.5 percent from a year earlier, helped by higher rents and property income.

"We anticipate office rentals to bottom out in the next 2-3 quarters, with K-REIT expected to remain resilient due to its near-full occupancies, long weighted leases and its highest exposure to Grade-A office assets in Singapore," UOB said in a report.

The rate of decline for office rentals in Singapore is slowing, and UOB expects Keppel REIT to start seeing positive rental reversions, while acquisitions in Australia will also contribute to further growth.

0911 (0111 GMT)

(Reporting by Charmian Kok in Singapore; Editing by Prateek Chatterjee; charmian.kok@thomsonreuters.com)