Brokers' take

OCBC Bank > Neutral Phillip Securities Research, July 28 July 28 close: S$11.39 Target price: S$10.81

WE are revising our loan-to-deposits ratio (LDR) forecast for OCBC from about 80 per cent to about 85 per cent as management indicated more flexibility to move the LDR higher. We thus increased our FY17e net interest income growth estimates from our previous 2 to 5 per cent. With rising economic sentiment and low volatility at the start of 2017 and the recovering Singapore housing market, we are revising our valuation to reflect these improvements. But we are cautious about OCBC's sensitivity to competition in the loans market; slightly more than half of its loans are pegged to board rates. Upgrade "neutral" with a higher target price of S$10.81.

Sembcorp Marine > Buy OCBC Investment Research, July 28 July 28 close: S$1.695 Target price: S$1.98