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Stocks to watch: Keppel, SIA Engineering, IHH Healthcare, Olam, Green Build
THE following companies saw new developments that may affect trading of their shares on Tuesday:
Keppel Corporation: Keppel Corp has signed an agreement with Envision AESC to invest US$50 million for a minority stake in intelligent lithium-ion battery company Envision AESC Group. Envision AESC Group recently acquired Automotive Energy Supply Corporation (AESC), a former venture between Nissan Motor Company (Nissan) and the NEC Group. It has also acquired the entire share capital of NEC Energy Devices, a battery electrode manufacturing company owned by NEC Corporation. Envision AESC and Nissan hold about 80 per cent and 20 per cent of the shares of the newly established Japanese holding company, Envision AESC Group, respectively. Loh Chin Hua, CEO of Keppel Corp, said the investment is part of its strategy to expand the Keppel group's energy solutions with cleaner fuel sources and renewables. It will also be a platform that will deepen its insights into the fast-growing electric vehicle market. Keppel Corp shares ended 1.5 per cent higher at S$6.31 on Monday.
SIA Engineering Company (SIAEC): SIAEC on Monday announced the signing of a comprehensive services agreement with Singapore Airlines, which will supersede the previous agreement inked with SIA in April 2015. The new agreement, commencing April 1, 2019, is for a term of two years, with an option to renew for a further period of two years. SIAEC's support of the SIA fleet covers a broad spectrum of maintenance, repair and overhaul and fleet management support services. The agreement, if renewed after the first two years, is expected to yield a labour revenue of S$1.3 billion to S$1.4 billion over the four-year term. SIA shares closed at S$9.72 on Monday, up six Singapore cents or 0.6 per cent, while SIA Engineering shares closed at S$2.48, up two Singapore cents, or 0.8 per cent.
IHH Healthcare: IHH Healthcare on Monday said that the company's external auditors, KPMG, have said that they cannot determine if there are any regulatory non-compliances and additional adjustments or disclosures which may be needed for the audit report, as a result of further findings from ongoing investigations at Fortis Healthcare. IHH Healthcare acquired Fortis Healthcare and its subsidiaries last November. Prior to the acquisition, an investigation report by an independent external legal firm was submitted to the former Fortis board, relating to systematic lapse and override of internal controls. Findings showed the placement of inter-corporate deposits and existence of possible related parties connected with former controlling shareholders of Fortis. KPMG said these may require "appropriate reassessment" by Fortis Group on the claims from, or transactions with, such parties. The counter last traded at S$1.89 apiece on Monday.
Olam International: Olam International and its wholly owned subsidiary Olam Treasury have secured a three-year digital-linked revolving credit facility of US$350 million. The food and agri-business company said this is the world's first "digital loan" – where the pricing of the facility is linked to Olam's "digital maturity score", thereby supporting Olam in its ongoing efforts towards digital transformation. The digital maturity score is determined by the Boston Consulting Group using its proprietary "Digital Acceleration Index" methodology which assesses Olam across four criteria, namely: business strategy driven by digital, digitising the core, new digital growth and enablers. The counter closed flat at S$1.98 apiece on Monday.
Green Build: Green Build reversed its FY2017 loss of 7.2 million yuan (S$1.5 million) to report a 12.2 million yuan profit for its latest FY2018 financial results. Consequently, the construction firm's earnings per share was 4.95 fen, compared to a loss per share of 2.98 fen for fiscal 2017. Revenue dropped 70.1 per cent from 322.7 million yuan to 96.5 million yuan, mainly due to the substantial completion of Phase 1 of the underground utility tunnel project in FY2017. Its shares last traded flat at five Singapore cents on March 28.