UOBKayHian Regional Morning Notes Thursday, January 28, 2010 Please see important notice on last page Page 1 of 21 CHINA Sector Property Page 2 We expect the sector to drift lower. But for investors seeking entry, we identify six criteria to spot the outperformers in a subdued market. Update China Gas (BUY/HK$3.95/Target: HK$5.20) Page 5 Acquisition of Zhongyu is fair and earnings-accretive. Maintain BUY. HONG KONG Results Hang Lung Properties (HOLD/HK$26.60/Fair: HK$28.60) Page 7 1HFY10: Interim results slightly below expectations. We Upgrade our rating to HOLD in view of the recent correction and the relatively defensive asset base. MALAYSIA Update DiGi.Com (HOLD/RM21.84/Fair: RM21.80) Page 9 4Q09 results preview: Top line uptrend continues for second consecutive quarter, driven by seasonal effect. Expect another special dividend in 2010. Sime Darby (BUY/RM8.73/Target: RM9.90) Page 11 Stronger 2QFY10 earnings likely as the plantation division is expected to outperform, owing to better CPO prices and higher FFB yields. SINGAPORE Results CDL Hospitality Trusts (BUY/S$1.66/Target: S$2.15) Page 13 2009: Key beneficiary of rebound in visitor arrivals. SMRT Corporation (HOLD/S$1.89/Fair: S$2.00) Page 15 3QFY10: Results in line; downgrade to HOLD on valuations and muted growth prospects for FY11. Update Frasers Centrepoint Trust (HOLD/S$1.38/Fair: S$1.43) Page 17 Completes private placement exercise. THAILAND Results Siam Cement (BUY/Bt215.00/Target: Bt259.00) Page 19 2009: Net profit up a significant 45% yoy but down 24% qoq. Key drivers are the recovery in chemical business and better cost control. KEY STORY China Property Page 2 We expect the sector to drift lower. But for investors seeking entry, we identify six criteria to spot the outperformers in a subdued market. China Gas (BUY/HK$3.95/Target: HK$5.20) Page 5 Acquisition of Zhongyu is fair and earnings-accretive. Maintain BUY. Prev Close 1D % 1W % 1M % YTD % Key Indices DJIA 10236.2 0.4 (3.5) (2.7) (1.8) S&P 500 1097.5 0.5 (3.6) (2.6) (1.6) FTSE 100 5217.5 (1.1) (3.8) (3.4) (3.6) AS30 4670.0 (1.5) (4.5) (2.8) (4.4) CSI 300 3198.6 (1.4) (5.8) (8.0) (10.5) FSSTI 2706.3 (1.2) (6.5) (5.2) (6.6) HSI 20033.1 (0.4) (5.9) (6.7) (8.4) JCI 2564.6 (0.5) (3.9) 2.2 1.2 KLCI 1265.8 (1.3) (3.1) (0.5) (0.6) KOSPI 1625.5 (0.7) (5.2) (3.6) (3.4) Nikkei 225 10252.1 (0.7) (4.5) (3.6) (2.8) SET 690.5 (1.6) (5.6) (5.9)