Monday, 17 February 2014

DBS Group Holdings

UOBKayhian on 17 Feb 2014

FY14F PE (x): 10.9
FY15F PE (x): 9.3

DBS reported core net profit excluding exceptional items of S$802m (+5.5% yoy, -7% qoq) for 4Q13, in line with our forecast of S$830m. It also recognised one-off gain of S$221m from a partial divestment of its stake in Bank of Philippine Islands. Maintain BUY. Our target price of S$21.90 is based on 1.51x P/B, derived from the Gordon Growth Model (ROE: 11.0%, required return: 7.8% and constant growth: 1.5%).

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