Interdean reviews the opinion of brokers, Morgan Stanley, and their preference of Singapore.
It has been reported that Morgan Stanley’s ASEAN equity strategy report has shown that the company prefers Singapore over Indonesia.
Morgan Stanley is an American multinational financial services corporation. It operates in 42 countries has more than 1300 offices and 60,000 employees. Its main areas of business are Global Wealth Management, Institutional Securities and Investment Management.
Their report has shown that cracks in margins have emerged in Indonesia. On the other hand improvement in Singapore’s profitability was observed in the first quarter. The consensus among experts is that profitability will deteriorate in Indonesia and stabilise in Singapore in the second quarter.
Singapore is set to see improvements in profitability in 2015 and 2016. Morgan Stanley is slightly more optimistic. They expect a Singapore margin of 7.5 per cent in 2014, compared to the consensus of 6.9 per cent.
Morgan Stanley’s list of stocks to buy on its list includes SingTel, Singapore Airlines and Indofood Agri Resources.
It is expected that operating margins will improve on yield and load factor improvements.
A plan of action has been drawn up including effective capacity management, introduction of premium economy class and fitting a new cabin design on 19 new aircraft.
A spokesperson from Interdean, states: ‘The fact that Singapore is set to see an increase in profitability in the next two years is fantastic news for the country. Singaporean businesses and companies should benefit greatly from this current stock forecast. Hopefully some exciting investments will be made which will benefit Singapore and its citizens.’
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Morgan Stanley brokers express preference to Singapore over Indonesia