• Jumbo Group (Initiating Coverage) - Invading China with Chilli Crabs
• Cache Logistics Trust - Summoned by Schenker
• China Everbright Water - Resignation of CFO
• ISOTeam -Wins 11 new public and private sector contracts worth $26.3m
• Singapore shipyards bag S$4.9b in new orders despite dive in demand
• Mid-month MSCI review - Speculation of A-shares inclusion underpinned EM markets

Stocks to Watch 
Jumbo Group (JUMBO SP): BUY (Initiating Coverage)
Last Traded Price: S$0.535, Price Target : S$0.68 (27% upside)
Invading China with Chilli Crabs

• Growth underpinned by new outlets, M&A and higher productivity from existing operations
• Milking its success in Shanghai, the most cosmopolitan Chinese city
• Project FY15-18F earnings growth CAGR of 27%, led by new stores and growth in China business
• Initiate with BUY, TP S$0.68 based on 23x FY17F PE 0.9x PEG

Cache Logistics Trust (CACHE SP): BUY
Last Traded Price: S$0.865; Price Target: S$0.93 (Upside 7.8%) (Prev S$0.93)
Summoned by Schenker 

• Schenker seeks to extend the Anchor Lease Agreement (ALA) at 51 Alps Avenue which will expire on 30 August 2016, but C&P (master lease) argues that they have no legal right to do so
• Cache contends that ALA is a commercial agreement signed between C&P and Schenker, and thus will not be binding on the REIT
• Worst-case scenario; DPU to drop 7%, which is close to our forecasts
• Maintain BUY, TP S$0.93

News

China Everbright Water - Resignation of CFO  
China Everbright Water (CEW) announced the resignation of its CFO, Mr Chang Song. His departure is due to personal reasons. We expect the departure of CFO will have no impact on the daily operation of CEW. This is the resignation of the second CFO within the past 12 months. While such situation is unusual, we believe there is no financial issues within the company. In fact, Mr Chang held various positions in different subsidiaries of China Everbright International since 2006 although his position as CFO of CEW is rather short. We expect some short term selling pressure. However, any share price weakness offers good buying opportunities.

ISOTeam - Wins 11 new public and private sector contracts worth $26.3m  
ISOTeam has secured 11 new private and public sector contracts worth $26.3m. Tapping on its strong track record in public sector, it secured contracts worth $22.6m. The Group also won $3.7m worth of landscaping, specialized coating & painting and specialized A&A contracts in the private sector, as synergies from its new business units gained further traction.

Singapore shipyards bag S$4.9b in new orders despite dive in demand 
Singapore shipyards secured S$4.9 bn in new orders during 2015, despite the global economic downturn and uncertain market environment. Association of Singapore Marine Industries (ASMI) president Chow Yew Yuen cited the data point in his report on the Singapore marine industry's performance in 2015. New orders dived 49% from S$9.7 bn booked in 2014. This came on the heels of a cyclical downturn brought on by a collapse in oil prices and slow economic growth in emerging markets. As at the end of 2015, the industry has a total order book of some S$19 bn, with deliveries stretching to 2020. This represents a decline of 20.6% from S$23.9 bn as at the end of 2014.

Mid-month MSCI review - Speculation of A-shares inclusion underpinned EM markets
US stocks ended the session lower with the prospect of a FED rate hike either in June or July occupying investors' minds. Attention turns to the release of May employment data this Friday. Consensus expects non-farm payrolls to stay at 160k while the unemployment rate improves slightly to 4.9% (previous 5%). Meanwhile, EM markets rose, led by A-shares yesterday amid speculation MSCI Inc. will include RMB-denominated shares in its global benchmarks. The outcome of the review should be available by mid-June.

Source: DBS