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Exchange: SGX
Stock: Sp Land(S30)
Signal: Bullish MACD Crossover
Last Done: $8.78
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Singapore Land Limited |
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Slow and Steady, But Lacks Catalysts |
Results unexciting and in line with expectations. SingLand reported a 2Q13 core PATMI of SGD48.3m (-3% QoQ +14% YoY), after excluding net revaluation gains of SGD98.9m. 1H13 core PATMI of SGD97.9m was in line with expectations, making up 48% of our full-year estimates. We expect core operations to remain relatively flat in 2H13, with few positive catalysts in sight. Maintain HOLD.
Stronger uplift in recurrent income expected from FY15. On a QoQ basis, SingLand reported relatively flat growth in rental and hotel income. We see little upside from office rental reversion and management is cautious about the outlook for the hotel industry on the back of slower visitor growth, new supply pressure and the ongoing labour crunch. The bright spark is likely to come from its retail exposure, but the extension wing at Marina Square is expected to be completed only in 4Q14.
Residential sales have been weak. Sales at SingLand’s 109-unit Mon Jervois have been weak, with 10 units sold as of June (out of 22 units launched) at an ASP of ~SGD2,100 psf. Nonethless, we expect SingLand to launch another two projects in this year, namely the 445-unit JV with UOL at Bright Hill Drive called Thomson Three (est. ASP SGD1,500 psf) and its own development at Farrer Drive to be known as Pollen & Bleu (est. ASP of SGD1,800 psf).
Getting closer to privatisation? SingLand’s parent company, UIC, continued to inch-up its stake up until 12 July, and UIC now has an 80.3% stake in the company. Including Silchester’s 8.2% holdings, SingLand’s free float now stands at 11.5%, merely 1.5% away from the required 10% minimum free float to remain listed. We expect UIC to continue to chip away at the free float should the share price remain at current levels.
Maintain HOLD. We tweak our TP to SGD9.75, pegged to a 25% discount to RNAV on the back of higher valuations for Marina Square, but due to the lack of near-term catalysts for the stock, we maintain our HOLD recommendation. Singapore Land – Summary Earnings Table
FYE Dec (SGD m)
2011A
2012A
2013F
2014F
2014F
Revenue
615.3
580.6
447.2
490.2
689.6
EBITDA
264.9
248.2
166.5
195.2
270.9
Recurring Net Profit
214.8
218.6
200.1
224.1
270.4
Recurring Basic EPS (SG cts)
52.1
53.0
48.5
54.3
65.6
EPS growth (%)
4.7
1.8
-8.5
12.0
20.7
DPS (SG cts)
20.0
20.0
20.0
20.0
20.0
PER (x)
11.3
9.3
12.6
16.8
13.9
EV/EBITDA (x)
15.0
16.5
25.3
21.0
14.7
Div Yield (%)
2.2
2.2
2.2
2.2
2.2
P/BV(x)
0.8
0.7
0.7
0.7
0.7
Net Gearing (%)
4.2
6.6
8.2
6.1
3.9
ROE (%)
6.9
7.9
5.6
4.1
4.8
ROA (%)
5.5
6.3
4.3
3.2
3.8
Consensus Net Profit (SGD m)
225.5
245.5
253.0
back up to 9.1..
investors have taken their 20c divy
hopefully mgtment can do something to unlock shareholder value..
either privatization or spin off a reit..
gd luck dyodd
Hi Ozone2002 - do you forsee any privatization plan for Sp Land in thecoming weeks ? now that SPH has confirmed it's own?
Divy paid out 20c.. still going up 9+
hope there's privatization or someway of unlocking value of SP Land..
gd luck dyodd
superb run up..$9.3
chart looks a bit toppish..
take some profit..
gd luck dyodd
From DBS.. they are aggressively pushing this stock.. now 9.07!!
Following our re-assessment of the value of Singapore Land
which led to a consequent upgrade of RNAV and target prices,
our valuation for UIC and UOL have also been raised by up to
10% on upstreaming the positive knock-on impact. UOL owns
79.96% of Singland while UOL in turn holds 43.4% of UIC.
Whilst UOB should also enjoy positive accretion from its
holdings of these companies, directly and indirectly, the impact
is a relatively small 3%, given the significant size of its core
banking business. We have a BUY call on SingLand (TP: S$
9.53) and UOL (TP: S$7.77 (Prev S$ 7.03)) upgraded UIC to
HOLD with a TP of $3.00 (Prev S$ 2.21) and maintain HOLD on
UOB (TP: S$20.10).
We believe there are more potential catalysts in the works. The
key catalyst, in our view, to a realization of the underlying
value of this chain of companies, is if Singland is privatized,
which in turn could mean a removal of the ascribed discount
to Singland’s TP and valuing its assets as directly held
properties at UIC level. In this instance, on a best scenario
basis, this translates to a 35% upside to UIC’s valuation, which
in turn would mean a further 9% boost to UOL’s TP.
Singland’s TP, premised on an average 30% discount to asset
backing of $13.61, implies a further 9% upside from here.
However, we believe this would likely be more a medium to
long term development.
DBS
Lots of hidden value
•
Significant hidden value•
Large potential value accretion from MCH•
Upgrade to BUY with TP raised to S$9.53Deep underlying value.
shares by its major shareholder, UIC, in recent months, renewed
investor interest and realization of the deep embedded value in
the company has prompted us to take a deep-dive look at
Singland. We believe Singland has significant hidden value
through its 53.06% stake in unlisted Marina Centre Holdings
(MCH), in addition to its large portfolio of 2.1msf of directlyowned
centrally located and suburban office space. The group
has also increased its landbank and now has 788,364sf
residential GFA in Singapore, to be developed over the next few
years. We anticipate these growth engines to continue to be
ramped up in the coming years.
Increasing accumulation of SinglandMCH carried at below replacement cost.
look at the value of MCH reveals that there is significant hidden
value in its hotels and investment properties at MCH that are not
reflected in current book value. The hotels are carried at cost,
which we believe is below current replacement cost while
valuation of the investment properties is conservative. If marked
to market, this could add 97Scts to our RNAV for Singland to
S$13.61. As one of the largest hotel room owners in the Marina
enclave, with 1,880 hotel rooms or c4+% of total stock, there is
a scarcity value premium that can be attached.
Our see-throughRedevelopment provides further room for value accretion.
In addition, there is more value creation through the
redevelopment of the Marina Bayfront office block into an
extension of the Marina Square retail space, to improve the
visibility and frontage of the shopping complex. In addition, the
current 20% valuation disparity between office and retail space
would also mean potential for value optimisation through space
conversion. We believe the makeover is timely and would enable
the group to benefit from the rejuvenation of the Marina area, in
tune with the AEI at Suntec City and completion of South Beach
by 2015. Conservatively, assuming similar valuations for the
additional retail space when completed, we reckon the group
could recognise a further 3Scts to RNAV.
Upgrade to BUY.
adjusted TP of S$9.53, pegged at a 30% discount to RNAV of
S$13.61. Share price is currently trading at a 32% discount to
book NAV and 38% below our RNAV estimate. We believe the
stock continues to offer good value backed by a portfolio of
quality assets. Furthermore, with a lowly geared balance sheet
and strong recurrent cashflow from leasing activities, Singland is
in a good position to maintain a reasonable dividend yield,
currently at 2.4%. The risk to our view for a potential closing of
price gap to RNAV is if the major shareholder does not raise its
stake further or if there is no recognition of the underlying value
of MCH given its unlisted status.
Privatisation candidate.. gd luck dyodd
TP 8.32 from Kim Eng
Singapore Land Limited
Steady As She Goes
Slight growth in core PATMI.
in its FY12 headline PATMI to SGD407.1m, but excluding revaluation
gains, core PATMI showed a mere 2% YoY
largely in line with expectations. FY13F earnings are likely to take a dip
on the back of expected weaker rental income and development profit
recognition, but we are not overly concerned. Maintain BUY.
SingLand reported a 23% YoY increaseDevelopment profits picked up the slac
closure of the Pan Pacific Singapore hotel for
gross profit from the hotel dropped from SGD41.2m in FY11 to a
marginal loss of SGD0.3m in FY12. The decline in hotel earnings was
largely buffered by an increase in development profits, mainly from The
Excellency in Chengdu, China.
Portfolio revalued upwards by 3.9%
properties enjoyed a 3.9% YoY revaluation gain, despite
remaining flat YoY. This is presumably due to lower cap rates used by
the valuers. However, we believe that Grade B office rents are likely to
come under greater pressure in FY13, given the upcoming new supply.
Landbank sufficient for now.
projects in the pipeline, we reckon that SingLand will not be actively
landbanking. The first project to be launched is likely to be the 109
Mon Jervois at Jervois Road, right at the edge of Chatsworth Park
Goodclass Bungalow Area. We estimate the proje
SGD1,750 psf.
With four unlaunched residentialCheap valuation privatization still possible
an undemanding 0.6x P/B and P/RNAV, suggesting that it remains a
fairly attractive privatization candidate. We have raised our RNAV
marginally to SGD8.32, and maintain our BU
Singapore Land – Summary Earnings Table
FYE Dec (SGD m) 2011A 2012A
Revenue 615.3 580.6
EBITDA 264.9 248.2
Recurring Net Profit 214.8 218.6
Recurring Basic EPS (SG cts) 52.1 53.0
EPS growth (%) 4.7 1.8
DPS (SG cts) 20.0 20.0
PER (x) 9.2 7.5
EV/EBITDA (x) 12.3 13.7
Div Yield (%) 2.7 2.7
P/BV(x) 0.6 0.6
Net Gearing (%) 4.2 6.6
ROE (%) 6.9 7.9
ROA (%) 5.5 6.3
Consensus Net Profit (SGD m)
Source: MaybankKE
TIONS
13 February 2013
Singapore
Co. Reg No: 198700034E
MICA (P) : 099/03/2012
increase to SGD218.6m,
slack.
major refurbishment,
n
rental income
. ojects 109-unit
project to have an ASP of
Due to the five-month3.9%. SingLand’s investmentpossible.
2, BUY recommendation.
7.64.. looking good..
gd luck dyodd
privatization play..
as per Kim Eng's note.. TP $8.2 vs RNAV of $11.8
gd luck dyodd
ozone2002 ( Date: 21-Dec-2012 10:12) Posted:
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recent focus on potential privatization after SCglobal's offer
Singapore Land Limited
Navigating the Slowdown
Turning more to development.
sector remains muted, and the hotel sector also appears to have
peaked, SingLand has turned to residential development by acquiring
four sites in 2012. We see this as a proactive move by the management
to maintain returns for shareholders. With its
now see a higher probability of a privatisation
As the outlook for the Singapore officeOn a shopping spree.
Government Land Sales (GLS) programme, acquiring four sites for
residential development (Bright Hill site is a 50
sites have a combined attributable GFA of
estimated GDV of SGD1.3b. At a blended pre
margins are decent.
SingLand was an active participant in the 2012Ongoing projects almost sold-out.
Trizon and Archipelago (50% stake) are now substantially sold at 92%
and 99% respectively. We expect the progressive recognition of income
from Archipelago to mitigate possible mild
rental income, with more development profits from FY14 onwards
the four newly acquired sites start to contribute
After sluggish starts, both TheGetting closer to privatisation?
SingLand, while Silchester holds another 8.2%.
term institutional holder of the stock (more than 10 years), leaving
SingLand’s free float close to the 10%-mark
listing status. With SingLand still trading at a 40% discount to our
RNAV, UIC may finally pull the trigger and launch a privatisation bid
funded by the low current borrowing costs
SGD8.80/sh corresponding to SingLand’s 10
it will cost UIC SGD733m to buy the shares it does not already own.
UIC holdUpgrade to BUY.
commercial landlord, we like that management is actively navigating the
headwinds. We raise our target price to SGD8.20,
a narrower 30% discount to RNAV (from 40%). Upgrade to BUY.
While SingLand remains predominantly aSingapore Land – Summary Earnings Table
FYE Dec (SGD m) 2010A 2011A
Revenue 527.2 615.3
EBITDA 243.6 264.9
Recurring Net Profit 205.1 214.8
Recurring Basic EPS (SG cts) 49.7 52.1
EPS growth (%) 0.9 4.7
DPS (SG cts) 20.0 20.0
PER (x) 4.4 8.8
EV/EBITDA (x) 12.8 11.8
Div Yield (%) 2.8 2.8
P/BV(x) 0.7 0.6
Net Gearing (%) 4.9 4.2
ROE (%) 16.0 6.9
ROA (%) 11.7 5.5
Consensus Net Profit (SGD m)
Source: Maybank KE
SP land 7.09
UIC active again..
gd luck dyodd
Pocahontas ( Date: 24-Sep-2012 17:12) Posted:
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Wow SpLand shoot up by 11 cents in this bearish market !
ozone2002 ( Date: 18-Sep-2012 14:12) Posted:
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