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DeutscheBank Markets Research
We met Keppel Land's management in Shanghai and visited 8 Park Ave, Seasons Residences, Life Hub @ Jinqiao and a site at Sheshan. Since Keppel Land China was formed in 2010, China has grown from 20% of assets (or S$1.7bn) to 44% (or S$5.8bn). The company has made S$2.1bn of acquisitions since then, largely focused on the key markets of Beijing (S$0.2bn), Shanghai(S$0.8bn), Chengdu (S$0.5bn), Wuxi (S$0.45bn) and Tianjin (S$0.05bn). The land bank has grown to 5.6m sqm, or 40,000 units.
Strong residential sales YTD encouraging signs from recent launches
The company has sold 3,600 units (YTD to mid-Nov 2013) vs. 1,650 units in FY12. End-user focused projects such as Springdale (96% of 611 units sold YTD), Stamford City in Jiangyin (73% of 416), and Botanica in Chengdu underpinned volumes. ASPs have firmed y-o-y, with modest sub 5-10% price increases. Achieved selling prices and volumes are consistent with our estimates. At 8 Park Ave, 38% of 260 units were sold by mid-Nov 2013 at an average of RMB71k psm. Recent launches have posted encouraging initial take-up ? 88 units were sold at the latest Springdale phase and 60 units at Seasons Residences were sold at RMB25k psm since early November. The recently acquired Sheshan site will differentiate itself by its location close to anupmarket enclave, and smaller more affordable villas.
Growing commercial in first tier cities
The company acquired a 51% stake in Beijing office development (100,000sm in the Chaoyang district) in 2012, followed by a 34% stake in Life Hub @Jinqiao in 2013. Life Hub is a completed asset which was acquired with Alpha Investment Partners at RMB28.8k psm. The asset is performing well with near full occupancy rates (99.7% for retail, 97.6% for office), delivering a 4.5-5.5% yield on cost and enjoying strong rental uplift after the first renewal cycle. The development of Park Ave Central (110,000sm GFA retail/office project) which is expected to complete in 2017/2018 will further grow the portfolio. The site has a prime location in the Jingan district. Keppel Land is positive on commercial in Shanghai and Beijing and will continue to look to grow its presence.
Maintaining Buy with TP of S$4.27, pegged to 20% discount to NAV of S$5.34
Deutsche Bank?s China team remains positive on the prospects for end-user demand growth and this should benefit Keppel Land?s township projects. In the long term, a growing commercial property portfolio in China should help address concerns on a hollowing out of Keppel Land's Singapore office portfolio. We remain positive on developers with offshore exposure and maintain our Buy recommendation on Keppel Land with valuations looking attractive at a 34% discount to our RNAV.
i brlieve it will rebound on the 354-36 level... waiting it to drop to go in...
There are no other negative news relating to its decline besides the property cooling measures introduced by the govt this year. Technically, counter had been trading in a narrow channel between $3.30-$3.75 since Jun. May see downward pressure in the near-term after crossing below its 20 and 50 MA this week, towards the $3.40 level, supported by both the RSI and Stochastics hooking downwards.
The long term outlook for kepland is bullish. It depends on the economic direction that China takes because Kepland is well positioned in China. If China rebalances it's economy toward consumer spending, then there will be greater depend for office properties, an area where Kepland is strong in.
As for share price is concerned, it current book value id $4. The share price now is below book value which means it is cheap. The share price can easily go to 1.5 times to 2 times book value in a bull market as in the past when it went up to 3 times book value.
So we can expect share price to gp up to $6 in the long run.
Hope this helps
Lee1979 ( Date: 14-Nov-2013 20:53) Posted:
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Hi.im a newbie here. Any mid to long term views for keppel land?
Keppel Land has acquired a 10.37 ha prime residential sit ein the Sino-Singapore Tianjin Eco-City for Rmb241.1m. The deal was signed at the 6th Singapore-Tianjin Economic and Trade Council meeting in Spore this morning. At the conference, a total of 12 new projects were signed between Spore and Tianjin, building upon Singapore?s existing investments in the Chinese city. Relations between both cities are already warm, with bilateral trade having increased 32% to US$2.2b in 9M13. Keppel Land plans to develop ~350 landed homes on the new site, which is located within the Start-Up Area and close to the future city centre in the Tianjin Eco-City. Targeted at the upper-middle income homebuyers, the new landed homes will be launched progressively, starting from 2H14. Keppel Land?s purchase price translates to RMB2.3k psm land area which is a reasonable price though limited impact to RNAV is expected. OCBC continues to like KPLD for its diversified exposure across property segments and geographical markets, and a strong balance sheet with $900.4m in cash and 44% net gearing. Maintain Buy with TP $4.09 (30% discount to RNAV). As background, Keppel Land China?s first eco-homes in the Tianjin Eco-City, the 1,672-unit Seasons Park, was launched in 2010. As at end-Sep 2013, ~ 77% of the 1,105 launched units have been sold. Phase 2, Seasons Garden, comprises about 1,190 homes and was launched in Aug 2013. The commercial development, Seasons City, will comprise three office towers and retail premises with a total gross floor area of 162,000 sm. The first phase will feature one office tower and a retail complex, and is expected to be completed by 2017.
Keppel Land's profit attributable to shareholders of the company for the third quarter ended Sept 30 surged 69.7 per cent over the previous year to S$126.4 million, on stronger contributions from its property trading, property investments and fund management segments.
This works out to an earnings per share of 8.2 Singapore cents, versus the 4.9 Singapore cents for the same period last year. Revenue at Keppel Land grew 151.1 per cent year-on-year in Q3 to S$417.9 million. The company attributed this to stronger contributions from its property trading segment, with more project completions in China and progressive recognition of revenue from its Singapore projects, as well as higher contributions from its property investment and fund management segments.
Even though cost of sales increased 147.8 per cent over the year to $297.6 million, the strong sales helped gross profits grow 159.6 per cent to S$120.3 million in Q3.
The bottom line growth was taken down a notch by the likes of higher administrative and other expenses and lower other income, although a higher investment income and the absence of an " other loss" from the previous year helped.
Downward pressure for Keppel Land is still exist. The next 2 days' candlestick will be very very important and will know if the rebound is happening but I doubt so as the as the stock in the currently in negative zone. Only thing is a big push by the big players the next 2 days can only turn the stock around to uptrend.
One point to note is range of 3.43 to 3.46 .If there is support at this price without breaking down further below 3.43, and there are buying interest tomorrow, then the rebound will happen after that, if the stock cannot support above 3.43, then more downsides will happen before any rebound.
All the best..
marubozu1688 ( Date: 06-Oct-2013 16:17) Posted:
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No point looking at property stks now, at most trade in range. Through these few mths of window dressing. One thing is clear, funds r not tat enthusiastic on property counters as a whole. Believed they have already standby n held their shorts all this while waiting for brokers to dngrade the sector. There are so many headwinds, worries on curbs, interest rates, flooding of supply w slower demand. When thy hammer the sector, thy dnt care wat segments the counters r in, as the simple reason is all developers will b affected. N developers r developers.
Keppel Land is trading within a range now.
http://mystocksinvesting.com/singapore-stocks/keppel-land/keppel-land-consolidate-in-a-rectangle/
marubozu1688 ( Date: 14-Sep-2013 17:53) Posted:
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Keppel Land at the resistance now. Let's see whether is a reversal pattern here.
http://mystocksinvesting.com/singapore-stocks/keppel-land/keppel-land-trading-in-consolidation-either-sideway-or-down-side/
Wonder how is " the glades" doing? by kepland
Wow! Buy call from Deutsche.
Different view here from TA point of view.
http://mystocksinvesting.com/singapore-stocks/keppel-land/keppel-land-confirmed-down-trend/
Octavia ( Date: 19-Aug-2013 10:09) Posted:
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Deutsche maintains Buy with $4.34 TP. House recently met with Keppel Land?s management and discussion focused on management outlook and strategy for its key SG and China markets, as well as thoughts on capital recycling and deployment plans. Management commented that SG residential market has been getting more challenging with cooling measures impacting demand. While prices could soften, there is unlikely to be a sharp correction, with underlying demand supported by owner occupiers. Management stated that it will take a wait-and-see approach on future land tenders and continue to focus on well located sites. Keppel Land remains positive on underlying fundamentals in China, and on the near term outlook with a moderation in new tightening measures. Sales momentum has been steady over the past months, with Botanica, Springdale and 8 Park Avenue continuing to attract healthy demand. The co noted that competition remains strong and will focus on its core markets in order to gain scale and maintain relationships. MBFC Tower 3 is now 90% committed. While the asset is sufficiently stabilised to be divested to Keppel REIT, management is also comfortable to wait as the office rental market is likely to improve over the next 2 years. Mgt will also consider reinvestment opportunities and the impact on earnings from the divestment. Co expects office rents to recover at c.10%/yr. Mgt also stated that it will look to increase its exposure in Jakarta, following the planned divestment of its stake in Jakarta Garden City which would result in a S$186m gain if completed this year.
Dead Cat Bounce over for Keppel Land.
http://mystocksinvesting.com/singapore-stocks/keppel-land/keppel-land-dead-cat-bounce-over/
Disposal of Jakarta Garden City, after-tax profit = $186m (i.e. 13c per Kepland share). Close at $3.70 today.
http://infopub.sgx.com/FileOpen/Media.release_Keppel.Land.unlocks.value.in.Jakarta.Garden.City.final.ashx?App=Announcement& FileID=249095
Keppel Land announced a pretty decent set of 2Q12 results which was in-line with estimates. Revenue at $330.5m (+154% y/y, +60% q/q) while net profit at $95.5m (+1% y/y, -1% q/q). The robust top-line was primarily driven by increased revenue from the group’s Property Trading segment which was buoyed by higher revenue recognition from The Lakefront Residences and The Luxurie in Singapore, The Springdale in Shanghai and the new revenue stream from Phases 4 and 5 of 8 Park Avenue in Shanghai which were launched in Jun13. During quarter, sales momentum accelerated in both S’pore and China and as of 1H13, Keppel Land has sold 210 units in S’pore valued at $527m driven by strong demand for Corals, while in China the group has sold 1,940 units valued at RMB2.4b. The group also registered higher contributions from its Property Investment segment on back of higher rental yields from Keppel REIT and Marina Bay Financial Centre (MBFC) Tower 3, together with improved contributions from the Hotels and Resorts and Others segments. These increases were however partly reduced by lower contributions from Reflections at Keppel Bay and the group’s Fund Management segment.
Despite MBFC Tower 3 reaching an ~90% committed occupancy, although management highlight that there is currently no rush to recycle capital by divesting its 1/3 stake to Keppel REIT, given the group’s net gearing is a comfortable 0.4x with a healthy cash position of $1b. as such, we opine that the possible divestment now appears more likely to happen in FY14 rather than FY13. Going forward, Maybank-KE reiterates Keppel Land as one of its top property picks, as the house continues to favour KepLand’s diversified business and undemanding valuations. Positive catalysts include further tie-ups with China Vanke in China and the eventual monetization of MBFC Tower 3. At current price, valuations are undemanding, with the group trading at just 0.9x P/B and 0.6x P/RNAV.
Latest broker ratings as follows: Maybank-KE maintains Buy with $4.80 TP CIMB maintains O/p with $4.00 TP Credit Suisse maintains neutral with $4.10 TP Deutsche maintains Buy with $4.34 TP Nomura maintains Buy with $4.75 TP OCBC maintains Buy with $4.09 TP StandChart upgrade to O/p with $4.06 TP UOB Kay Hian maintains Buy with $5.11 TP
Keppel Land starts down trend.
http://mystocksinvesting.com/singapore-stocks/keppel-land/keppel-land-start-of-a-down-trend/
Keppel Land China wins prime landed residential site in Shanghai for $266 mil
Keppel Land China said it has acquired a prime 17.5-ha residential site in Shanghai’s Sheshan area for RMB1.33 billion ($266 million) for the development of 200 landed homes.
The newly secured site in Sheshan Town will comprise about 200 landed homes ranging from 250 to 350 sm. When completed, residents can look forward to amenities including a clubhouse with full facilities as well as an auxiliary retail component within the development. The first phase of homes is expected to be launched in the second half of 2014.
The site is about 20 km from the Shanghai Hongqiao International Airport and 32 km from the city centre. It also enjoys convenient access to the A9 expressway and is just three km from Metro Line 9 Sheshan Station. The site is located about 11 km southwest of Villa Riviera, Keppel Land China’s first villa project in Shanghai.
Keppel Land China’s projects in Shanghai include the Park Avenue precinct in the Jingan District, which comprises One Park Avenue, which is fully sold, 8 Park Avenue and Park Avenue Central, as well as The Springdale in Xinchang Town, Pudong District, Seasons Residence in Nanxiang Town, Jiading District, and Villa Riviera, a villa development in Qingpu District. Keppel Land China also owns a stake in Life Hub @ Jinqiao, a retail development in Pudong District. The Company also developed Ocean Towers, an office development in the prime commercial Huang Pu District.
..Last Done: $3.53... recent low: $3.36...
KL near term outlook is weak, after the breakdown below the 200 day MA. $3.60 is a key support level, which if broken, could lead to extended downmoves to the next support around $3.40.