Global Logistic Properties - DBS Research 2017-02-10: ’Bids’ on the table

Global Logistic Properties - DBS Vickers 2017-02-10: ’Bids’ on the table GLOBAL LOGISTIC PROP LIMITED MC0.SI

Global Logistic Properties - ’Bids’ on the table

  • 9M17 core net profit +25% y-o-y, above consensus.
  • Met 91% of FY17F development completion target.
  • On-track development starts at 71% of FY17F target.
  • Maintain BUY; TP of S$3.00 (1.2x P/NAV).

Maintain BUY on higher TP of S$3.00. 

  • We maintain our BUY call for GLP with a revised target price of S$3.00 (vs S$2.47 previously). Our new TP is pegged to a narrower 15% discount to RNAV. 
  • Given ongoing corporate activity involving possible various bidders for the company, we believe that near term share price will continue to see support.

Strong 9M17 core net profit growth; development completions ahead of target. 

  • Core 9M17 net profit (excluding revaluation gains and one-off items) grew 25% y-o-y to S$215m, above the street’s FY17 estimate. 3Q17 fair valuation gains of +34% were mainly from China, following from an increase in development completions and cap rate compressions. 
  • Development completions were ahead of the FY17F target (91%) while development starts were 71% of the FY17F target.

Pegging to historical take-over premiums. 

  • In view of recent discussions on a potential take-over price for GLP, assuming a take-over happens, we peg to CMA’s take-over at a P/BV multiple of 1.23x – this means a fair value price could be closer to S$3/share. 
  • At our target price, this implies a c.39% 6-month VWAP to-date for the company.


  • We maintain our BUY call with a higher target price to S$3.00 for a narrower 15% discount to RNAV. This implies 1.2x P/NAV in view of a potential corporate development on the horizon.

Key Risks to Our View

  • Key risk to our view will bids that result in no takeover of the company which means that price could drop back to S$2.50- 2.60, close to 1.0x P/NAV.

Rachel Tan DBS Vickers | Derek Tan DBS Vickers | http://www.dbsvickers.com/ 2017-02-10
DBS Vickers SGX Stock Analyst Report BUY Maintain BUY 3.00 Up 2.470