BUKIT SEMBAWANG ESTATES LTD
SGX: B61
Bukit Sembawang - Most Exposed To Singapore’s Residential Market
Downgrade to HOLD with lower Target Price of SGD5.10
- While Bukit Sembawang continues to trade at a steep discount of about 50% to its RNAV, we expect the recent policy tightening to weigh on the share price performance.
- We downgrade the stock to HOLD from BUY with a lower Target Price of SGD5.10, based on a 50% discount to its revised RNAV of SGD10.20.
ASP cuts to impact pure residential player
- With 5-10% increases in the ABSD for property investors, we expect developers to lower their ASPs to stimulate demand. io. As a pure residential exposure, Bukit Sembawang is highly exposed to this sector headwind.
- We expect smaller impact to demand for its landed homes as it caters mainly to local owner occupiers and are less exposed to investment demand.
- We cut ASPs by about 3-6% across all projects and mark down its legacy land value accordingly. We cut EPS by up to 14%.
Sector Report:
Other Property Developer Stocks:
Ho Bee Land (HOBEE) - Diversification Pays Off
UOL Group Ltd - Oversold
City Developments - Policy Overhang
Oxley Holdings - Highly Exposed To Residential Headwinds
CapitaLand - Small Exposure To SG Residential
GuocoLand - Limited Upside
Derrick Heng CFA
Maybank Kim Eng
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https://www.maybank-ke.com.sg/
2018-07-06
SGX Stock
Analyst Report
5.10
Down
8.550
