CDL Hospitality Trusts - OCBC Investment 2020-11-20: Some Light At The End Of The Tunnel

CDL HOSPITALITY TRUSTS (SGX:J85) | SGinvestors.io CDL HOSPITALITY TRUSTS (SGX:J85)

CDL Hospitality Trusts - Some Light At The End Of The Tunnel

  • Sequential improvement.
  • Improved outlook on rapid vaccine development.
  • Higher Fair Value estimate of S$1.39.



Soft 3Q20 but CDL Hospitality Trusts's performance improved q-o-q

  • As a recap, CDL Hospitality Trusts (SGX:J85)’s 3Q20 results remained soft, but performance improved on a q-o-q basis on the back of easing travel restrictions, reopening of temporarily closed hotels, support from government for isolation business and bookings from foreign workers affected by border closures.
  • In general, CDL Hospitality Trusts’s Singapore hotels performed better than its overseas hotels. All of CDL Hospitality Trusts’s hotels with the exception of Raffles Maldives Meradhoo which were closed in 1H have reopened in 3Q.


Rapid vaccine development drives the recovery

  • CDL Hospitality Trusts' share price performance has been boosted by rapid vaccine progress from companies such as Pfizer and BioNTech’s resounding success in its final trial results, Moderna’s 94.5% effective vaccine and AstraZeneca and Oxford University’s potential COVID-19 vaccine etc.
  • It was also reported by US Health and Human Services Secretary that COVID-19 vaccines from Pfizer and Moderna could be ready for US authorisation and distribution within weeks. This could set the stage for vaccine inoculation to begin as early as Dec 2020 and could further grow the confidence and drive the recovery of CDL Hospitality Trusts' share price, in our view.


Adjusting DPU forecasts for FY20-24F up by 3-5%






OCBC Research Team OCBC Investment Research | https://www.iocbc.com/ 2020-11-20
SGX Stock Analyst Report BUY UPGRADE HOLD 1.39 UP 0.980



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