GLP

GLP: China plans to cut toll charges & taxes for logistics companies to help develop the industry. The govt will also encourage logistics companies to consolidate & increase its investment to the industry. As the largest provider of modern logistics facilities with 4m sqm of completed GFA in China, GLP is well-positioned to capitalise on any tax incentives benefitting the Chinese logistics sector, which is still in the early development stage.

The company has 2.4m sqm of buildable GFA with a further 5.7m sqm of land reserve & is already developing 1.22m sqm of GFA, which should be completed this year. Since listing, it has made 2 acqns – a 19.9% stake in Shenzhen Chiwan Petroleum Supply Base & a 53.1% stake in Airport City Dev, the sole provider of air cargo logistics at Beijing Int’l Airport. It has also recently raised Rmb3b MTN notes to fund its expansion plans in China.

The stock trades at 1.18x P/B, which is undemanding given its growth potential & market leadership in China.