Yoma

Yoma: the stock price has been on a tear, +20.5% over the past two days. CEO Andrew Rickards in an interview with Bloomberg, said Yoma’s new real estate projects will benefit from increased interest in the country after U.S. President Barack Obama’s visit this week. Obama hailed Myanmar’s shift to democracy and urged more steps to increase freedom after a Nov 19 meeting with opposition leader Aung San Suu Kyi during the first visit to the country by a U.S. president. Rickards believes “this will encourage some people sitting on the fence, particularly the Europeans and Americans, to invest, and will encourage them to think that now is the time to start engaging with this country”. Yoma, which gets almost all of its sales from Myanmar, said earlier this week it plans to spend US$81.3m on a controlling stake in a land project in Yangon, the commercial center and former capital. The proposed US$350 m, 2 m sf devt will consist of residential, retail, hotel and commercial space on about 10 acres of land in the country’s business center. Yoma expects to generate an internal rate of return of as much as 20% on its latest Yangon project. This gels with Cushman & Wakefield’s estimate of 20-25% for internal rates of return for emerging-market devt deals. Construction will start next year and will take 4-5 years to complete. Yoma says it is talking to a number of upmarket hotel operators. “Some are coming to the country for the first time, some maybe coming back after a 20-, 25-year absence.” Notes, the country was once rich up until the ’60s and “some people that remember the old grandeur might be looking to come back.”