Thursday, March 21, 2013

SPH

SPH: Maybank-KE reiterates Buy, lifts TP to $4.95 from $4.50, factoring in potential REITs benefits. Says this is just the first step of what is likely to turn into a multi-year value unlocking process. Believes the proposed REIT can fetch a potential distribution yield of 5.6%, attractive relative to the avg S-REIT yield of 5.3%. Estimates a special div from the spinoff, at $1b or $0.63 per SPH sh. Notes mkt has not fully appreciated SPH’s property upside over the longer term; its options include, i) roping in asset owner partners to expand the asset pipeline, ii) directly acquiring suitable assets in Singapore, and /or iii) expanding outside Singapore to other countries.

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