Boustead

Boustead: CIMB initiated coverage on Boustead with an ADD rating and $1.94 TP, citing a bright overall outlook ahead: i) Real estate division plans to launch a REIT to unlock hidden value and recycle capital; ii) Energy-related engineering order book backlog is near record high; iii) Water division is becoming less of a drag; iv) Geo-spatial division will resume steady expansion. Boustead’s strong cash on hand ($248m) and the recently established $500m debt issuance programme should accelerate the group's assets acquisition to increase portfolio GFA to 0.3m sqm from the current 0.163m sqm. CIMB estimates the REIT to be likely launched within the next 2-3 yrs.