OUE: Macquarie initiate coverage with O/p Call and $3.70 TP, based on a 20% discount to RNAV of $4.62. House like OUE’s core exposure to the office (52%) and hospitality (25%) sectors, and think grp should continue to benefit from rental and RevPAR growth. OUE has only 10% of assets in Singapore residential, which shelters it from concerns about more policy measures in the sector.
Believe OUE’s current share price offers investors a good opportunity for accumulation, as it is trading at a 36.8% discount to RNAV vs the sector’s 31.2%. Think the discount should narrow as office take-up rises and acquisitions are announced.
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