Global Premium Hotels

Global Premium Hotels: OCBC initiates Coverage with Buy Call and $0.29 TP. HOuse note that GPH develops, owns and operates Economy-tier and Mid-tier hotels, and is the second largest operator of Economy-tier hotels in Singapore. GPH currently operates 23 hotels in Singapore with a total of 1,738 rooms under the well-known "Fragrance" (Economy-tier - 22 hotels) and the "Parc Sovereign" brands (Mid-tier - 1 hotel). Out of the 23 hotels, 22 are wholly owned by the group, and 19 of them are on freehold land. From 2006 to 2011, GPH grew its portfolio of rooms by an impressive CAGR of 10.9% p.a. from 1,034 rooms to 1,738 rooms. GPH will continue its expansion with the development of a ~60-room Parc Sovereign hotel at the Tyrwhitt Road site which it has recently acquired from its parent, Fragrance Group. The hotel will expand the total room count under GPH's management by 15% and based on third party valuers' and management's estimates, could potentially result in a $42m accretion.