Ho Bee Land

Ho Bee Land: 4Q13 net profit spiked up 657% y/y to $506m, although revenue slumped 75% to $56.2m. This brought FY13 net profit to $591.8m (+216.3%) and revenue to $139.3m (-69.8%). For 4Q13, lower revenue was attributed to lower recognition of development properties, offset partially by increased rental from the completion of The Metropolis. That said, bottomline was significantly buoyed by fair value changes of investment properties of $493m, primarily from The Metropolis. Maybank-KE highlights that as Ho Bee’s Singapore landbank is concentrated in Sentosa Cove, residential contribution in the near future would not be much given the softening market. Earnings from China and Australia investments will also not feature in the near term, considering that the projects are in their early stages of construction. Ho Bee’s recurrent income base has strengthened with the completion of The Metropolis, which is ~90% committed. Trading at 0.6x P/B, valuation is attractive. Management proposed first and final and special dividend of 5¢ and 3¢ respectively. The 8¢ payout translates to a 3.7% yield (FY2012: 5¢) Maybank KE maintains Buy with TP of $2.55