CitySpringTrust: To issue 11 rights for every 20 units at $0.39 per rights unit. Net proceeds of approx $204.8 will be raised and used to refinance or repay Basslink's $190m debt, reduce gearing or be used for general corporate working purposes...
Temasek owned Bartley Invts, co's largest unitholder, has undertaken to subscribe for 85% of all the rights units. Co has a consistent DPU of 1.05c per quarter which is approx 7.78% yield. However co is still loss making and if rights issue is merely to pare down debt, DPU is likely to fall.
Friday, July 1, 2011
Property
Property: CBRE said mthly avg rent for prime Orchard Road space remained at $30.10 psf pm in 2Q, unchg qoq, but contracted marginally by 0.5% over 1H11.
Prime suburban rents dipped by 0.7% qoq to $28.90 psf pm in 2Q, possibly due to competition from imminent supply of 520k sf of space due to come on stream in 2H11...
CBRE estimates that confirmed retail supply totals ~4.3m sf in the next 4yrs and beyond. Of this, only 13.2%, (a size less than the total NLA of Nex mall) will be located in Orchard Road. The bulk, 55.2% of retail supply will be in the suburbs, notably ~1.2m sf coming up within 1km radius around Jurong East MRT station by 2015, boosting private retail stock in the Jurong East area from ~0.9m sf currently to 2.1m sf...
This suggests Orchard Road rents may remain more buffered than suburban rents going forward.
CBRE added the retail leasing mkt remained active underpinned by stable economic growth, low unemployment rate and healthy consumer spending. Notes well managed malls and necessity trades hould continue to flourish, and retailers may take the opportunity to expand their retail network...
Overall, news is slightly positive for Starhill Global Reit, whose main property exposure is in Ngee Ann City in Orchard Road. Street ratings mostly positive with recent TP btwn $0.70- 0.74. Reit offers 6.5% FY11E yield.
Property: URA closed a tender for a residential parcel at Choa Chu Kang/Phoenix Road yday after receiving 5 bids. The land parcel has an area of over 15k sm and a max permissible GFA of 32k sm...
Top bidder is a joint bid by Far East and China Construction Devt at $142.8m. This translates to ~ $411 psf ppr. This is below market estimates in May. Some consultants expected a top bid of $425-500 psf ppr, or even $600-640 psf ppr. The group plans to develop two 24-storey towers with one to four-bedroom apartments along with some townhouses...
Next highest bid is from EL Devt at $122m placing the spread between them at 17%.
CBRE places the breakeven cost at $800-850psf and estimates around 335units to be released, while Colliers and SLP Int’l estimates ASP at $900-1000psf...
Credo Real Estate notes the 2H11 Govt Land Sales program might have caused the softening in demand for less attractive sites as developers become more cautious and selective.
URA will announce the award of tender at a later date.
Prime suburban rents dipped by 0.7% qoq to $28.90 psf pm in 2Q, possibly due to competition from imminent supply of 520k sf of space due to come on stream in 2H11...
CBRE estimates that confirmed retail supply totals ~4.3m sf in the next 4yrs and beyond. Of this, only 13.2%, (a size less than the total NLA of Nex mall) will be located in Orchard Road. The bulk, 55.2% of retail supply will be in the suburbs, notably ~1.2m sf coming up within 1km radius around Jurong East MRT station by 2015, boosting private retail stock in the Jurong East area from ~0.9m sf currently to 2.1m sf...
This suggests Orchard Road rents may remain more buffered than suburban rents going forward.
CBRE added the retail leasing mkt remained active underpinned by stable economic growth, low unemployment rate and healthy consumer spending. Notes well managed malls and necessity trades hould continue to flourish, and retailers may take the opportunity to expand their retail network...
Overall, news is slightly positive for Starhill Global Reit, whose main property exposure is in Ngee Ann City in Orchard Road. Street ratings mostly positive with recent TP btwn $0.70- 0.74. Reit offers 6.5% FY11E yield.
Property: URA closed a tender for a residential parcel at Choa Chu Kang/Phoenix Road yday after receiving 5 bids. The land parcel has an area of over 15k sm and a max permissible GFA of 32k sm...
Top bidder is a joint bid by Far East and China Construction Devt at $142.8m. This translates to ~ $411 psf ppr. This is below market estimates in May. Some consultants expected a top bid of $425-500 psf ppr, or even $600-640 psf ppr. The group plans to develop two 24-storey towers with one to four-bedroom apartments along with some townhouses...
Next highest bid is from EL Devt at $122m placing the spread between them at 17%.
CBRE places the breakeven cost at $800-850psf and estimates around 335units to be released, while Colliers and SLP Int’l estimates ASP at $900-1000psf...
Credo Real Estate notes the 2H11 Govt Land Sales program might have caused the softening in demand for less attractive sites as developers become more cautious and selective.
URA will announce the award of tender at a later date.
IPO news
IPO news: UBS is reportedly working on at least 5 listings in Spore valued btwn US$500m – 1.5b, and expects some to be pushed out in 2H11. Amongst the double-digit no. of deals that the bank is working on are a couple of Reits that include those with links to the tourism industry (ie. hotel Reits). UBS notes air traffic has been pouring through Spore and investors want to continue to play that theme bcs they expect only upside on the front...
Positive beneficiaries include CDLH Trust (investors may relook this hotel Reit) and OUE (mgt open to Reit spin off and sale of Mandarin Orchard)...
ben_oh: UBS is also looking to dual-list a European based company (possibly BW Offshore).
The new listings, if successful, could provide a boost to trading volumes for SGX, and could be a catalyst given the recent lack of trading activity.
Positive beneficiaries include CDLH Trust (investors may relook this hotel Reit) and OUE (mgt open to Reit spin off and sale of Mandarin Orchard)...
ben_oh: UBS is also looking to dual-list a European based company (possibly BW Offshore).
The new listings, if successful, could provide a boost to trading volumes for SGX, and could be a catalyst given the recent lack of trading activity.
SGX
SGX: DBSV maintains Buys buy lowers TP to $9.50 from $10.50. Note that trading vol and values in the securities market have softened. Average daily trading vol and value stands at 1.56b and $1.62b respectively, while derivatives rev are likely to be soft. Although derivatives trading volumes have remained relatively robust, the weak US$(to S$) is expected to cap upside.….
House lowers average daily volume and value assumption by 5% across FYJun11-13. Coupled with soft derivatives and other rev, trim earnings by 15-17% over the same period. Estimate a full year DPS of 27c (90% payout). At current price, grp trades at is trading at 21x FY11 and only 18x FY12 P/E, below its 5-year historical mean and regional peers at 27x FY11 and 23x FY12 P/E.
House lowers average daily volume and value assumption by 5% across FYJun11-13. Coupled with soft derivatives and other rev, trim earnings by 15-17% over the same period. Estimate a full year DPS of 27c (90% payout). At current price, grp trades at is trading at 21x FY11 and only 18x FY12 P/E, below its 5-year historical mean and regional peers at 27x FY11 and 23x FY12 P/E.
SG Banks
SG Banks: Sector could see positive sentiments, after Bank lending in SG reached another high in May at $363.27b, +3.5% mom and a new peak since 1989, according to data released by MAS. Domestic banking units loan growth accelerated to 24.2% yoy in May, its strongest since Sept08, while the mom growth rate for industry consumer loans picked up at 2.5%. In terms of yoy growth, consumer loan growth soared to a new multi yr record high of 20.3%....
Among key business loan subsectors, manufacturing loan growth accelerated sharply at 26.8% yoy, while building and construction loans registered their tenth consecutive mth of positive yoy growth. Loans to non-bank financial institutions continued to power ahead to a record high of 34.9% yoy and general commerce loan growth swelled to 46.1% yoy. Car loans remained the weakest of all consumer loans, shrinking for 26 mths in a row…
BNP Paribas note that business loans will should continue to remain robust for the next three mths given the strong syndicated loan pipeline and at current levels, SG banks are priced at historical P/E means. We note that sector has highly varying views on top pick, with BNP Paribas touting OCBC as house top pick with $11 TP, while Deutsche favours DBS and Macquarie favours UOB (TP $23.16)
Among key business loan subsectors, manufacturing loan growth accelerated sharply at 26.8% yoy, while building and construction loans registered their tenth consecutive mth of positive yoy growth. Loans to non-bank financial institutions continued to power ahead to a record high of 34.9% yoy and general commerce loan growth swelled to 46.1% yoy. Car loans remained the weakest of all consumer loans, shrinking for 26 mths in a row…
BNP Paribas note that business loans will should continue to remain robust for the next three mths given the strong syndicated loan pipeline and at current levels, SG banks are priced at historical P/E means. We note that sector has highly varying views on top pick, with BNP Paribas touting OCBC as house top pick with $11 TP, while Deutsche favours DBS and Macquarie favours UOB (TP $23.16)
SG Market
SG Market: Spore shares are likely to see more upside following gains on Wall Street, helped by some upbeat US economic data. Vol has also picked up nicely on SGX yday, albeit aided by some window dressing but is an encouraging sign going into 3Q as sentiment improves. Support for the STI now sifts to 3090 & resistance at 3150. Corporate news flow is thin; CitySpring resuming trade after announcing a rights issue to raise as much as $210m.
Radiance buys Global Invacom Hldgs for US$49m in an RTO. Auditirs warn of missing cash at China Gaoxian & SGX Raps KXD Entertainment.
Radiance buys Global Invacom Hldgs for US$49m in an RTO. Auditirs warn of missing cash at China Gaoxian & SGX Raps KXD Entertainment.
Thursday, June 30, 2011
Progen
Progen: A new investor, private co Golden Wang Holdings is acquiring 54.4m shares approx 20% of share cap of Progen for $12.2m from the exec chairman, MD and founder of the co, Mr Lee. The founder Mr Lee will continue to hold a 9.7% stake in Progen. Golden Wang has diverse businesses involving mechanical and engineering, real estate dev and supply of building hardware...
Progen is an invt holding co dealing in air conditioning systems, cooling equipment as well as leasing of factory and office space. Progen is up 21.4% today on back of news trading at current P/E of approx 6.0x, and has most recently posted a FY10 net profit of $3.9m.
Progen is an invt holding co dealing in air conditioning systems, cooling equipment as well as leasing of factory and office space. Progen is up 21.4% today on back of news trading at current P/E of approx 6.0x, and has most recently posted a FY10 net profit of $3.9m.
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