RBS upgrades City Developments (C09.SG) to Hold vs Sell and lifts its RNAV-based target price to $11.90 vs $10.93 to reflect the higher valuations of the developer’s commercial properties and its Millennium & Copthorne (MLC.LN) unit.
“We expect the capital value of CDL’s commercial portfolio to appreciate next year on the back of higher transaction volume and rents.”
CityDev (C09.SG) +0.6% at $13.12 after pullback from current November high of $13.50 late last week to end flat for last 3 sessions.
Interest however, subdued as volume thin. Being Singapore’s largest residential developer by land bank, CityDev deemed most at risk of any additional government measures to rein in housing prices, with upside for stock hence likely limited in near term.
“CDL was expecting the mid-high end residential market to recover in 2010, but this has not yet played out,” says Morgan Stanley; has Equalweight call with $11.87 target.
Adds, while developer still receiving enquiries for its high-end projects, asking prices not at desired levels, “foreign demand is less than in the previous up-cycle” with demand from US and Europe down, Chinese buyers being “very specific on their requirements”.
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CityDev (C09.SG) +0.5% at almost 9 weeks high of $12.82, supported by news of developer’s plan to sell 21-storey freehold Singapore office building for $215 million, says Dow Jones.
Privately-held Oxley Consortium has received offer to buy The Corporate Office, located at Singapore’s central business district.
Move marks CityDev’s latest divestment of its non-core assets, with recent sales, both finalised and proposed, including Singapore’s Chinatown Point, Tanglin Shopping Centre, plus site in Kuala Lumpur.
CityDev (C09.SG) down 0.3% at $11.64 in thin trade, not swayed by brisk sales at yesterday’s launch of developer’s new Singapore mass-market condo, 642-unit NV Residences, with bulk of 200 flats released for sale taken up, according to Dow Jones.
“Given the recent government measures, the take-up is respectable but clearly reflects increased cautiousness from buyers,” says Deutsche Bank, which has Sell call with $10.20 target; expects general housing demand to slow in near term, with planned launches by developers potentially deferred.
Light volume suggests selling pressure contained but also means any subsequent buying interest could be muted. Support tipped at 10-day moving average, last at $11.45.
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Nomura upgrades CityDev (C09.SG) to Neutral from Reduce, lifts target price to $12.26 from $9.57, pegged at parity to fully-diluted NAV, to account for higher capital value assumptions for developer’s commercial, residential assets, according to Dow Jones.
Nomura says CityDev’s 38% asset exposure to Singapore commercial property market is defensive, although 24% exposure to prime luxury residential segment could be risk given potential headwinds arising from recent housing-market curbs.
CityDev (C09.SG) remains top percentage decliner among Singapore blue chips, off 4.7% at $10.92, extending yesterday’s 4.2% loss, as stock deemed most vulnerable to latest property-market curbs with developer having largest land bank in country, says Dow Jones.
Negative momentum gaining strength as volume more than 3x average volume of 1.6 million shares over last 50 days. Stock now below 200-day moving average, a bearish signal. Near-term support at $10.56 (June 30 low).
Wing Tai and City Developments have relatively greater exposures to the mass residential segment of the market.
DMG Research downgrades City Developments (C09.SG) to Neutral from Buy due to slowing sales in Singapore mass market; cuts target price to $10.60 from $10.88, according to Dow Jones.
DMG says while CityDev’s large landbank, management still look good, “the stock will trade rangebound due to the sector-wide sales slowdown.”
CityDev (C09.SG) +1.3% at $11.02, in line with gains by other Singapore blue chips, although light volume suggests investors yet to warm up to developer’s $250 million sale of its entire retail holding, office units at Singapore’s Chinatown Point, according to Dow Jones.
Singapore property developer City Developments (CTDM.SI) said on Tuesday it has agreed to sell ChinaTown Point for $250 million to Perennial China Point LLP.
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CityDev (C09.SG) +0.7% at $10.98, bucking decline by most other Singapore developers (FTSE ST Real Estate Holding & Development Index off 0.3%), says Dow Jones.
Hopes of good take-up for company’s upcoming Singapore residential development, The Concorde @ Thomson, supportive. CityDev said in May it will launch 2 more projects in coming months, including 157-unit Concorde.
Kim Eng Securities, which has Buy call with $13.20 target, tips average selling price of $1,300 psf vs estimated breakeven price of $876 psf.
Adds hotel arm Millenium & Copthorne’s (MLC.LN) recent plan to sell its stake in Singapore’s Tanglin Shopping Centre could add up to $0.15/share to CityDev’s RNAV: “We expect positive catalysts from successful property launches and possibly new acquisitions/divestments.”
Orderbook quotes suggest minimal upside beyond $11.00, last breached in April.
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CIMB downgrades CityDev (C09.SG) to Underperform from Neutral, cuts target price to $11.08 from $11.46 after marking to market developer’s stake in Millennium & Copthorne Hotels (MLC.LN), says Dow Jones.
CIMB says while M&C’s valuations not demanding at 0.7x P/B, investors likely unwilling to pay up to mean valuations of 0.9x P/B amid current global uncertainties.
As developer derives bulk of NAV from Singapore market, investors naturally concerned home sales may slow if government continues to intervene, especially in wake of recent official data showing spike in new home sales by developers in Singapore last month vs March.
CityDev (C09.SG) surrenders gains is down 0.9% at $10.76 vs early high of $11.00 (+1.3%), as investors sell on strength after sustained rise over last five sessions, according to Dow Jones.
CityDev (C09.SG) +1.5% at $10.76, extending recent gains, as investors hopeful developer will turn in strong 1Q10 results tomorrow, says Dow Jones.
Nomura has raised City Developments (C09.SG) target price to $9.62 from $9.26 after increasing FY10-12 earnings forecasts by 12%-14% to factor in better-than-expected selling prices for developer’s high-end W Residence project in Singapore, according to Dow Jones.
Singapore’s Straits Times Index rose 0.6 to 2,766.11 as of 10:17 a.m. More than three stocks gained for each that dropped on the 30-member gauge. Shares on the measure trade at 14.6 times estimated earnings, compared with about 10 times at the start of 2009, according to data compiled by Bloomberg.
CapitaLand (CAPL SP), Southeast Asia’s biggest developer, lost 0.3% to $3.77 while City Developments (CIT SP), Singapore’s second-biggest developer, fell 0.6% to $10.22 as the government increased development charges for residential properties by 8% for condominium housing projects and by 12% for free-standing homes. The new charges will take effect from today.
City Developments (C09.SG) has pared early gains triggered by better-than-expected 4Q09 earnings. The stock is now trading flat at $10.32 vs $10.42 initially, although still faring better than other large-cap developers and blue chips (STI off 0.3%).
OCBC Investment Research says earnings outlook remains positive as developer yet to book profits from three Singapore residential projects, noting management’s guidance for minimal impact on sales from recent government measures to curb property speculation.
City Developments (CTDM.SI), Southeast Asia’s second-largest property firm, posted today a 76.7% rise in fourth-quarter net profit, helped by strong Singapore residential property prices.
CityDev reported a net profit of $176.7 million for the three month ended December, up from $100 million a year ago. The earnings beat the $131 million consensus estimate from Thomson Reuters I/B/E/S.
Singapore’s benchmark Straits Times Index (.FTSTI) fell 0.7% to end at 2,762.14 yesterday. US stocks closed higher last night after Federal Reserve Chairman Ben Bernanke reassured lawmakers interest rates will remain low, promising more cheap money to investors.
City Developments (CTDM.SI) posted a 77% rise in fourth quarter net profit of $177 million, beating the consensus estimate, on higher profits from property development. The company said it achieved its highest full year revenue and second highest profit since its inception in 1963.
