MARKETS & INVESTING | Staff Reporter, Singapore

Simon Says: I'm buying my stock, you should too

SC global CEO Simon Cheong spent $3 mn buying up shares in his own company last week.

Property stocks are trading at deep discounts to net assett value, and at least this insider is buying.

Here's more from DMG:

Chairman and CEO Simon Cheong snapped up 2.26m shares of SC Global at an average of $1.36/share last week. The trade increased his total holdings in the company to 222.34m shares, or 53.91% of the issued capital. It is not surprising that Simon Cheong continues to see value in his own company given the huge discount to RNAV that the stock is trading at. SC Global recently announced a 15-fold increase in net profit to S$72.8m for 1Q11, fuelled by higher profit recognition for its development projects especially with the TOP of Marq at Paterson Hill during the quarter. Hilltops obtained its TOP in April and will underpin profitability growth for the current quarter.

In our view, SC Global is the most leveraged play on the luxury residential sector in Singapore with its prime landbank across 4 projects: Marq, Hilltops, Seven Palms and the Ardmore. Given the low land-cost of under $1000 psf ppr for the Marq and Hilltops, a pickup in sales will help crystallize the value of its landbank. SC Global recently sold a unit at the Marq for a record price of $5,842 psf and we believe the company will continue to actively market the projects that have recently obtained TOP, i.e. Marq and Hilltops.

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