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CapitaLand's share price continues to offer compelling value: OCBC
Below is the highlight from the research note of OCBC Investment Research on CapitaLand May 25, 2011.
| CapitaLand's (CAPL) serviced residence business unit, The Ascott Limited (Ascott), announced it has acquired two new management contracts in Malaysia and Indonesia. The 200-unit Somerset Damansara Uptown Petaling Jaya is Ascott's first entry in Damansara Uptown, Malaysia, and is slated to open in 2016. The 187-unit Somerset Kencana Jakarta in Indonesia is expected to open in 2014. Ascott also acquired, for S$117.1m, 100% of SNC Costes K (SCK) and would redevelop its Parisian properties into a 106-unit serviced residence building "Ascott Arc de Triomphe Paris" and another apartment building for corporate leases. We believe CAPL is likely to continue to execute its serviced residences strategy expediently. Including this Paris acquisition, capital redeployment increased to $452m after a portfolio divestment to Ascott Residence Trust in 2HQ10. In our view, CAPL's share price continues to offer compelling value at current levels. Maintain BUY with fair value estimate of $4.05 (at parity to RNAV). |
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