GuocoLand

[Curiousparty]

Anyone has any views pls, especially on the bolded portion?


==================

Potential Restructuring Could Crystallise Value. With GuocoLand's share price trading at a P/NAV multiple of just 0.40x and ~4% yield, valuations are attractive. With a growing portfolio of commercial assets, the potential securitisation of GuocoLand’s income-producing portfolio or conversion into a “stapled security” could be a significant catalyst for GuocoLand's share price, with the potential upside ranging from 50% to 100%.

Guocoland - The Best Is Yet To Come (sginvestors.io)
https://sginvestors.io/analysts/research...2023-09-07

[weijian]

Hi CP,
I do not have any view but insiders might have some views. Their views are much better than sell-side analysts.

A minority posted a question to Capitaland Investment some time back and Guocoland was mentioned.
https://youtu.be/UXO4TY-ngmo?t=3065

You can hear the answer from CLI executives yourself (inclusive of the CFO's mangled look towards his colleague before answering the question). But of course, things are dynamic and could change in the next decade!

[CY09]

https://links.sgx.com/FileOpen/SGX-Conde...eID=817336

With the absence of a strong revaluation gain on its investment properties, Guocoland earnings have shown how much is largely due to recurring.

At DPS of 6 cents, it does seem manageable and about 100% payout ratio (netting off fair value gains). NAV of Guocoland is $3.90 but this is due to its investment assets.

In terms of development sales, it seems Guocoland has enough developments until end 2026 to recognise for revenue. However, the amount of residential sales is declining. My view i Guocoland is becoming like a commercial REIT which is leveraged, dishes out 6 cents dividend. But if development properties do draw out and it becomes valued like a REIT, i wonder what dividend yield will it be pegged at? A 5% Dividend seems low but it means there are some further downside based on its current share price.

[ghchua]

Hi CY09,

You have net off fair value gains to derive at 100% payout ratio. But why didn't you add back the allowance for foreseeable losses of $103.8 million in 2H FY24 on its China’s development properties? Because this is just a one off allowance for their future losses and its a non cash item. It shouldn't hit them immediately to affect their ability to pay out dividends.

[weijian]

https://links.sgx.com/FileOpen/SGX-Conde...eID=817336

With the absence of a strong revaluation gain on its investment properties, Guocoland earnings have shown how much is largely due to recurring.

At DPS of 6 cents, it does seem manageable and about 100% payout ratio (netting off fair value gains). NAV of Guocoland is $3.90 but this is due to its investment assets.

In terms of development sales, it seems Guocoland has enough developments until end 2026 to recognise for revenue. However, the amount of residential sales is declining. My view i Guocoland is becoming like a commercial REIT which is leveraged, dishes out 6 cents dividend. But if development properties do draw out and it becomes valued like a REIT, i wonder what dividend yield will it be pegged at? A 5% Dividend seems low but it means there are some further downside based on its current share price.

Hi CY09,

IMHO, Guocoland doesn't even whack like a REIT.

(1) Its gearing is ~80% and would have burst the REIT regulatory limit.

(2) It has tons of development projects on the line, which explains the "high gearing". In the ordinary course of events, it wouldn't be paying out at least 90% of earnings as dividends as it continues its development BU.