Ying Li International Real Estate

[RBM]

Hello 2V,

Thanks for your posting 2V. You may well be correct on the fund raising - my apologies if I did not read your earlier posting carefully enough. I read tonight that Ying Li will be fully redeeming S$ 195 Million in its (silly) Convertible Bonds............ and then cancelling them.

http://info.sgx.com/webcoranncatth.nsf/V...7001392B2/$file/YingLi_Annc_Redemption_Bonds.pdf?openelement

Vested

my intrepretation of the new CEO is that Co may be arranging a share placement, if I own the shares and going to subscribe placement shares at lower price. That will be a good abritrage opportunities...

Of course my intrepretation may be wrong, future will tell...

[2V.]

You are welcome RBM, I suspect this is probably the cause of the selldown. The redemption will definitely affect Co short term cashflow, given current property curb and high RMB interest rate. I have not check the lastest cashflow statement, cant comment the impact...

Hello 2V,

Thanks for your posting 2V. You may well be correct on the fund raising - my apologies if I did not read your earlier posting carefully enough. I read tonight that Ying Li will be fully redeeming S$ 195 Million in its (silly) Convertible Bonds............ and then cancelling them.

http://info.sgx.com/webcoranncatth.nsf/V...7001392B2/$file/YingLi_Annc_Redemption_Bonds.pdf?openelement

Vested

my intrepretation of the new CEO is that Co may be arranging a share placement, if I own the shares and going to subscribe placement shares at lower price. That will be a good abritrage opportunities...

Of course my intrepretation may be wrong, future will tell...

[BeDisciplined]

No dividend....

[RBM]

No dividend....

No dividend was anticipated in the recent FY results announcement BeDisciplined - Ying Li hasn't paid a dividend in over 4.1/2 years, i.e. since August 2008. I'll be opening one of my nicer bottles when they do pay one.

Vested

[Nick]

Hi RBM,

I noticed SIAS has written a research report update on Ying Li today - https://brokeragesreport.googlegroups.co...FIQ&part=4 [Report] - titled 'Growth Plans Remain On Track'.

(Not Vested)

[kayhian]

Hi RBM,

I noticed SIAS has written a research report update on Ying Li today - https://brokeragesreport.googlegroups.co...FIQ&part=4 [Report] - titled 'Growth Plans Remain On Track'.

(Not Vested)

wow .... 2013 should be a good year for Ying Li

[kizlo]

I have a couple of questions regarding Ying li.

1.) Is there some way to deduce how much they paid for land for their development projects in the financial statements? How about construction costs? From what I know they will disclose maybe the cost of 1 or 2 projects in the notes but never the cost of everything.

2.) Does anybody know where to find the bond prospectus for the 2010 issue of convertible bonds? Is there a prospectus? I've searched for hours and can't find it.

[d.o.g.]

2.) Does anybody know where to find the bond prospectus for the 2010 issue of convertible bonds? Is there a prospectus? I've searched for hours and can't find it.

The circular to shareholders seeking approval to issue the CBs is here:

http://info.sgx.com/listprosp.nsf/5ec09b...d000f62ad/$FILE/YingLi%20Shareholders%20Circular%20-%20Clean.pdf

Appendices 1 and 2 summarize the key points. The circular notes on page 22 that the Subscription Agreement for the CBs was available up until the date of the EGM seeking approval for the CBs i.e. 25 Feb 2010. Presumably if you want to look at it now you'll have to talk to the company secretary.

[RBM]

A couple of Analyst pieces on Ying Li were recently made available. The key assertion of both pieces is that the recent sell down in Ying LI’s share price has gone too far. I'd like to think they are right but, personally speaking, I'm not so convinced (see below).

The first is a MayBank Kim Eng report issued last Monday, 1st April 2013. The Kim Eng analyst asserts that the recent sell off in Ying Li’s share price is overdone, citing the truism that Ying Li is focused on commercial real estate and the PRC Governments’ recent cooling measures were primarily targeted on residential properties. The report also seems to place a great deal of faith in the recently appointed new CEO…………………………..

http://www.remisiers.org/cms_images/rese...104131.pdf

The second is a UOB Kay Hian note – their analysts say that………………..
QUOTE …………………….the sell down of Ying Li stock is unwarranted UNQUOTE

Analysts: Brandon Ng, CFA & Andrew Chow, CFA

Ying Li’s share price declined 9% after China announced several cooling measures for the residential property sector. These measures include higher down payments, increases in residential land supply and accelerated development of social housing.

We think the sell-down is overdone as the company’s current portfolio of developing properties comprises less than 15% in residential properties (mainly International Plaza, where more than 95% is sold in all the four phases).

The financial impact of these new policies to Ying Li appears limited.

“REITing” the retail malls to recycle capital. Ying Li has plans to transfer its retail malls into a trust vehicle for listing to monetise the assets and recycle the capital.

This is positive as the proceeds could be recycled into accretive new investments as management believes in the long-term growth prospect of Chongqing and sees opportunities to
secure good land parcels for commercial property developments.

Maintain BUY with a target price of S$0.65 (unchanged). Our targeted price is based on a 21.8% discount to our RNAV of S$ 0.83/share. The discount is in line with the average discount for Chinese developers under our coverage.
UNQUOTE

Although I’m vested in Ying Li and, although I would like to hope that the bullishness of these analysts is well placed, I’m not so sure. I was in Chongqing this past week and clearly the PRC Government’s recently announced property cooling measures have made for a more somber mood, including amongst those business-people involved with commercial real estate – I sense the “knock-on” effect of these Government cooling measures may be underestimated by our Kim Eng and Kay Hian chums. I hope I'm wrong. Just my two cents worth.
Vested

[greengiraffe]

Property developer Ying Li to explore new frontiers

Published on Jul 22, 2013

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Mr Ko became CEO and executive director of Ying Li in March. The Chinese property developer's next phase of growth aims to go beyond developing mixed-use property and into "thematic" real estate. -- PHOTO: DESMOND LUI FOR THE STRAITS TIMES

By Rachel Scully

CHINESE property developer Ying Li International Real Estate has kept a low profile since its listing on the mainboard in 2008 but the firm now wants investors to know that it has aggressive expansion plans.

Ying Li's transformation will involve raising capital, entering new markets, developing more ambitious real estate projects and spinning off a real estate investment trust (Reit).

The success of this wide-ranging strategy falls on the shoulders of Mr Ko Kheng Hwa, 58, who came on board as Ying Li's chief executive and executive director in March.

He was formerly the CEO of Singbridge International Singapore, a wholly owned unit of Temasek Holdings, which primarily develops and invests in large-scale integrated townships in China.

"We will expand our core business in Chongqing while entering new markets and investing in new real estate products," Mr Ko said in an interview with The Straits Times.

He has had 34 years of experience in the government service and government-linked companies, holding top positions at Keppel Corp, the Economic Development Board and JTC Corp.

Earlier this month, Ying Li also roped in Mr Tan Kiang Hwee, 50, the former chief executive of Temasek-owned urban planner Surbana, as its chief operating officer.

Since it started in 1993, Ying Li has focused on developing mixed-use commercial and office buildings in Chongqing's core central business district and selling them off, a business that has helped it to amass a market capitalisation of about $965 million.

But Ying Li has now set itself new targets. Its next phase of growth aims to go beyond developing mixed-use property and into "thematic" real estate.

Its buildings will house companies in the same industry class together for that additional competitive edge, akin to a media, health-care or education hub.

Mr Ko said Ying Li will also look at building residential townships which will offer social and commercial amenities.

Moreover, Ying Li will widen its focus beyond Chongqing's business district and suss out opportunities in the suburbs, and even possibly to other second- and third-tier cities in China.

"We want to build critical mass, presence and grow our reputation in these selected cities," said Mr Ko.

He noted that Chongqing has been selected by the Chinese government as one of the non-coastal regions to be developed under the "Go West" policy. Businesses there can therefore expect better incentives, infrastructure and policy implementation to drive economic growth, he said.

To fund these expansion plans, Ying Li will be placing out new shares to targeted investors who can contribute capital as well as add value to the business through their networks.

It will also issue bonds and consider entering joint ventures for certain developments. Finding a partner will allow Ying Li to be involved in more projects than when it was self-financing all its developments.

In the medium term, Ying Li is looking to list a real estate investment trust for its malls. Ying Li already owns and runs two retail malls and a third one, the size of VivoCity, is slated to open by the end of the year. Its malls, land banks and some office units which it retains are valued at about seven billion yuan (S$1.4 billion).

Plans are also in motion to make operations at Ying Li and its projects more eco-friendly and green by Chinese and international standards.

rjscully@sph.com.sg