22-02-2014, 08:48 PM (This post was last modified: 22-02-2014, 08:49 PM by felixleong.)
(22-02-2014, 08:41 PM)greengiraffe Wrote: Hi Felix,
Could you clarify your earlier postings:
Lastly I wanna say, FCL is not a counter that you would wanna make a big bet on.
If I had a bucket of FCLs I would probably do pretty well.
GG
[/quote]
I think FCL has quite an amount of uncertainties, thus the big discount to NAV
I think there's an 80% chance for it to do well and minority shareholders being rewarded and 20% chance that things might go wrong.
If would be painful if one makes a big bet and gets caught in the bad situation (the 20%)
However if u have a bucket of stocks like FCL say 20 of them, 16 will do well and the NAV is realized and 4 wouldn't do well and your $$ gets stuck for a long time, but overall u will still make a very good gain.
24-02-2014, 10:04 AM (This post was last modified: 24-02-2014, 10:23 AM by greengiraffe.)
More copycats on FCL coming through...
DBS Vickers initiated coverage with target $2.08.
Rising to the big ranks
Complete value chain player with strong niche
markets in Singapore, China and Australia
Optimising risk and return with geographical
and business diversification, strong balance
sheet to support value creation activities
Initiate with BUY and TP of S$2.08
Complete value chain player with strong niche
markets. We initiate coverage on Frasers Centrepoint Ltd
(FCL) with a BUY rating. As the fourth largest listed developer,
FCL offers investors a sizeable listed investment option with a
market cap in excess of S$4bn and asset value of S$11.5bn.
An estimated 47% of its gross asset value is exposed to
development properties, 33% to investment properties and
REITs, and the remaining to hospitality and other activities. Its
core markets are Singapore, China and Australia.
Geographical and business diversification leads to
superior return metrics. FCL’s diverse geographic and
business exposure that includes both emerging/developed
markets and recurrent/development income, offer investors a
stable cashflow base with good upside growth potential at
optimal risk. This translates to superior core returns metrics of
8-9% ROE when compared to peers. Furthermore, with a
strong balance sheet, the group is well placed to undertake
value creating activities on its investment property portfolio,
with a view to unlocking value in the medium term through
its REIT platform. FCL has a good track record in reading the
residential market trends, particularly in Singapore and this
will stand it in good stead to restock inventory going forward.
Recommend BUY with a TP of S$2.08. We like FCL for
its commanding niche in its key markets of Singapore, China
and Australia and strong pre-sales that provides a very visible
earnings stream over the next 2-3 years. Its sturdy balance
sheet will enable the group to reinvest for future growth, as
well as undertake value creation activities in its current
portfolio. Key risk is its small free float, with major
shareholders, TCC Group and Thai Beverage holding a total
87.9%, which we believe can be addressed in the longer run.
of course, we are value buddies. Anyway Lock Mun Yee is a senior analyst. When you are running dearth of ideas especially in a underweighted sector, they have to look for fresh ideas.
Moreover, some of these researches are useful for corporate financing work - in this case I think quite a number of investment bankers are looking for a slice of fees associated with eventual placement of FCL or even F&N shares.
I don't think Thai Towkay wants to keep holding to illiquid stocks when he has tried so hard to keep them both listed
Vested
(24-02-2014, 10:22 AM)cfa Wrote: Believe these analysts also visit VB for opinions , especially those young analysts.
Not bad achieving 44.44% sales on weekend launch - so another project by FCL getting off the books and lesser exposure to the current rot in Singapore residential mkt
Rivertrees launch helped by demand for smaller units
But brisk sales not a sign of recovery in market sentiment, say consultants
Published on Feb 25, 2014
The 495-unit Rivertrees Residences condominium (depicted in poster above) in Fernvale sold 220 units over the weekend, said developer Frasers Centrepoint. -- ST PHOTO: LIM SIN THAI
By Melissa Tan
KEEN demand for smaller, more affordable private homes gave a fillip to weekend sales at another new launch in Sengkang.
The 495-unit Rivertrees Residences condominium in Fernvale was launched on Saturday and sold 220 units over the weekend, its developer Frasers Centrepoint said yesterday.
Consultants said the sales were encouraging and reflected underlying demand from upgraders, but cautioned that it did not signal a recovery in market sentiment.
Rivertrees' sales figure was a little higher than opening weekend sales at its next-door neighbour Riverbank @ Fernvale, which sold slightly more than 200 units two weekends ago.
The 555-unit Riverbank, developed by UOL, also moved slightly more than 10 units over the past weekend, a spokesman said yesterday, adding that it had sold out all its one- and two-bedders.
This brings its cumulative sales to roughly the same level as Rivertrees'. Its selling price was slightly over $1,000 per sq ft (psf) on average.
R'ST Research director Ong Kah Seng said sales volumes could have been similar because while Rivertrees was slightly more expensive than Riverbank, it was also nearer to the Layar LRT station.
Smaller units were more popular at both projects. Consultants said this indicated that buyers were now extremely conscious of the total unit price as opposed to the psf price.
Frasers declined to give a sales breakdown but said yesterday that its two-bedders and strata landed houses at Rivertrees sold "particularly well".
The landed houses, all 1,528 sq ft each, were sold for $1.75 million to $1.78 million per unit. This works out to $1,145 to $1,165 psf.
The one- and two-bedders were launched at an average of $1,130 psf, and three- and four-bedders at $1,040 psf on average. Buyers at Rivertrees were a mix of Housing Board upgraders and investors.
"There is still depth in the market," said Mr Cheang Kok Kheong, chief executive of development and property at Frasers.
CBRE research head Desmond Sim said Rivertrees sales were promising, especially coming at "this time of the market where there seems to be more bad news than good news".
He added that since buyers were increasingly selective, some might have moved on to Rivertrees if they missed out on the best units at Riverbank.
Mr Ong also said the sales at both Fernvale projects were "encouraging" but cautioned that it did not mean the overall private residential market was doing well.
"It's unclear whether the homes will fetch good investment returns, so they're better suited for owner-occupiers rather than investors," he added.
FCL bagged the land in 07 and launched the project in 2010. The A$1bn sales marked was crossed when they file the attached PR article on SGX on 19 Feb 14.
For developments, a typical duration from buying land to securing development approvals will require at least 2 years and lots of money to be written off at drawing up the development plans. Thereafter, launching the project and securing bank financing will take easily 6 - 9 months and the construction is easily another 3 years. This is drawing from St******'s North Ryde development experience that was first highlighted in 2010 announcement till current expected completion date in 2017.
Any company that wants to make reasonable returns from Australia need to have a lot of financial muscle and stamina. As for investors, I have always emphasis that the quick Singapore/HK experience of evaluating property development should never be applied in Australia.
It will replace Robinsons when the latter's lease expires in May
Published on Mar 05, 2014
Department store Metro (above) will have its new Centrepoint store, which promises a ''departure from the typical shopping experience'', up by the end of the year. -- ST FILE PHOTOS
Department store Metro (above) will have its new Centrepoint store, which promises a ''departure from the typical shopping experience'', up by the end of the year. -- ST FILE PHOTOS
Robinsons (above), which is ending its 31 years at the site, set up its new 186,000 sq ft flagship store at The Heeren in November. -- ST FILE PHOTOS
By Cheryl Ong
HOME-GROWN department store Metro will replace another home-grown player Robinsons as the anchor tenant at The Centrepoint shopping mall in Orchard Road.
The firm's fifth store here will occupy six floors or 130,000 sq ft of retail space at the complex after the Robinsons lease expires in May, ending its 31 years at the site. Robinsons set up its new 186,000 sq ft flagship store at The Heeren in Orchard Road in November.
Metro said in a joint statement with Frasers Centrepoint - the owner of the mall - yesterday that it will have completed the move into The Centrepoint by the end of the year.
Metro chief executive David Tang said the new store will be a "departure from the typical shopping experience".
It will feature products and brands that are exclusive to the retailer, and also have eateries within the shopping areas, which is a first for Metro.
For Metro, this means a return in a big way to Orchard Road, where the Centrepoint outlet will be the largest among its five stores. Currently, it has three outlets in malls outside the CBD, at Causeway Point, City Square Mall and Compass Point.
A fourth outlet is located at the Paragon mall, which occupies 77,000 sq ft of space. The Straits Times understands that Metro will remain at Paragon.
"The opening of another store on Orchard Road, the main shopping belt in Singapore for both locals and tourists, will allow us to distinguish the two stores and serve different groups of customers," a Metro spokesman added. She added that the new store will be targeted at "young, urban families".
However, she declined to comment on rent levels at The Centrepoint.
A Frasers Centrepoint spokesman said signing up Metro fits its plans to "tweak the look and feel to revitalise the mall".
Refurbishment work for the Metro store will start shortly after Robinsons moves out of The Centrepoint.
Frasers added in a statement that the mall will have a new focus on contemporary fashion and lifestyle products, with different clusters catering to high street fashion, cosmetics, lifestyle and sports.
Mr Desmond Sim, research head at property firm CBRE, said The Centrepoint is likely to be the biggest winner in the move, as Robinsons has helped establish the mall as a family shopping destination over the years. Given Robinsons' large presence at the mall, its departure would leave a very big gap to fill. "Now that The Centrepoint has found a tenant in a similar trade, Metro is well placed to jump in and carry on this theme," he said.
Retiree Lee Joo Geck, 71, says she will miss Robinsons at its old location as it has been the one constant in Centrepoint throughout its facelifts over the years. But she thinks having Metro there may not be a bad idea. "Metro has mass appeal and carries a wide variety of brands and items, it could bring in more shoppers."
Building on a strong base
• Revving all growth engines
• High earnings visibility from locked in sales and
recurring income
• Maintain Buy, TP S$2.08
Key takeaways from HK NDR. FCL met with 17 investors
during our recent HK non-deal roadshow. Investors welcome
a new property name with a decent market cap in excess of
S$4bn within the listed space. Highlights of discussions
centred around the group’s current business model including
geographic and asset class allocations, potential for value
unlocking from its hospitality assets, market outlook and
future direction and strategies particularly after the presence
of TCC Group as major shareholders, dividend payout ratio
and key liquidity issues such as free float.
Putting growth building blocks in place. Management
reiterated that the group would continue to focus on building
both its recurrent and development businesses to maintain a
superior ROE metric. Singapore would continue to make up
the bulk of GAV within this growing pie. Management is keen
to selectively landbank in Singapore under current market
conditions. In Australia, in addition to Perth and Sydney, it
could look to explore Brisbane and Melbourne in the medium
term. In China, it would remain in its existing footprint for
economies of scale. The commercial property business should
continue to expand with its 2 REIT platforms and clear growth
pipeline from Changi City Point as well as 3 development
assets. Within the hospitality business, where it currently owns
c30% of the 8008 rooms under management, it plans to
grow rooms under management to >14,400 by 2017,
including potential inventory from TCC Group. Longer term,
we believe by adopting an asset light strategy, would enable
the group to improve ROE and ROA metrics of this business.
Maintain Buy, S$2.08 TP. We retain our Buy call with a TP
of S$2.08, premised on a 30% discount to RNAV. FCL is
currently trading at 0.7x P/Bk NAV and at a steep discount to
our RNAV estimates, which includes locked-in profits from
residential projects as well as marking to market its
commercial and hotel assets. With a strong balance sheet and
strong income visibility, we believe the gap between share
price and asset backing would narrow once the limited free
float issue is addressed.
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