Oxley Holdings

[Nick]

I am wondering whether am I missing out something in this property developer company ? This small cap company is currently trading at $0.40 per share. It generated $1.8 million net profit in 1Q 11 which translates to an EPS of 0.08 cents. It has equity of $13 million or a NAV of 0.94 cents.

Is there a reason why the market is valuing it with a PER of 125 and P/B of 42.55 ?

Perhaps, they are developing plenty of projects which they have yet to book in the P&L Statement ? Noticed they got quite a fair bit of properties under development in their current assets.

(Not Vested)

[barista]

shoebox unit developer?

[starbugs]

Oxley just doesn't have the track record. When I saw the IPO prospectus, I had a feeling it would tank.

[Poowawa]

http://www.nracapital.com/netresearchV4/...log_no=612

The rise in Oxley could be because of this article.

[Nick]

http://www.nracapital.com/netresearchV4/...log_no=612

The rise in Oxley could be because of this article.

Thanks for the link. I knew there was something more than meets the eye for Oxley. A lot of hidden potential which may or may not be fulfilled. At least, I now understand why people are buying at current prices haha !

[Nick]

ACQUISITION OF FREEHOLD PROPERTY FOR $57.1 MILLION

http://info.sgx.com/webcoranncatth.nsf/V...50034A388/$file/OxleyAnncFinal.pdf?openelement

[Musicwhiz]

ACQUISITION OF FREEHOLD PROPERTY FOR $57.1 MILLION

http://info.sgx.com/webcoranncatth.nsf/V...50034A388/$file/OxleyAnncFinal.pdf?openelement

Based on NLA, that's about S$30,000 psm which they paid for. Is this reasonable, or expensive?

Comment are appreciated, as I am still learning about property. Thanks.

[Jon-san]

Well, considering it's plot ratio and it's location, i don't think so. With a net lettable area of only 1899sqm but site area of 422sqm and plot ratio of 11.2, there is actually alot of wastage of the land... Moreover, when you convert (based on your calculation of $30,000psm) the units to psf, that works out to about $1,256psf. Plus, it is freehold! So, depending on their redevelopment plans, it may work out well for them in the end, depending upon the prevailing property market trend at that time. At least, i think that's how it looks like from a layman's point of view.

[starbugs]

Well, considering it's plot ratio and it's location, i don't think so. With a net lettable area of only 1899sqm but site area of 422sqm and plot ratio of 11.2, there is actually alot of wastage of the land... Moreover, when you convert (based on your calculation of $30,000psm) the units to psf, that works out to about $1,256psf. Plus, it is freehold! So, depending on their redevelopment plans, it may work out well for them in the end, depending upon the prevailing property market trend at that time. At least, i think that's how it looks like from a layman's point of view.

At $1256 psf for land, breakeven price is about $1700psf. Grade A rental is now about $10 psf/mth. Gross rental yield is thus about 7% at breakeven price, which is not a lot of safety factor. The more established listed developers probably work with a much higher safety margin.

Obviously Oxley is betting that office rental will continue to go up (and bring up the value of the new building), a bet which may not pay off. This tells you a bit about how risk-inclined the company is despite its lack of track record.

[Vseeker]

Food for thought: LionTeckChiang undervalued, or Oxley being too aggressively valued !!!

LTC's Arumugam lands are located right next to Macpherson MRT station (cc10),
while Oxley's UBI Road 1's site is at some 500m away from Tai Seng station (cc11).

Below details how undervalued LTC is....
but NOT suggesting that values will get unlock anytime soon.

Out of the $443m Capital Values that Oxley prescribed for its land banks (15 sites),
the lion share of $218m (amounting to $0.15 per share ) came from the land parcel at UBI Road 1

details on Oxley Land's UBI Road 1 site: MK23-06912M (ref : recent IPO Prospectus)
Zone B1, with only 60-yrs lease
landarea = 34,853 sqM or 375,150 sqF
GFA= 87,103 sqM or 937,571 sqF
landcost** = $170m or $181 psfppr
Gross Dev Values (valuation by Colliers Intl in Aug2010) = $514m or $548 psfGFA
Total dev Cost estimated = $296.24m ==> GIVING Capital Values of $218m
(** NB: actually, Oxley's original landcost for its UBI Road 1 landsite, (won thru URA tender) is only $158.1m or at only $169 psfppr)


In comparision, LTC's values its 4 Arumugam freehold ppties for only $79.8m (as at Jun-2010 results )
and these sit on 33,229 sqM of freehold lands with potential redevelopment GFA of 894,176 sqF
==> so LTC valuing its freehold lands for only $89 psfppr !!! and at $273 psf NLA base on existing buildup space of 292,000 NLA

Oxley's UBI Road site are only of 60-yrs leasehold, and is located around 500m away from Tai Seng MRT station separated by a major road intersection
in comparision, LTC's Arumugam ppties are freehold and located right next to the MacPherson MRT station

Clearly LTC's freehold land site at Arumugam, should certainly be worth much more than Oxley's 60-yrs lease land parcels at UBI Road 1,
and even if we just value LTC's freehold lands at the same price that Oxley paid in the URA tender for the 60-yrs lease land at UBI Road 1 (i.e at only $170 psfppr),
LTC's Arumugam freehold lands will still be worth $152m or $0.97 per share vs its current mktcap of only $67m (at price $0.43)

However if we assign Gross Development Values of $500 psf, then LTC's land is worth a staggering $447m or $2.85 per share !!!
==> too aggressive ?? well, if Collier Intl can value Oxley's 60-yrs lease land at $547 psf,
why shouldn't LTC's freehold site fetch $500 psf ???