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1、,Co.Reg No:198700034EMICA(P):099/03/2012Singapore,Sector UpdatePropertyOverweight(unchanged)Wilson LIEWwilsonliewmaybank-.sg(65)6432 1454,9 January 2013Cherry-Picking ContinuesStaying selective.Property stocks have been strong performers in2012,with the FTSE Real Estate Index rising 48%vis-vis the 2
2、0%gain by the STI.In fact,they have even outperformed the REITs ingeneral,which also had a good run on the back of significant yieldcompression.We have an Overweight for property stocks in 2013,butremain selective.Our top picks are CapitaLand,CMA and Keppel Landfor their diversified business models
3、with China exposure,while wecontinue to favour Wing Tai and Ho Bee for their exposure toSingapores high-end residential segment.,2012 a newsworthy year for property.2012 will be remembered asthe year where new private home sales first exceeded 20,000.This wasdespite the introduction of the Additiona
4、l Buyers Stamp Duty in late2011,which hardly had any impact on the demand for mass markethomes.Some property stocks were in the limelight on the back of M&Aactivities.Wing Tai got the ball rolling when the Chairman made apartial offer to take his familys stake to just over 50%.This wasfollowed by th
5、e ensuing battle for F&N,with particular attention beingpaid to F&Ns property portfolio.Most recently,SC Globals founder MrSimon Cheong is trying to take his company private.China exposure to lend weight to diversified big-caps.Operatingconditions for developers in China appear to be improving,withr
6、esidential developers seeing stronger demand from upgraders andfirst-time buyers.Our China property analyst,Karen Kwan,sees a 5-10%upside in property prices in the first and second-tiered cities overthe next 6-9 months,which will also be beneficial for CapitaLand andKeppel Land.Over the longer term,
7、we expect demand for high-qualityaffordable housing to remain robust on the back of the continuingurbanisation process.In addition,with the new CCP leadershiponboard,we expect more pro-consumption policies to boost retail sales,to morph the Chinese economy into one led by private consumptionrather t
8、han capital investment.Strong retail sales will certainly benefitCMAs portfolio of 59 malls across China.Singapore high-end segment in play for 2013.The mass marketsegment may have underpinned strong new home sales in Singaporefor the last two years,but we think the high-end segment will playcatch-u
9、p in 2013.This is mainly as more savvy investors takeadvantage of the narrow price premium the high-end segment has overthe mass market segment,given the latters strong run over the pastthree years.In addition,the high-end segment in Singapore alsocompares favourably on a regional basis,due to Singa
10、pores politicalstability,transparent legal framework,and its modern infrastructure andamenities.We expect high-end home sales to pick up by 10-15%,whilethe mass market segment is likely to come off the high-base of 2012 asbuyers become more price-sensitive with progressively more marginalhomebuyers
11、trading-down to the EC segment.SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS,Property SectorCapital values supportive of divestments.We expect capital valuesof commercial properties to remain largely firm in 2013,which shouldprovide a conducive environment for developers to div
12、est certainassets,possibly leading to more generous dividends in FY13.Examples include CMAs 50%stake in ION Orchard and Keppel Landsone-third stake in MBFC Tower 3.Our top preference is for retaillandlords,where there remains ample scope for organic NPI growth viaAsset Enhancement Initiatives(AEIs).
13、On the flip side,we remainunderweight on office plays,namely the office REITs,on the back oflofty valuations despite softening spot rents,as well as ample supplyover the next five years.We are neutral on industrial plays,but we arebearish on the hospitality plays which in our view are also susceptib
14、le toheadwinds in the coming year due to staff cost pressures.Risks.In our view,the low interest rate environment is likely to prevailin 2013,suggesting that policy risks remain in the Singapore residentialsector,particularly when economic growth remains lethargic as itundergoes restructuring.Being
15、such an open economy,Singapore willnot be spared from a deeper global recession,which will impactproperty demand across the board,amplifying fears of an impendingoversupply situation.In China,the economy appears to have bottomed,but with the new leadership taking full control only in march 2013,anyn
16、ew policies may take time to work their way through the system.Stock picks.Our top BUY recommendations for their diversifiedexposures are CapitaLand(CAPL SP,BUY,TP SGD4.27)and KeppelLand(KPLD SP,BUY,TP SGD4.74),CapitaMalls Asia(CMA SP,BUY,TP SGD2.53)for its strong retail focus to ride on Chinas grow
17、thin domestic consumption and Wing Tai(WINGT SP,BUY,TPSGD2.50)and Ho Bee(HOBEE SP,BUY,TP SGD2.27)for their high-end Singapore residential exposure.We have SELL calls on CityDevelopments(CIT SP,SELL,TP SGD9.70)for its increased massmarket exposure and challenging hospitality outlook,and also onCapita
18、Commercial Trust(CCT SP,SELL,TP SGD1.35)for its richvaluations despite a soft office leasing market.Property Sector Peer Valuation Summary,Stock,Rec,Shr px,Mkt cap,TP,RNAV,PER(x),P/B(x),Net,Net yield,yield,(%),(SGD),(SGDm),(SGD),(SGD),2012F,2013F,2012F,2013F,2012F,2013F,CapitaLandKeppel LandCapitaMa
19、lls AsiaWing TaiHo BeeSingapore Land LimitedCity Developments Limited,BUYBUYBUYBUYBUYBUYSELL,3.8704.1802.1101.9501.9457.55012.510,16,451.06,455.28,203.11,526.51,349.23,114.211,375.4,4.274.742.532.502.278.209.70,5.345.922.813.573.2511.7112.97,19.915.718.36.38.613.818.8,19.814.728.99.414.515.014.9,1.1
20、1.11.30.70.80.61.6,1.11.01.20.70.70.61.4,1.62.41.43.62.12.60.8,1.62.91.43.62.12.60.8,Simple ave,14.5,16.8,1.0,1.0,2.1,2.1,Source:Maybank KE,9 January 2013,Page 2 of 22,2004Q1,2004Q3,2005Q1,2005Q3,2006Q1,2006Q3,2007Q1,2007Q3,2008Q1,2008Q3,2009Q1,2009Q3,2010Q1,2010Q3,2011Q1,2011Q3,2012Q1,2012Q3,2004Q1
21、,2004Q3,2005Q1,2005Q3,2006Q1,2006Q3,2007Q1,2007Q3,2008Q1,2008Q3,2009Q1,2009Q3,2010Q1,2010Q3,2011Q1,2011Q3,2012Q1,2012Q3,Property SectorFSTE Real Estate Indexs 2012 relative performance15014013012011010090,Source:Bloomberg,FSTRE Index,FSSTI Index,FSTREI Index,Property Price Index by region22020018016
22、014012010080,Quarterly new home sales by region100%90%80%70%60%50%40%30%20%,10%0%Property Price Index of Non-Landed Residential Properties in Core Central Region,Property Price Index of Non-Landed Residential Properties in Rest of Central Region,Uncompleted Private Residential Units Sold in CCR,Unco
23、mpleted Private Residential Units Sold in RCR,Property Price Index of Non-Landed Residential Properties in Outside Central RegionSource:URA9 January 2013,Uncompleted Private Residential Units Sold in OCRSource:URA,Page 3 of 22,CAPL SP,3,205.5,60.8,27.1,39.2,%,3.53,5.34,4.00,3.80,3.40,.,Co.Reg No:198
24、700034EMICA(P):099/03/2012Singapore,Sector UpdateBuy(unchanged),CapitaLandEmbracing Diversity,9 January 2013,Share price:Target price:,SGD3.87SGD4.27(unchanged),Looking bright on most fronts.We like CapitaLands diversifiedmodel,which gives it exposure to various markets and across assetclasses.For 2
25、013,we expect the retail mall business to continue to,Wilson LIEWwilsonliewmaybank-.sg(65)6432 1454Stock InformationDescription:Operates in residential and commercialproperties,property fund management and servicedresidences.Ticker:,drive growth,while the China residential business also looks to bui
26、ld onthe stronger sales momentum enjoyed in 2012.Maintain BUY.New leadership at the helm.Mr Lim Ming Yan has effectively takenover the helm as President and Group CEO and he has announcedplans to reorganize the Group into four main areas,namely CapitaLandSingapore,CapitaLand China,CMA and The Ascott
27、 Limited.WhileCMA and Ascott will maintain their global footprints,thorough reviewswill be conducted for the other geographical markets and businesseswith a view of exiting those deemed not scalable or if it unlocks valuefor shareholders.The largest business under review will be Australand,where man
28、agement sees its investment as a purely financial one.,Shares Issued(m):Market Cap(USD m):3-mth Avg Daily Turnover(USD m):ST Index:Free float(%):Major Shareholders:Temasek HoldingsKey IndicatorsROE(%)Net gearing(%)RNAV/shr(SGD):NAV/shr Sep 2012(SGD):Historical Chart,4,250.913,392.25.351.1CAPL SP Equ
29、ity,CMAs a growth leader.We expect the retail mall business underCapitaMalls Asia(CMA SP)to grow from strength to strength as Chinaprogresses towards being a consumption-led economy.Even though italready has 59 malls in China,we believe CMA is still actively on thelookout for more acquisition opport
30、unities.In the near term,we expectcapital recycling opportunities possibly from the divestment of its 50%stake in ION Orchard,as well as Queensbay Mall in Penang.Improved home sales in China.Following a year of improved homesales in China in 2012,CapitaLand has a pipeline of another 34,000units acro
31、ss China and we think demand will continue to beunderpinned by the urbanization process over the medium to long term.Under the new leadership,we expect China to remain a very importantmarket for the Group.Strength in diversity.We have a target price to SGD4.27 pegged at a20%discount to RNAV.Positive
32、 newsflows on take-up rates of itsresidential projects in Singapore and China will serve as positivecatalysts.Maintain BUY.,3.60CapitaLand Summary Earnings Table,3.203.002.802.602.402.202.00Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12Performance:,FYE Dec(SGD m)RevenueEBITDARecurring Net ProfitRecurring
33、 Basic EPS(cents)EPS growth(%)DPS(cents)PEREV/EBITDA(x)Div Yield(%)P/BV(x),2010A3,383.41,277.21,273.130.014.36.012.912.31.61.2,2011A3,019.61,279.91,057.324.9-17.08.015.514.02.11.1,2012F3,247.41,628.1823.519.4-22.16.019.912.11.61.1,2013F3,529.81,591.6827.919.50.56.019.811.81.61.0,2014F4,312.21,975.41
34、,213.528.646.66.013.59.31.61.0,52-week High/Low,SGD3.89/SGD2.224,Net Gearing(%)ROE(%),22.69.1,39.87.1,51.15.3,44.95.2,41.17.1,Absolute(%),1-mth4.9,3-mth21.3,6-mth29.9,1-yr70.9,YTD4.6,ROA(%)Consensus Net Profit(SGD m),4.0,3.0,2.2712.8,2.2817.2,3.1975.3,Relative(%),1.7,16.4,20.7,44.8,3.3,Source:Mayban
35、k KE,SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS,382.1,Property SectorFigure 1:CapitaLands asset allocation(excluding cash)as at 30 Sep 2012,Australia,16%,Europe&Others,3%Other Asia,10%,CapitaValue Homes,1%CapitaLand Commercial,0%Ascott,2%,CapitaLandFinancial,0%Surbana,1%Othe
36、rs,0%,China,38%,Capitaland China,CMA,13%,Hldgs,21%Singapore,32%Source:Company,Maybank KEFigure 2:CapitaLands RNAV breakdownMarket value(SGD m),Market value of local investment propertiesMarket value of China investment propertiesMarket value of other overseas investment propertiesNPV of development
37、profitsSingaporeChinaOthers,Stake,691.2554.61,322.91,781.3514.2,9 January 2013,CCT(pegged at Maybank KEs DDM target price of$1.35/share)CMA(pegged at Maybank KEs RNAV of$2.81/share)ARTAustralandLai FungFund management business(12x FY12 PER)Other net assets( equity of devt properties and net debt)RNA
38、VNumber of sharesRNAV/shareRNAV PremiumTarget PriceSource:Company,Maybank KE estimates,31.97%65.50%47.70%59.30%20.00%,1,226.27,148.7717.71,931.548.1432.55,957.222,708.44,250.6SGD 5.34(20%)SGD 4.27Page 5 of 22,Property Sector,PROFIT AND LOSS(SGD m),CASH FLOW(SGD m),FY Dec,2010A,2011A,2012F,2013F,2014
39、F,FY Dec,2010A,2011A,2012F,2013F,2014F,SalesCost of goods sold,3,383.41,945.7,3,019.61,946.7,3,247.42,192.0,3,529.82,389.6,4,312.22,919.4,Operating cash flowNet profit,902.21,273.1,-613.71,057.3,906.9823.5,1,958.9 1,382.4827.9 1,213.5,Gross profitOperating expensesOperating profitNet interestInteres
40、t incomeInterest expenseNet investment income/(loss),1,437.8228.81,208.9-448.20.0-448.20.0,1,072.9-137.01,209.9-472.80.0-472.80.0,1,055.4-508.71,564.1-579.728.0-607.60.0,1,140.1-391.61,531.7-553.228.7-581.90.0,1,392.8-526.61,919.4-576.228.0-604.20.0,Depreciation&amortisationChange in working capital
41、OthersInvestment cash flowNet capexChange in LT investmentChange in other assets,58.0141.5-435.4-1,816.8707.7-2,567.042.5,39.0-1,327.5-497.4-1,110.3-1,587.7272.5204.9,64.0-301.1241.2-1,961.5-758.7-1,770.0567.1,59.9605.6458.1-415.5-86.0-575.9246.4,56.0-262.3451.6-269.6-90.1-575.9396.5,Net other non-o
42、p.JV+Assoc.,876.6,876.6,329.2,368.9,490.9,Financing cash flow,-590.4,981.7,381.6,-1,400.8-1,245.7,Net extraordinariesPretax profitIncome taxesMinority interestsNet profitEBITDA,0.01,936.0265.9397.01,273.11,277.2,0.01,613.8190.9365.61,057.31,279.9,0.01,313.6205.4284.7823.51,628.1,0.01,347.4256.0263.5
43、827.91,591.6,0.01,834.1348.5272.11,213.51,975.4,Change in share capitalNet change in debtChange in other LT liab.Dividends paidNet cash flowFree cash flow,0.0188.9-227.6-551.7-1,505.0-957.1,2.81,771.5-326.7-402.4-742.3-1,928.9,1.31,312.1-591.7-340.0-673.1-1,621.8,0.0-571.9-573.9-255.0142.61,297.0,0.
44、0-344.0-646.7-255.0-132.9716.4,EPS(SG cts),30.0,24.9,19.4,19.5,28.6,BALANCE SHEET(SGD m),KEY RATIOS,FY Dec,2010A,2011A,2012F,2013F,2014F,FY Dec,2010A,2011A,2012F,2013F,2014F,Total assets,31,887.1,35,319.4,37,601.6,38,019.4,38,889.5,Growth(%YoY),Current assetsCash&ST investmentInventoriesDevelopment
45、propertiesOther assets,15,193.97,190.12,336.75,667.116,693.2,15,134.06,264.51,964.46,905.120,185.5,14,901.55,591.41,983.77,326.322,700.1,14,657.45,734.01,799.67,123.723,362.0,14,861.55,601.12,386.66,873.724,028.0,SalesOperating profitEBITDANet profitEPS,14.4-22.0-23.320.914.3,-10.80.10.2-17.0-17.0,7
46、.529.327.2-22.1-22.1,8.7-2.1-2.20.50.5,22.225.324.146.646.6,Investment properties,4,732.9,7,074.6,7,924.6,8,074.6,8,224.6,Profitability(%),LT investmentsNet fixed assetsOthersTotal liabilitiesCurrent liabilitiesAccounts payable,10,451.31,049.4459.617,855.24,308.32,050.1,11,576.61,075.5458.720,417.93
47、,571.82,270.5,13,346.6984.2444.722,130.33,546.51,722.6,13,922.5920.2444.721,975.23,544.71,938.6,14,498.5860.3444.721,886.94,055.92,043.6,Gross marginOperating marginEBITDA marginNet marginROAROE,42.535.737.737.64.09.1,35.540.142.435.03.07.1,32.548.250.125.42.25.3,32.343.445.123.52.25.2,32.344.545.82
48、8.13.17.1,ST borrowings,1,761.8,860.2,1,385.2,1,173.5,1,563.3,Stability,OthersLong-term liabilitiesLong-term debtsOthersShareholders equityPaid-in capitalReserveNet tangible assets,496.413,546.98,596.34,950.714,031.96,276.57,755.413,572.3,441.116,846.111,330.45,515.714,901.56,298.48,603.214,442.8,43
49、8.718,583.812,117.56,466.315,471.36,299.69,171.715,026.6,432.718,430.511,757.46,673.116,044.26,299.69,744.615,599.5,449.017,831.011,023.66,807.417,002.66,299.610,703.016,558.0,Gross debt/equity(%)Net debt/equity(%)Int.coverage(X)Int.&ST debt coverage(X)Cash flow int.coverage(X)Cash flow int.&ST debt
50、(X)Current ratio(X)Quick ratio(X),73.822.62.70.5-2.00.73.53.0,81.839.82.60.91.3-1.64.23.7,87.351.12.70.8-1.51.24.23.6,80.644.92.80.9-3.43.34.13.6,74.041.13.30.9-2.31.43.73.1,Net debt(S$m),3,168.0,5,926.2,7,911.3,7,196.8,6,985.8,Per share data(SG cts),EPSCFPSBVPSSPSEBITDA/shareDPS,30.021.2319.379.630
