Saturday, January 15, 2011

DBS Bank - Singapore Outlook 2011

DBS Bank - Singapore Outlook 2011 - 1

DBS Bank - Singapore Outlook 2011 - 2

Source/转贴/Extract/: youtude
Publish date:10/12/2010

《戰勝貪婪與恐懼 曾淵滄投資心理戰略》

Publish date:18/08/2008


Source/转贴/Extract/: youtube
Publish date:30/08/09

HwangDBS:Strategy & Stock Picks

Potential multi-baggers. Given the market’s low expectations, we see strong potential for MRT plays to outperform. There is deep value in under-researched property plays, especially existing owners of large prime land in KL City that are sure winners of the MRT. We see the MRT as a structural catalyst that could propel KL properties to greater heights.

Picking the winners. We have set the following criteria:
a) KL over Johor or Penang. KL has been under-invested in the past 12 years. Under the current Prime Minister, the government’s focus has been redirected back to KL via the Greater KL Plan (incorporating MRT). Execution risk is low as KL is already an established city run by the federal government, and the MRT is a high impact and high priority project under the Economic Transformation Program.

b) KL city over sub-urban. The MRT is aimed at improving the livability and vibrancy of KL, especially within the city. The massive RM43b MRT investment builds on the current city rail network to achieve better connectivity and integration.

c) High density over low density developments. Land suitable for high density developments can better leverage on increases in ASP, plot ratio/density, and commercial zoning, to achieve record profitability per acre.

d) Developers over asset owners, as developers have greater flexibility in integrating MRT into their plans. e) Existing large land owners, the sure winners. Large contiguous parcels of prime land in KL are scarce and highly sought after at premium prices.

f) Interchanges over single stops, given better connectivity, higher traffic potential and opportunity for high density mixed developments. In order to minimize execution risk, we prefer commercially-driven brownfield developments near existing lines/ prime areas that can capitalise on the MRT quickly.

Key interchanges with strongest upside potential (100- 500% appreciation in land values over next 3-5 years):
i) KLCC- Bukit Bintang (MRT Blue Line-MRT Circle Line- MRT Orange Line- LRT-Monorail);
ii) KL Sentral (MRT Blue Line-LRT-KTM-Monorail);
iii) Pusat Bandar Damansara – Damansara Heights (MRT Blue Line-MRT Circle Line);
iv) KL Eco-City- Midvalley (MRT Circle Line-LRT-KTM);
v) Sentul (MRT Circle Line-LRT-KTM).

Hence, the top beneficiaries of MRT will be existing owners of large undeveloped landbank near potential interchanges in KL City, that are earmarked for high density development i.e. the key hotspots mentioned above.

With this, our Top Picks (ranked by RNAV exposure to key hotspots) are:
a) YTL Land (Sentul, 66% of RNAV);
b) Selangor Properties (Pusat Bandar Damansara-Damansara Heights, 61% of RNAV);
c) Guocoland (Pusat Bandar Damansara, 51% of RNAV);
d) Bolton (KLCC, 28% of RNAV);
e) MRCB (KL Sentral, 20% of RNAV); and
f) SP Setia (KL Eco-City-Midvalley, 14% of RNAV).

These companies have strong/well-connected shareholders, and solid balance sheets and track record to bid for MRT interchanges to be integrated/located near their developments. They also stand a good chance of being roped in for government land redevelopment projects, and/or are potential M&A candidates given their attractive landbank and valuation.

We conservatively expect RNAV’s of our top picks to grow 6- 60% over the next 3-5 years, on the back of higher GDV and land values for key hotspots. In arriving at future RNAV (3-5 years forward), we imputed a 50% increase in GDV for ongoing/ launch-ready projects, and projected land prices based on average of current and 5-year forward land prices.


Sector ripe for re-rating. We believe the MRT could drive sector P/RNAV to beyond 2007-peaks (up to 1.25x for large caps; up to 1.0x for small-mid caps) vs current average of 0.7x. Similarly, sector P/BV could also re-rate to >1.4x vs 0.9x currently. We see the MRT as a structural catalyst that could propel Malaysian properties, especially in KL, to new heights. Previous re-ratings were on the back of positive government policy changes and robust property sales, which are also present now.

Raised target prices across the board:
- Big-cap beneficiaries (market cap >US$1b): Premium to RNAV. We raised TP for sector leader SP Setia to RM7.70 (based on 15% premium to RNAV vs 5% previously), in anticipation of potential landbank acquisitions and sector re-rating (SPSB’s KL Eco-City will be a beneficiary of the MRT). At 2007 peak, SP Setia traded up to 25% premium to RNAV.

- Mid-cap beneficiaries (market cap >US$250m): 0-10% discount to RNAV. We believe MRT beneficiaries such as YTL Land and Guocoland deserve to trade at par to RNAV. For Selangor Properties, our fair value is based on 10% discount to RNAV to factor in share illiquidity and slower launch momentum. We have also applied a 10% discount to RNAV for TA Global given its lower exposure to potential MRT interchange (13% of RNAV).

- Small-cap beneficiaries (market cap more then US$250m): 20-30% discount to RNAV. We applied 20% discount to RNAV for Wing Tai Malaysia and 30% discount for Bolton (less liquid). Hence, our TP for Wing Tai Malaysia is raised to RM3.00 from RM2.25, and Bolton’s to RM1.90 from RM1.50 (previously based on 30-40% discount to RNAV, as yet to factor in MRT as re-rating catalyst).

- Minimal beneficiaries of MRT: 20% discount to RNAV. For mid-cap developers with minimal exposure to the MRT, we applied 20% discount to RNAV e.g. E&O (TP raised to RM1.70 from RM1.40 which was based on 30% discount to RNAV). For Sunway City, the share price will likely be supported by Sunway newco’s RM5.10 general offer price.

- Asset owners: 20% discount to RNAV. Asset owners will likely benefit less from the MRT compared to developers, because the latter can incorporate MRT into their plans. Hence, for KLCC Property, we are retaining our Hold call and RM3.70 TP (based on 20% discount to RNAV).

Key Risks
Potential risks related to MRT:
a) Political risk. MRT will run across KL and Selangor, which is governed by the federal government and Opposition-led state government, respectively. As land remains a state matter, the state government may have a say in the alignment/ land acquisitions. In addition, the MRT will likely be fully funded by the public sector, which could mean more intense scrutiny by the Opposition and public. Nevertheless, the MRT is a high priority and high impact project that can create a huge multiplier effect on the economy. Public transportation system is a populist decision across political divide, and hence, should be well supported.

b) Availability of funding. There are concerns over how the government will fund the huge RM43b capex, given the current large budget deficit (5.4% of GDP). However, we believe funding should be a non-issue given savings from lower fuel subsidy (RM9bn p.a. for petrol, diesel and LPG) and availability of project financing (debt ring-financed to future cashflows). The government has minimal foreign debts currently, and the resultant higher budget deficit should be temporary as income should increase with the phased opening of the MRT. In order to be viable, the MRT has to pass through high volume and high commercial value areas. In addition, there may be contribution from the private sector as landlords bid for development rights to integrate MRT stations within their projects and/or jointly construct stations.

c) Construction delays. Construction for the MRT is expected to break-ground by Jul 2011, with the first contract targeted to be tendered out in 2Q11. But ultimately, timing will be dependent on: (i) confirmation of final alignment of the Blue Line (Sungai Buloh-Kajang) after taking into account feedback from all stakeholders; (ii) revision to the current National Land Code to facilitate land acquisition (but construction can still be carried out on piecemeal basis); and (iii) decision by the government on whether to invite foreign contractors to participate in some of the tenders. Acquiring land, especially those around matured corridors, may also be tricky and expensive. But this should be mitigated by the appointment of Gamuda-MMC as Project Delivery Partner, which role is to ensure the MRT project is completed on time and within budget.

c) Integration issues. The current public transportation suffers from: (i) poor connectivity between the various modes and limited interchanges; (ii) lack of support facilities e.g. feeder buses, car parks at stations, covered walkways; (iii) subsidised gasoline prices and availability of cheap open-air car parks in town that encourage city driving; and (iv) minimal integration with property developments along the line.

The MRT will look into addressing these ‘past mistakes’. The government has started to reduce fuel subsidies, and car parks will gradually be more scarce and expensive as more plots in town are developed. We do not discount the possibility of city toll collection (similar to Singapore’s ERP) and pedestrian-only streets being introduced to discourage city driving.

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11

HwangDBS: MRT Catalysts for key hotspots -Sentul

Key Hotspots -Sentul

Sentul is a 294-acre mixed development located <5km from KLCC and next to affluent Bukit Tunku/ Kenny Hills. It comprises Sentul East (108 acres, mainly commercial) and Sentul West (186 acres, residential), including Malaysia’s first private gated park (35 acres) and the KL Performing Arts Centre. The RM15b-GDV project is only 1/3-way through with 119 acres remaining.

Diamond in the rough. We expect Sentul’s land price to appreciate by 567% to RM1000psf in 5 years (CAGR of 46%), on the back of:

a) Potential major interchange with stop(s) on Circle Line. Sentul is already a multi-modal interchange for LRT and KTM. With the MRT, Sentul will turn into a major interchange with direct trains to KLCC on the Circle Line (just 3-4 stops away). This should significantly rerate property values in Sentul, which are currently transacting at RM500-550psf vs KLCC’s >RM1000psf.

b) High density mixed development. As a major interchange, Sentul should benefit from higher traffic, which encourages high density mixed developments. Sentul East currently has only two commercial developments i.e. D6 and D7 which are less than 10- storeys (remaining three plots yet to be developed).

c) On-going urban renewal. Sentul has the potential to be the next KL Sentral, which is a good case study of successful urban renewal for transportation hubs. Sentul’s developer - YTL Land (YTLL) - has a strong track record in urban rejuvenation i.e. Bukit Bintang, Pantai Dalam near Bangsar, Lake Fields@ Sungai Besi, and now Sentul. Land values at Sentul are currently at a depressed RM150psf vs KLCC’s RM2400psf (RM38psf ppr vs RM240psf ppr) which is just 10-15 minutes/ 3-4 MRT stops away.

d) Plot ratio revision. Under the Revised KL Draft Structure Plan, Sentul’s allowable plot ratio will be raised from 2.5x to 4x. This should increase net saleable area for Sentul West alone by 57% to 16m sf. Even at 4x, we believe Sentul has one of the lowest plot ratios in KL for high density developments. We do not discount the possibility of plot ratios being raised further (possibly to 6x) given: (i) Sentul is among the last large contiguous parcel of undeveloped land near KLCC (119 acres remaining); and (ii) strategic location just 10-15 minutes by car or 3-4 stops by MRT (direct train on the Circle Line) to KLCC.

Based on RMpsf ppr, expected growth should be a more modest 344% i.e. from RM38psf ppr to RM167psf ppr (5- year CAGR of 35%) – still a significant discount to KLCC’s RM500psf ppr and KL Sentral’s RM292psf ppr.

Land values should re-rate significantly. YTLL is targeting to gradually raise Sentul’s ASP to RM1000psf, starting with the launch of Capers @ Sentul East in 1Q11 at RM700psf. This more than doubles the launch price of RM300psf for Saffron in 2006 (secondary market RM500psf). We expect Capers to sell out given the large number of registrants (5000 for just 460 units) and YTL’s strong following. Based on 4x plot ratio, an ASP of RM700psf would imply RM500psf land value (assuming 25% pre-tax margin, gross construction cost of RM300psf). This is significantly higher than the current depressed asking price of RM150psf around Sentul. If ASP appreciates to RM1000psf, implied land value would be RM1000psf (assuming 20% increase in construction cost).

Largest landlord: YTL Land (YTLL). YTLL is the largest developer in Sentul with 119 acres of undeveloped landbank. Assuming RM1000psf ASP and 4x plot ratio, Sentul’s GDV is expected to leapfrog to RM15b vs RM8b previously. Over the next 18 months, YTLL plans to launch 4 projects at Sentul East (2 high-end condos + 2 commercial) with potential RM2b GDV. We believe the MRT will help to accelerate launches and boost demand for Sentul properties.

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11

HwangDBS: MRT Catalysts for key hotspots -KL Eco-City - Midvalley

Key Hotspots -KL Eco-City - Midvalley

KL Eco-City (KLEC) – Midvalley (MV) is located at the border of KL and Selangor (15 minutes from KLCC) and adjacent to affluent Bangsar. KLEC is a new RM6b mixed development spanning 24 acres across from MV, a successful 50-acre mixed development with 18m sf of retail space (including KL’s largest mall, Megamall & Gardens), office and hotel. Prized land becoming more valuable. Both KLEC and MV arose from the privatization of federal land by KL City Hall and are leasehold. For KLEC, we estimate land value at RM700psf based on KL City Hall’s entitlement to 20% of profits (as compensation for the land) and ~RM300m upfront cost to be paid by the developer for land premiums/infrastructure.

We expect KLEC’s land value to appreciate by 186% to RM2000psf in 5 years (CAGR of 23%), on the back of:

a) Potential multi-modal interchange on Circle Line. KLEC will likely have a stop on the Circle Line (direct train to KLCC), in addition to a new KTM and existing LRT stations (Midvalley has an existing KTM station as well). KLEC is the first to market itself as a transportation hub with a potential MRT station.

b) Early bird catches the worm. KLEC is the first project to integrate MRT into its masterplan (high density mixed development to leverage on high MRT traffic). KLEC is launching predominantly small built-up serviced apartments (650-850sf) and strata offices at RM1000- 12000psf, 30-40% premium to Midvalley and comparable to transportation hub KL Sentral. At RM12000psf and 8x plot ratio, implied land value is RM2400psf (assuming 25% pre-tax margin, RM450psf gross construction cost).

KLEC will be launched soon in 1Q11 – we understand boutique offices are already 75% sold (en-bloc), while demand for strata offices and serviced apartments is overwhelming.

c) Decentralised retail, office and hotel. MV is already an established sub-urban mixed development that welcomes 50k workers/residents and ~100k shoppers daily. KLEC will be connected to Midvalley via two proposed pedestrian bridges to tap on the latter’s strong visitor arrivals, while a two-tier road system for efficient traffic circulation and 4 major ingress/egress ramps linking to major roads will be constructed to manage traffic. KLEC should be able to hold its own given its strategic visibility from Federal Highway and Jalan Bangsar.

d) Redevelopment projects could re-rate surrounding land values. KLEC-MV is adjacent to the much sought-after Unilever land (former Unilever factory site with prime Jalan Bangsar frontage) and potential Media City (redevelopment of government land at Angkasapuri- Kerinchi-Pantai Dalam).

e) Plot ratio expansion. Under the Revised Draft KL Structure Plan, KLEC-MV’s plot ratios have been raised to 8x from 6x. KLEC is targeting 7.5m sf of gross floor area over 24 acres, implying 7.2x plot ratio (potential 11% increase in GFA to 8.4m sf if pushed to 8x).

On RMpsf ppr basis, expected growth should be a more modest 114% i.e. from RM117psf ppr to RM250psf ppr (5- year CAGR of 16%) – almost comparable to adjacent transportation hub KL Sentral’s estimated RM292psf ppr.

Largest landlord: SP Setia. KLEC is a new mixed development that is ready for launch soon, while MV is already at its tail end with only one office block left to be constructed (650k sf, RM450m GDV). We believe undeveloped land can better leverage on the MRT integration rather than existing assets, and developers will be able to price-in expectations of improved connectivity and high MRT traffic (for commercial properties). KLEC is jointly developed SP Setia (60%) and YGP Holdings Sdn Bhd (40%; controlled by UMNO Youth), with landowner DBKL entitled to 20% profit share as compensation for the land. Hence, SPSB’s effective stake works out to 48% but it maintains control of the project. MV is owned by IGB (holding company of Kris Assets, which owns Megamall directly).

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11

HwangDBS: MRT Catalysts for key hotspots - Pusat Bandar Damansara - Damansara Heights

Key Hotspots - Pusat Bandar Damansara - Damansara Heights

Pusat Bandar Damansara (PBD) – Damansara Heights (DH) is a much sought after freehold residential and commercial address located at the fringe of KL (<5km from city centre). Dubbed the Beverly Hills of KL, PBD-DH is home to KL’s rich and famous and is adjacent to other affluent enclaves i.e. Bukit Tunku and Bangsar. Starting off as an administrative centre in the 1980s (some of the government offices have since been relocated to Putrajaya), PBD-DH is now a major decentralized office hub for the private sector and MNCs.

Land much sought after. Average land values at PBH-DH had doubled to RM600psf over a short span of three years, notwithstanding the global financial crisis. E&O is targeting to launch The Peak bungalow lots in Damansara Heights soon at RM900psf (we understand most of the 12 plots have been booked). However, this still pales in comparison to KL Sentral’s >RM1500psf, due to lower plot ratios and largely residential zoning (set to change with MRT and Revised Draft KL Structure Plan).

We expect PBD-DH’s land values to rise by 233% to RM2000psf within 5 years (CAGR of 27%), driven by:

a) Potential MRT interchange. PBD-DH could be an early beneficiary of the MRT with a stop on the Blue Line. The Circle Line will also likely stop here, transforming PBD-DH into a major MRT interchange with a direct train to KLCC. Impact of the MRT may be significant, given PBD-DH is currently under-served by public transportation.

b) Opportunity for high-end high density mixed development. Potential MRT traffic, in addition to the existing affluent population and day office community, should make high-end high density mixed development more viable. Currently, there are only a handful of high density developments in PBD-DH and no retail mall. The development of high density mixed projects will be supported by higher allowable plot ratios (8x from 6x) and larger commercial zones under the Revised Draft KL Structure Plan.

c) Decentralised office hub. PBD-DH houses corporate offices for large MNCs such as Shell, Manulife, Siemens, and Hewlett Packard. The location remains popular due its strategic location and highway connectivity. Occupancy rate is a healthy 93%, while rental RM4-5psf (4-year CAGR of 10%).

d) Redevelopment of old commercial buildings. According to the Edge, Datuk Desmond Lim and Qatar Investment Authority have firmed up a deal with Johor Corp to buy the latter’s PBD landbank for ~RM700m. The JV might redevelop the existing government offices into the second Pavillion (after its successful mixed development project at Bukit Bintang), which should help boost PBDDH’s vibrancy. We do not discount the possibility of more such redevelopment projects in view of the MRT and higher allowable plot ratios.

On a RMpsf ppr basis, growth should be more modest at 150% i.e. from RM100psf ppr to RM250psf ppr (5-year CAGR of 20%). This will put PBD at a narrower 14% discount to adjacent transportation hub KL Sentral’s estimated RM292psf ppr.

Largest landlords: Selangor Properties (SPB), Guocoland. SPB owns 34 acres of undeveloped land in PBD-DH and 1.2m sf of office space. With the large strategic landbank and a strong balance sheet, SPB stands a good chance of bidding for the MRT interchange on/near its landbank. There could also be redevelopment potential for its existing office buildings (spanning another 12 acres in PBD-DH).

As for Guocoland, its RM2b Damansara City has been selected as one of the “Entry Point Projects” under the Economic Transformation Program which should help fast track approvals. The 8.5-acre mixed development is all set for launch in mid-2011 with sub-structure work substantially completed. It will comprise of two office towers (845k sf), a block of high-end serviced apartments (260 units), a five-star boutique hotel (300 rooms) to be managed by UK-based Thistle Group, and PBD-DH’s first retail mall (290k sf). ASP is ~RM1000psf, but could end up higher as the MRT interchange potential is priced in.

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11

HwangDBS: MRT Catalysts for key hotspots - KL Sentral

Key Hotspots - KL Sentral

KL Sentral is a RM14b commercial development located at the fringe of KL (10-15 minutes from KLCC). It will span 72 acres of freehold land with 21m sf of gross floor area upon completion in 2016. KL Sentral is a successful urban renewal story – from its humble beginning as part of Brickfields (KL’s Little India), KL Sentral is now a key transportation hub and decentralized office area.

Strong land price appreciation. Recent land transactions at KL Sentral fetched RM1900psf (implied price for 60% stake in Lot 348 from Gapurna) vs RM1100psf in 2005 (5-year CAGR of 12%), driven by higher plot ratios (16-17x vs 10x). KL Sentral is a good case study of how transportation hubs tend to enjoy stronger plot ratio expansion.

We expect KL Sentral’s land values to rise by 133% to RM3500psf within 5 years (CAGR of 18%), driven by:

a) Potential stop on MRT Blue Line. KL Sentral is already a multi-modal interchange for LRT, KTM, Monorail and ERL (direct 25-minute train to KL International Airport). A stop on the MRT Blue Line should enhance KL Sentral’s position as a key transportation hub, and higher traffic should encourage more high density mixed developments.

b) Potential KL-Singapore bullet train. The RM10b high impact project is currently being studied by the government. If it materializes, it will transform KL Sentral into a regional transportation hub and significantly re-rate land values, which are at a huge discount to Singapore just 90-minutes away (vs current 4-5 hours by road/air if we include airport journey and check-in time).

c) Decentralised office hub. KL Sentral appeals to corporations that want to set up offices near KL where good infrastructure and tax incentives (MSC Cybercentre status) are readily available. Shell will be relocating its corporate office here from Damansara Heights by 2012. Office rentals have doubled from RM4psf in 2004 to RM7-8psf (comparable to prime Grade A office space in KL CBD), while occupancy rates remain high at >90%.

d) Profile improving. The prestigious St Regis hotel/serviced apartments is expected to commence operations by 2013. International investors have already started to take notice of KL Sentral (CapitaLand, Kuwait Finance House, Japanese owner of KL Hilton and Le’Meridien Hotels).

We have assumed minimal plot ratio expansion since it is already relatively high for KL Sentral. Hence, growth on RMpsf ppr basis would be a similar 133% (5-year CAGR 18%) i.e. from RM125psf ppr to RM292psf ppr.

Largest landlord: MRCB. MRCB is the master developer of KL Sentral, having obtained the concession following the construction of a transportation terminal i.e. Plaza Sentral for the government. KL Sentral is at the tail-end of development with 12 acres left worth RM6b in GDV. We estimate KL Sentral constitutes 20% of MRCB’s RNAV. Other major landowners around KL Sentral include YTL Land (5 acres from parent YTL Corp following an asset injection exercise).

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11

HwangDBS: MRT Catalysts for key hotspots -KLCC - Bukit Bintang

Key Hotspots - KLCC - Bukit Bintang

KLCC is the established epicenter of KL, while Bukit Bintang (BB) is KL’s Orchard Road. The KLCC-BB stretch is popular among locals and tourists because of the iconic PETRONAS Twin Towers (third tallest building in the world), 50-acre urban park, and retail belt. KLCC-BB boasts of the top prime commercial properties in Malaysia, and commands premium rentals and capital values.

Land prices setting new benchmarks. Land transactions around KLCC-BB have picked up post-financial crisis, with valuations touching RM2400psf vs RM800psf in 2005 (5-year CAGR of 25%). Private and foreign direct investments are trickling back, mainly to commercial developments in KL CBD. We expect KLCC-BB’s land values to double to RM5000psf in 5 years (CAGR of 16%), on the back of:

a) Two potential MRT stops. KLCC-BB is earmarked to become a major interchange as BB will have a stop on the MRT Blue Line, and KLCC on the Circle Line, in addition to KLCC’s existing LRT and BB’s monorail stations. The MRT will help to improve KL’s livability and vibrancy, which should encourage city living.

b) Covered walkway. The government has allocated RM50m under Budget 2011 to build covered walkways in KL. The first between KLCC-BB (air-conditioned) will be completed in Oct 2011. This should boost KLCC-BB’s visitor arrivals and retail industry.

c) Rising tourist arrivals in Malaysia, with more intensive marketing & promotion activities, improved connectivity (budget airlines, potential KL-Singapore bullet train), and spillover benefits from Singapore. KLCC-BB is one of the most popular destinations in Malaysia.

d) Pick up in oil & gas sector. Increased domestic exploration and production activities augur well for KLCC as it creates new demand for prime office space. Most of the oil majors maintain offices in PETRONAS Twin Towers to be closer to PETRONAS and enjoy MSC-status benefits.

e) Potential incentives for KLIFD. KL International Financial District (KLIFD) is a 80-acre RM26b-GDV commercial project adjacent to Bukit Bintang, to be spearheaded by 1MDB and Abu-Dhabi based Mubadala Group. KLIFD is targeted at financial services companies, as the government awards more licences under the banking sector liberalization masterplan. The government announced in Budget 2011 that incentives might be introduced to attract investments to KLIFD (likely similar to Iskandar Malaysia e.g. tax breaks, speedy approvals, flexibility in sourcing for human resource and capital).

f) Plot ratio expansion. Under the Revised Draft KL Structure Plan, areas within KLCC with plot ratio of 10x will be further expanded (presently mainly 8x). This should encourage more high-end high-density developments. On RMpsf ppr basis, growth is expected to be more modest at 67% i.e. from RM300psf ppr to RM500psf ppr (5-year CAGR of 11%).

Landlords will be biggest beneficiaries. The largest landlord in KLCC is KLCC Holdings (wholly-owned subsidiary of PETRONAS), which has 8 parcels of land left around KLCC Park. KLCCH also owns KLCC Convention Centre and Impiana Hotel, and is the parent company of KLCC Property (largest commercial asset owner in KLCC). For BB, the largest landlord is YTL Corp (holding company of YTL Land, Starhill Global REIT, Starhill REIT). YTL Corp is in the process of injecting some of its prime KL landbank into YTL Land.

Based on RNAV exposure, developers that are most leveraged to KLCC-BB potential are:

a) Bolton (28% of RNAV);
b) Wing Tai Malaysia (22% of RNAV);
c) YTL Land (15% of RNAV); and
d) TA Global (13% of RNAV).

Guocoland’s Oval high-end condos in KLCC (25% of RNAV) should also benefit from higher ASP and stronger demand for properties adjacent to MRT interchanges.

ource/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11

HwangDBS: MRT Structural Catalyst for KL Real Estate

We see the MRT as a structural catalyst that could drive KL real estate to new heights, premised on the following:

a) Under-investment in KL in the past 12 years. The last major capex for KL were the PETRONAS Twin Towers and LRT system in 1998. Under current Prime Minister, Datuk Seri Najib Tun Razak, the government’s focus has been redirected back to KL via the Greater KL Plan that is aimed at improving the livability and vibrancy of KL. Execution risk is relatively low as KL is an established city and the MRT is a high priority high impact project under Malaysia’s Economic Transformation Program.

b) High multiplier effect on RM43b investment. The construction and operation of MRT is expected to create 130,000 jobs and boost gross national income by RM3- 4bn p.a. (2011-2020), with another RM8-12bn arising from the multiplier effect. Improved infrastructure and higher income should help to drive up property values (positively correlated to GDP growth).

c) Rising demand to live, work, learn & play ON the MRT coverage, would lead to opportunities for high density mixed developments, urban renewal, and new suburban townships. We expect city living to become more popular (vs sub-urban living currently), and provide 24/7 traffic to support more commercial activities.

d) Potential for record high profitability per acre from higher average selling prices, increase in plot ratios/density, and more commercial developments - leading to quantum leap in land prices.

Multi-year re-rating. With Cabinet approval in the bag and Gamuda-MMC appointed Project Delivery Partner (a.k.a. project manager) in mid-Dec10, the first MRT construction contract is expected to be tendered out as early as 2Q11. Construction may break-ground by Jul 2011, although timing is dependent on:

a) confirmation of final alignment of MRT Blue Line (Sungai Buloh- Kajang) after taking into account feedback from all stakeholders (targeting Apr-May 2011);

b) revision to current National Land Code to facilitate land acquisition; and

c) decision on whether to open up tenders to foreign construction companies. MRT Phase 1 (Blue Line) is expected to be completed by end- 2015 and integrated with existing LRT, KTM and monorail lines. MRT Phase 2, consisting of Circle Line around KL and Orange Line (KL-Klang), is slated for completion by 2020. Despite still a long way to go, property prices will likely move ahead as developers price in improved connectivity and commercial value.

Strongest re-rating for land near interchanges
While properties along MRT lines should appreciate across the board, the largest upside will likely be seen for large undeveloped landbank near interchanges with potential for high density development. With the Blue Line kicking off first under Phase 1, early beneficiaries will be landbank near multi-modal interchanges ON the Blue Line i.e.:

a) KLCC-Bukit Bintang (MRT-LRT-Monorail);
b) KL-Sentral (MRT-LRT-KTM-Monorail); and
c) Central Market (MRT-LRT); and
d) Maluri (MRT-LRT)

The Blue Line will pass through areas with high density and commercial values, such as Kota Damansara, Mutiara Damansara, Bandar Utama, Taman Tun Dr Ismail, Bukit Damansara, Pusat Bandar Damansara, KL Sentral, Bukit Bintang, Cheras and Bandar Tun Hussen Onn. These are matured areas that are currently under-served by public transportation.

For Phase 2, the biggest beneficiaries will be landbank near interchanges ON the Circle Line:

a) KLCC - Bukit Bintang (Blue Line–Circle Line-Orange Line– LRT–Monorail);
b) KLIFD (Blue Line–Circle Line–Orange Line);
c) Pusat Bandar Damansara - Damansara Heights (Blue Line–Circle Line);
d) RMAF@Sungai Besi (Circle Line–Orange Line-LRT);
e) University Malaya (Circle Line–Orange Line - LRT);
f) KL Eco-City – Midvalley (Circle Line-LRT-KTM); and
g) Sentul (Circle Line-LRT-KTM).

Of all the interchanges above, our top picks (ranked based on prime location and timing) are as follows:

1) KLCC – Bukit Bintang;
2) KL Sentral;
3) Pusat Bandar Damansara – Damansara Heights;
4) KL Eco-City – Midvalley; and
5) Sentul.

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11


Created 01/15/2011 - 17:44









Publish date:15/01/11

HwangDBS:Malaysia Property Entering a golden era

• MRT a structural catalyst to propel KL real estate to new heights
• Largest upside for landbank near interchanges that are earmarked for high density development
• Key hotspots: KLCC-Bukit Bintang, KL Sentral, Pusat Bandar Damansara, KL EcoCity-Midvalley & Sentul.
• Large landowners in KL City will be biggest winners: YTL Land, Selangor Properties, Guocoland, Bolton, SP Setia.

Multi-year re-rating. The MRT is expected to have a structural impact on KL real estate given: a) under-investment in KL since 1998 (focus is now redirected back to KL under current Prime Minister); b) high multiplier impact of RM43bn investment to improve city rail network for better connectivity and integration; c) emerging demand to live, work, learn & play ON the MRT line, leading to opportunities for high density mixed developments, urban renewal and new suburban townships; and d) potential for land prices to reach new highs with higher plot ratio/density and more commercial developments.

Quantum leap in land values. We expect land prices in key hotspots to surge by 100-500% over the next 5 years. Biggest beneficiaries of MRT will be land near/with potential interchanges i.e. KLCC-Bukit Bintang, KL Sentral, Pusat Bandar Damansara- Damansara Heights (PBD-DH), KL EcoCity-Midvalley (KLEC-MV) and Sentul, with biggest upside to be seen in emerging areas (Sentul, PBD-DH, KLEC-MV). To mitigate execution risks, we prefer commercially-driven brownfield developments near existing lines/ prime areas that can quickly capitalize on the MRT. Land values should also be driven by: a) higher plot ratios and wider commercial zoning under the Revised Draft KL Structure Plan (to be gazetted by 1Q11); b) government land redevelopment projects (potential re-rating of surrounding land values); and c) move towards open international land tenders.

Potential multi-baggers. Owners of large undeveloped land in/near the identified key hotspots in KL City that are earmarked for high density developments should be the biggest beneficiaries. Top picks (see Fig. 1): a) YTL Land, b) Selangor Properties, c) Guocoland, d) Bolton, e) MRCB, and f) SP Setia. We believe the MRT could drive sector valuation beyond 2007-peaks (large caps: up to 1.25x P/RNAV; small-mid caps: up to 1.0x P/RNAV). We initiative coverage of YTL Land with a BUY call and RM2.80 TP (based on RNAV), and raised TP for SP Setia to RM7.70 (from RM7.00) based on 15% premium to RNAV in anticipation of potential landbank acquisitions and sector rerating. We also raised Bolton’s TP to RM1.90 (from RM1.50), based on 30% discount to RNAV after factoring in contribution from Jalan Mayang JV (near KLCC).

Source/转贴/Extract/: HWANGDBS Vickers Research
Publish date:14/01/11


Created 01/15/2011 - 14:35












Publish date:15/01/11


Created 01/15/2011 - 14:36










大馬研究指出,種植領域雖交投踴躍,但盈利動力仍隨原棕油平均價上漲趨向強勁,建議持續“買進”I O I集團(IOICORP,1961,主板種植組)和吉隆坡甲洞(KLK,2445,主板種植組)。




Publish date:15/01/11


Created 01/15/2011 - 14:45




















Publish date:15/01/11

Singapore Press Holdings posts 29% fall in 1Q net profit to $102.3m

Singapore Press Holdings today reported net profit attributable to shareholders for the first quarter ended 30 November 2010 (1Q 2011) fell 29.3% y-o-y to $102.3 million.

Profit from the Newspaper and Magazine segment improved by 10.0%, driven by the increase in print advertisement revenue.

Group recurring earnings of $116.3 million fell by $43.0 million (27.0%) compared to the corresponding quarter last year which included $50.3 million profit from the Group’s completed property development project, Sky@eleven.

Group operating revenue at $318.7 million was 12.3% higher than that of 1Q 2010, excluding Sky@eleven revenue of $70.1 million in the comparative period last year.

The Newspaper and Magazine segment turned in a creditable performance with revenue for 1Q 2011 at $265.5 million, an increase of $9.2% against 1Q 2010. Print advertisement revenue grew 13.1% to $206.3 million driven by Display and Recruitment advertisements. Circulation revenue decreased 2.1% due to lower copies sold.

Rental income from Paragon increased 26.1% partly from rental revisions and increased floor area as a result of the façade enhancement Materials, consumables and broadcasting costs increased by 15.1%, as a result of higher newsprint and other production costs. Staff costs increased by $11.7 million 15.6% largely attributable to higher variable bonus provision and partial wage restorations.

Investment income of $6.1 million for 1Q 2011 comprised dividend and interest income and profit on sale of investments. The decrease of $4.1 million as compared to 1Q 2010 was mainly due to lower fair value gains.

On the outlook for FY 2011, Alan Chan, Chief Executive Officer of SPH, says: “The Singapore economy is expected to grow at a modest pace supported by sturdy regional demand and domestic activities. The Group’s advertisement revenue will continue to track the Singapore domestic economy. The opening of Clementi Mall marks a new milestone for the Group. Stores in the lower levels have commenced trading and full tenancy commitment is expected when the mall officially opens in April 2011.”

Barring unforeseen circumstances, the directors expect the recurring earnings of the media and property businesses for the current financial year to be satisfactory.

Publish date:14/01/11

嘉德置地建屋计划 不受新降温措施影响

嘉德置地建屋计划 不受新降温措施影响


  嘉德置地(CapitaLand)总裁廖文良,昨天在新加坡国立大学(NUS)房地产研究所(Institute of Real Estate Studies,简称IRES)讲座受询时透露,一切“照常营业”。




  因此,他对政府新出手“不会太不高兴(I am not too unhappy)。”


  他相信若情况逆转,政府也同样会采具前瞻性做法。他举例,亚洲金融风暴时,我国经济衰退,政府就推出了延迟付款配套(Deferred Payment Scheme,简称DPS)。


另一方面,原本预计在农历新年前推出大众化私宅项目Canberra Residences的中冶置地(MCC Land)发言人昨天受询时也指出,(与嘉德置地总裁廖文良)持同样的立场。

  发言人说:“公司会继续通过私下邀请潜在买家、收集支票等预售活动(soft launch)推出该私宅,不过正式推出恐怕要在农历新年以后。”


  益民林发展(EL Development)董事经理林有顺说,他目前正在思量新一轮降温措施对其公司打算在今年3月于马里士他路推出Skysuites 17的计划。



  嘉德置地第一季将推出经禧路(Cairnhill Road)一带的Urban Resort私人公寓;接下来照计划推出那森路的The Nassim(55个单位),也预定在第二季或第三季,推出勿洛市镇中心项目的私宅。

  嘉德置地先前透露,那森路一带的项目每平方英尺的价格将介于3500至3800元,The Nassim的尺价相信将破4000元;Urban Resort的尺价将超越3000元。

  中冶置业的大众化私宅项目Canberra Residences位于三巴旺/坎贝拉通道,是在去年6月以1亿3170万元(即容积率每平方英尺387元)通过政府售地计划标得,将兴建一个包含五层楼公寓的大众私宅。发展商当时把尺价预定在800元至1000元之间。

  该集团在去年11月推出执行共管公寓(Executive Condominium,简称EC)The Canopy,406个单位至今卖出了60%。发言人指出,在目前的大环境下,EC这类非投机的产物,价格比较韧性。




Source/转贴/Extract/: 《联合早报》
Publish date:15/01/11

Property market gets the chills

Property market gets the chills

Singapore government’s measures to curb property speculation sent shares of city-state’s biggest developers down the most in 11 months today.

The Straits Times Real Estate Index fell 0.3% at the close, with three stocks falling for every two that gained. CapitaLand, Southeast Asia’s biggest developer, fell 3.4% to $3.71, while City Developments, the second largest, declined 4.6% to $12.16, both retreating by the most since Feb 22.

The new cooling measures include extending the holding period of sellers stamp duty (SSD) from the current three years to four. The SSD has also been raised to 16%, 12%, 8% and 4% for properties that are bought after Jan 14 and sold within the first to fourth years respectively. This is payable regardless of whether the property is eventually sold at a gain or a loss. Also, unlike capital gains tax where sellers are taxed on their gains, the SSD is taxed on the full consideration of the property sold. This measure is therefore a significant deterrent for short-term speculators, research house Macquarie surmises.

Meanwhile, the loan-to-value (LTV) limit on housing loans for property purchasers who are not individuals will also be lowered to 50% while the LTV for individuals with one or more housing loans at the time of purchase will be lowered to 60%. The measures also take effect from Jan 14.

“The move, after the recent tightening in Aug 2010, is again targeted at dampening demand, while waiting for the supply side mechanism (increased public and private supply) to take effect,” write analysts from DBS Vickers in a Jan 14 note to investors.

Unit sales to fall
DBS expects the government’s latest moves to impact sentiment and trading activity in the property sector just as property stocks had made some positive progress in recent weeks. “We expect immediate drop in volume transactions,” the brokerage notes. “Hence, we believe primary sales projected for this year could tilt towards the lower end of our 10,000-12,000 units estimate,” says the research house.

Consequently, property stocks are expected to react negatively, particularly those with a higher exposure to the mass-market segment such as CityDev, with 29% of its gross asset value (GAV) exposed to the mass-market, as well as Wing Tai Holdings and Fraser and Neave, which have 15% and 5% of GAV in the low-end segment respectively.

Macquarie is also expecting a fall in unit transaction volume going forward. “We have already expected volumes to fall to 12,000 units this year from the historical high of more than 16,000 units sold last year,” it writes in a Jan 14 note to investors. “Our estimate for property prices is for a 7% rise this year. With these new measures, we suspect overall prices will be affected if the expected transaction volume decline is more protracted this round, which may force some developers to consider lowering selling price expectation to move their inventory.”

The one saving grace for local mass-market developers is their low level of gearing at about 36% which provides financial flexibility, Macquarie says. It believes Allgreen Properties will most likely be affected, given its high exposure to the Singapore residential market.

Meanwhile, Paul Lian of Goldman Sachs is expecting better returns from the luxury market, which it believes will be better insulated from the recent cooling policies. Lian favours UOL Group given the stock’s low exposure to the residential segment and good earnings visibility from unbilled sales. In the REIT sector, Lian’s top pick is CapitaCommercial Trust.

Go for office plays
For better gains in the property market, Brandon Lee of DMG & Partners is recommending stocks in the office sector. “We expect the healthy GDP growth and positive employment (particularly business and finance services) market to drive office demand,” he writes in his report. “Capital values will further expand, helped by improving appetites for office properties amidst a backdrop of low interest rate environment and rising rentals.”

This year, Lee is expecting a 12% y-o-y rise in Grade A properties to $2,750 psf, while Grade A rents should rise 20% from last year to $12 psf. Meanwhile, prime capital values should rise 3% to $2,150 psf, while prime rents will edge up slight to $9 psf, he believes.

Lee’s top picks in the office sector are Overseas Union Enterprise and Singapore Land, with valuations of $4.20 apiece and $9.50 apiece, respectively. Meanwhile, he has downgraded Keppel Land to neutral based on valuations, believing the stock offers limited upside from current levels. — Kang Wan Chern

Source/转贴/Extract/: The EDGE Weekend
Publish date:14/01/11

Is 2050 our next big target?

Saturday January 15, 2011

Is 2050 our next big target?


HSBC report projects Malaysia as a top-30 economy 40 years from now, but there are ifs and buts.

FORGET the Mayan prophecy that doomsday will occur on Dec 21 next year. Which would you rather pin your hopes on an ancient calendar of a collapsed civilisation or a recent 46-page economic report by an international bank? HSBC Bank plc issued the report, The World in 2050: Quantifying the Shift in the Global Economy, on Jan 4, and it's relevant to us here because Karen Ward, the bank's senior global economist and lead author of the report, seems pretty optimistic that Malaysia will fare well over the next four decades.

(By the way, the global head of economics at HSBC goes by the name of Stephen King. There may one day be a report from the bank that links the end of the world with spooky economic trends.)

According to the HSBC analysis, come 2050, Malaysia will be No. 20 among the world's top 30 economies, as ranked by the size of gross domestic product (GDP). That will mean climbing 17 rungs between now and 2050, the biggest jump recorded by any of these 30 countries. Thailand, the Netherlands, Switzerland, Hong Kong and South Africa are among those below Malaysia in the league table. Singapore will not even be in HSBC's top 30.

The main theme of the report is that the global economy is being transformed by the rapid growth of the emerging markets. Ward wrote: “By 2050, the collective size of the economies we currently deem emerging' will have increased five-fold and will be larger than the developed world. And 19 of the 30 largest economies will be from the emerging world. At the same time, there will be a marked decline in the economic might and potentially the political clout of many small population, ageing, rich economies in Europe.”

For example, HSBC reckons that China will be the largest economy in 2050 and India will occupy third place. Other than Malaysia, the emerging economies that will make significant headway in the world standings include Mexico, Turkey, Indonesia, Egypt, Thailand, Colombia and Venezuela.

Those who will lose a lot of ground are the ageing, rich European economies with small populations. Switzerland and the Netherlands will tumble down the table in 2050, while Sweden, Belgium, Austria, Norway and Denmark are not even in the bank's top-30 list.

It's nice to know that the HSBC report indicates a promising future for Malaysia, but it's essential that we have an idea of how the bank came up with the projections for total GDP. Basically, it begins by modelling income per capita and then incorporating the demographic outlook.

The first part is largely derived from the work of Robert Barro, an economics professor at Harvard University. To work out estimates of per capita income, the HSBC economics research team looked at key determinants of economic development in three areas economic governance (the degree of monetary stability, political rights and the level of democracy, the rule of law, the size of government), human capital (the level of education, health of the population and fertility rate) and the starting level of income per capita.

The idea is to establish how the economic conditions will affect how much an individual will be able to produce. HSBC has calculated that Malaysia's income per capita will grow by well over 500% between 2010 and 2050.

The next step is figure out the number of people being put to work across economies in the coming years. This is where demographics come into the picture.

“Differences in the demographics alone could explain as much as 2.5% points in GDP growth differentials in the coming decades,” says the report. A principal factor is the expected growth of each country's working population. HSBC relied on numbers from the United Nations. Malaysia is one of the countries that will see a strong expansion in their workforce, an increase of more than 40% from now until 2050.

The bank's research team combined the two sets of projections to get the total GDP growth rates over the next 40 years, and these in turn provide the size of the economies in 2050.

Of course, HSBC couldn't just lay out the figures and claim that all will be hunky-dory. The report has to address the worry that the planet may not have the capacity to sustain the fantastic growth in economic output by 2050.

Says the report: “The answer is a cautious yes. The world economy can triple its income, but only if levels of resource productivity are improved many times over.” That means there has to be major investment in efficiency and low-carbon alternatives. HSBC concedes that meeting food demand may be more challenging, but points out that improvements in yield and diet could fill the gap.

So, Malaysia still has a decent chance of making it to the top 30 by 2050, right?

We should take note that despite the amount of number-crunching and rationalising, the HSBC report is produced so as “to provide a framework for thinking” about issues related to the seismic shift in the global economy caused by the rapid growth of the emerging markets. We can remain hopeful, but let's not lose sight of the fact that an exercise like this comes with its fair share of ifs and buts. After all, HSBC is not in the business of making prophecies.

Says the report: “In a nutshell, our projections are based on a rather rosy backdrop everything is going right, governments and policymakers are doing the right thing.” In other words, things can go horribly wrong if the policymakers fail to make good decisions. We probably can learn that from the Mayans as well, can't we?

Deputy executive editor Errol Oh is fascinated with the many examples of the decline of great civilisations. Some of these have never been fully explained, but he believes the stock market is somehow at the centre of each case.

Source/转贴/Extract/: The Star Online
Publish date:15/01/11

谈经阁:肥年 vs 大鳄

2011/01/14 6:03:54 PM










Source/转贴/Extract/: 南洋商报
Publish date:14/01/11


January 14, 2011 22:15




08年政治海嘯淹沒馬股,于2天后(3月10日)宣告崩盤,富馬隆綜指盤中猛瀉138.86點或10.71%,更首度觸及自動停盤機制(circuit breaker),暫停交易1小時。















Publish date:14/01/11

Friday, January 14, 2011


Created 01/14/2011 - 18:35




“我們預見捷運將是引領吉隆坡產業走向另一高峰的結構性催化因素,主要是吉隆坡在過往12年投資落後,加上獲430億令吉投資改善城市鐵路網絡帶來高乘數效應(Multiplier Impact),以及捷運線工作、生活、學習和休閒需求增長,和潛在地價再創新高等因素支撐。”




當中,楊忠禮置地(YTLLAND, 2577, 主板產業組)、雪蘭莪實業(SPB, 1783, 主板產業組)、國浩置地(GUOCO, 1503, 主板產業組)、寶敦(BOLTON, 1538, 主板產業組)、馬資源(MRCB, 1651, 主板建筑組)和實達集團(SPSETIA, 8664, 主板產業組)等持有龐大吉隆坡市中心地庫的產業發展商將崛起成為大贏家。






● 政治風險


● 融資可得


● 工程展延


● 整合問題



Publish date:14/01/11


Created 01/14/2011 - 18:30



























Publish date:14/01/11

Phillip: Genting Singapore -Initiate coverage with a BUY at fair value estimate of S$2.74

Genting Singapore PLC
Buy (Initiation)
Closing Price SGD 2.19
Target Price SGD 2.74 (+25%)
52w k High (11/9/2010) 2.35 / 52w k Low (3/4/2010) 0.84

Genting Singapore PLC (“GIL”) is listed on the mainboard of the Singapore Stock Exchange and it is an investment holding company for Resorts World Singapore (RWS). Genting principal activities include casino operations, operation and management of integrated resort, international sales and marketing services as well as IT application related services. With the recent divestment of Genting UK, Genting Singapore derives 98% of its revenue from RWS. Initiate coverage with a BUY at fair value estimate of S$2.74

Investment Merits
With the opening of the integrated resorts, Singapore has seen significant increase in tourist arrivals, spending as well as length of stay. Genting has the advantage of having star attractions such as Universal Studios and Marine Life Park which attract non-gamers. For the gaming business, the casinos in Singapore have an advantageous footing since local gaming tax is only 5% for the VIPs and 15% for mass market gross gaming revenue. This means they have a shorter breakeven period versus casinos in other countries. Genting Group has gaming businesses entrenched in other parts of Asia, management is experienced and on home ground. We believe this gives them a competitive edge over their competitor. On a broader perspective, Singapore receives visitors from Indonesia, Malaysia and China, these Asia economies are bustling and economic conditions continue to be favourable for growth in 2011.

Investment Concerns
Leisure and entertainment revenues are generally cyclical in nature and we believe this sector is likely to be amongst the first to be impacted when there is contraction in discretionary spending. This means that the sector is investable only when the going is good. Another key concern reigning on our minds is the possibility that Genting’s share price may be negatively affected by poorer showing in 4Q10 results arising from writedowns due to the disposal of Genting UK. However, we believe any negative impact on share price due to the weak quarter is temporary as investors acknowledge the possibility of stronger earnings for the new financial year.

Future Outlook
Our outlook for the gaming sector is generally positive and we have forecasted stronger revenue growth in 2011. We believe better economic growth conditions, concerted efforts by the government to boost tourism figures and junkets operations are positive catalysts for Genting Singapore. Given our upbeat earnings forecast, we initiate a BUY on Genting Singapore with a fair value estimate of S$2.74.

Source/转贴/Extract/:Phillip Securities Research
Publish date:14/01/11

HLG: Possible hike in Airfares

Possible hike in Airfares

Possible hike in Airfares
 Local airlines may need to adjust air fares or fuel surcharges,
benchmarking on the decision of regional airlines, should the jet fuel
price continued to increase. (Star Biz)

 Comment: The increase in airfares and fuel surcharges is imminent for Airasia and MAS to maintain their profitability. Increasing jet fuel price will have higher impact on MAS due to its relatively higher percentage of fuel cost to total operating cost. Maintain Buy on Airasia with TP of RM3.46 and Hold on MAS with TP of RM2.27.

Source/转贴/Extract/: HLIB Research
Publish date:14/01/11

Airfares may go up

Friday January 14, 2011

Airfares may go up

Or airlines may increase fuel surcharge if oil price continues uptrend


PETALING JAYA: Local airlines may increase air fares or fuel surcharges should their regional peers do so as jet fuel prices continue to trend upwards.

As crude oil prices continued to trade above US$90 per barrel, aviation jet fuel price for this week was quoted at US$106.3 per barrel, based on the International Air Transport Association's website.

Avenues for airlines to contend with rising oil prices include increasing airfare, re-imposing or increasing fuel surcharge.

AirAsia X chief executive officer Azran Osman-Rani said the long-haul budget carrier would raise airfares if competing airlines operating similar AirAsia X routes did so.

“We will have to see how far (up) oil price goes, if like 2008 levels (which peaked at US$146), before we can make that decision,” Azran told StarBiz yesterday.

He added that AirAsia X did not have a targeted price increase and it was important for it to maintain its price differentiation in terms of keeping fares lower, compared with other airlines competing on similar routes.

“Our (A330) aircraft also has more seats, which means that the cost of fuel per passenger is lower than other aircraft,” he said.

Malaysia Airlines (MAS) managing director and chief executive officer Tengku Datuk Seri Azmil Zahruddin said fuel surcharge for its tickets was under constant review.

“In light of sustained increase of jet fuel prices in recent months, MAS is monitoring the situation closely. Any increase in fuel surcharge would be benchmarked against our competitors to ensure our fares remain competitive,” he told StarBiz.

An aviation analyst attached to a foreign research house said MAS might at increasing fuel surcharge, following Singapore Airline's (SIA) decision to do so last month.

SIA said in December that it was increasing its fuel surcharge, its first hike since June 2008, due to sustained escalation in the price of jet fuel in recent months.

Based on the airline's website, both SIA and its unit, SilkAir, would see fuel surcharge increase between US$3 and US$25 per sector, depending on the distance and class of travel.

AirAsia group chief executive officer Datuk Seri Tony Fernandes said that the airline was not looking to impose a fuel surcharge or increase air fares at the moment.

“We will continue to monitor oil prices and make a decision when the need arises,” he said.

Meanwhile, a local aviation analyst said low-cost carriers were unlikely to impose a fuel surcharge unless oil prices exceeded US$100 per barrel.

“There has been no indication by the (local) airlines that they are putting on a fuel surcharge. I don't see oil prices exceeding US$100 per barrel as the current rise in oil price is not so much demand driven but more a flow of liquidity due to the quantitative easing measures, where money is flowing into commodities,” he said.

The analyst added that such a concern on fuel surcharge would only arise should oil prices exceed US$100 per barrel for two to three continuous weeks.

The Associated Press reported on Tuesday that some US airlines had started to raise air fares with a Southwest Airlines spokesman attributing the air fare increase to contend with rising fuel costs.

The news report also said the increase on many US domestic routes ranged from US$4 to US$10 per round-trip ticket, depending on the length of the flight.

Low-cost carrier AirAsia scrapped its fuel surcharge in November 2008.The airline tackles fuel price hike with aggressive marketing and the strengthening of its ancillary business instead of relying on fuel surcharge to offset rising fuel cost.

AirAsia group chief executive officer Datuk Seri Tony Fernandes said that the airline was not looking to impose a fuel surcharge or increase air fares at the moment.

“We will continue to monitor oil prices and make a decision when the need arises,” he said.

Source/转贴/Extract/: The Star Online
Publish date:14/01/11

Ringgit likely to trend higher on tightening policy

Friday January 14, 2011

Ringgit likely to trend higher on tightening policy


PETALING JAYA: The ringgit and regional currencies will trend higher this year as governments weigh in on inflation versus the need for economic growth.

Economists have pointed out that the US dollar outlook for the year would be affected by the second round of quantitative easing announced last November as well as the economic prospects.

The ringgit yesterday hit a fresh high of 3.053 to the US dollar in morning trade before settling at 3.054, on expectations of a hike in the overnight policy rate (OPR), currently at 2.75%.

This outlook was heightened on the expection for higher inflation, as subsidies for fuel were reduced and food prices rose.

The greenback has also weakened against the yuan, falling by more than 0.40% this week after a 0.58% drop last week. This followed an interest rate hike by the People's Bank of China on Oct 19 on mounting inflation, which hit 5.1% in November compared with a year ago.

Currency traders told StarBiz that the outlook for the ringgit continued to be bullish in tandem with that of regional currencies especially with the unexpected 25-basis-point rate hike by the Bank of Korea and Thailand's 25-basis-point hike on Wednesday.

EON Bank Bhd currency trader D. Sivadass said the ringgit would strengthen in tandem with currencies in the region as governments focused on inflation brought on by higher commodity prices and funds flow as a result of tightening monetary policy.

Although he does not expect a hike in the OPR when the monetary policy committee meets on Jan 27, the argument for rate hikes has strengthened for Malaysia as well as the region's economies.

“While inflation is under control for the moment, overall interest rates are pointing up,” Sivadass said.

He said the ringgit would trade around the 3.05 level for the week and 3.03 next week, assuming current conditions remained the same.

AmResearch Sdn Bhd senior economist Manokaran Mottain said going by Bank Negara's recent statements, the current monetary policy would likely to be more focused on inflation than growth.

“Demand is now supporting growth with the economy expected to expand by 6% in the second half of the year, fuelled by projects under the Economic Transformation Programme,” he said.

However, Manokaran noted that along with the region, inflationary pressure had stepped up; therefore managing inflation would be the focus in the coming months.

He said the statutory reserve requirement (SRR), which is the amount of funds banks must set aside with the central bank against deposits and notes, could be looked into during the Jan 27 meeting.

“The SRR has been on the low side,” he said. In late November 2008, Bank Negara reduced the SRR by 50 basis points to 3.5% in response to the need to boost liquidity during the recession.

Nevertheless, Manokaran expects at least 50 basis points of OPR hikes this year with inflation at 3% by end-2011.

“I expect the ringgit to peak at 2.92 to the US dollar before coming down to 2.95 to 2.97 by year-end,” he said.

Meanwhile, OSK Investment Bank Bhd currency trader Godwin Chan said there could be an interest rate hike this month due to the inflation outlook.

“The likelihood of a rate hike is higher now and that will affect the US dollar/ringgit outlook, which will be bearish,” he said.

Chan expects the ringgit to trade against the greenback between 3.02 and 3.03 and maintained a 2.90-3.00 target to the end of the year.

“This level will reflect the true fundamentals of the currency,” he added.

Source/转贴/Extract/: The Star Online
Publish date:14/01/11

CIMB: Capitaland – BUY

Capitaland (CAPL SP; S$3.84) – BUY
FY11P/E: 20.6x, P/BV: 1.1x

Capitaland (CAPL SP; S$3.84) – BUY
FY11P/E: 20.6x, P/BV: 1.1x
• The stock appears to be stuck in a long term triangle pattern. Prices are now
trading above its moving averages and look poised for a test of its triangle

• Coupled with positive looking momentum indicators, we think prices could
soon move higher from here. Its 30-day is about to cross positive over its 50-
day SMA and when that happens, we could see another round of buying set in.
• Traders can buy now with a tight stop placed below the recent swing low of
S$3.78. One can also place a stop below S$3.61. Prices could soon test the
S$4.16 levels, where its triangle resistance currently lie.

Source/转贴/Extract/: CIMB Research
Publish date:14/01/11

High-end condos in hot demand in M'sia: DTZ

05:55 AM Jan 14, 2011
SINGAPORE - Malaysia's residential market continues to see active new launches and previews of high-end condominiums in the established neighbourhoods of Kuala Lumpur City Centre, Jalan Ampang and U Thant, DTZ Research said in a report.

Despite the year-end, the market for new launches of prime condominiums remained active, with developers focusing on smaller units. Encouraging take-up rates were noted in the few new high-end launches such as M-Suites, Vipod and Quartro, clearly indicating that buying sentiment remains positive, the report said.

Overall, the average price of high-end condominiums in Kuala Lumpur was stable, with a marginal decline of around 0.17 per cent on-quarter to RM599 ($252) per sq ft in the fourth quarter of last year, while average rents declined 2 per cent from the previous quarter to RM3.58 psf per month.

Mr Eddy Wong, head of residential marketing at DTZ, said: "With the new measure implemented by Bank Negara Malaysia in November, which reduces the loan-to-value for the third residential property purchase to 70 per cent, the market may see a short-term pullback from investors. However, the prospects for 2011 remain positive as the economy is expected to grow sustainably."

The real estate investment market saw a 90-per-cent on-quarter decrease in the total value of investment transactions due to the absence of major Reit listings compared to the previous quarter. The total investment transaction for the quarter was about RM731 million, involving some 12 assets.

The outlook for 2011 is likely to be moderate as GDP is forecast to slow down to about 5 per cent, and external uncertainties posing new challenges in terms of stronger exchange rates, higher inflation and interest rates. The new investments under the Economic Transformation Plan will also drive growth in disposable income, DTZ said.

Publish date:14/01/11

A clear message the Government will not be messed with

by Colin Tan
05:55 AM Jan 14, 2011
Upon first reading, the latest set of cooling measures looked pretty harsh but a second reading shows that the new rules are actually quite focused on which group of buyers it wants to discourage that is, speculators and short-term investors. Even here, we have to understand what is actually happening in the market before we can say for sure whether the impact on this group of buyers is significant.

The sharp hike in sellers' stamp duty for any resale within four years of purchase is pretty drastic. This will significantly increase transaction costs and lower the profits of investors. This will in turn lower the attractiveness of properties as an investment asset.

However, how much of an impact this measure will have on the market will depend on how much re-selling actually occurs in the market within four years of purchase. The current statistics appear to show that the volume of subsales is not a big problem and has actually been decreasing over the past year.

The 50 per cent loan-to-value ratio for non-individual buyers also looks like it will hit the market hard. However, if the banks and finance companies are already voluntarily capping loans at 50 per cent for such buyers, then once again, the impact is minimal.

The reduction in loan-to-value ratio from 70 per cent to 60 per cent for individuals with one or more outstanding mortgages appears to be the easiest to analyse. Those buyers at the margin will be the hardest hit. Do expect another round of vocal protests in the media. However, more importantly, the proportion that needs to be paid in cash has been left untouched at 10 per cent.

You then have to ask which is the greater hurdle for such buyers? I suspect it is the cash component which means the impact is mitigated somewhat.

Is this new set of measures a case of the bark being worse than its bite?

Notwithstanding the actual impact of the measures, I expect a knee-jerk reaction from the market.

We can expect developers to hold back their launches as they wait for potential buyers to digest the news. The overall sales volume will drop sharply.

With much fewer launches, the price index will be strongly influenced by what happens in the secondary market. Whether prices correct or not will depend on whether there is any panic selling. The more likely response I feel is that most sellers will wait and see which means prices will be flat.

The strongest impact of the new set of measures is in its timing. Lately, some investors are even doubting whether the Government has the gumption to act tough. Certainly, many had not expected a reaction so soon after the Aug 30 announcement. After all, the flash estimates have shown that the pace of price increases have slowed.

That the authorities have acted so quickly when it needed to should send short-term investors a clear message it will not be messed with and that the market will certainly not be allowed to overheat.

Colin Tan is the head of Research & Consultancy at Chesterton Suntec International.

Publish date:14/01/11

New home loans and property launches to be hit

by Chris Howells
05:55 AM Jan 14, 2011
SINGAPORE - A knee-jerk reaction to the latest round of property cooling measures is expected to hit banks and developers but industry players believe that normal service will resume.

For now though, banks here are likely to see a dip in new housing loan applications, while developers may postpone new launches.

Commenting on the latest measures, the Real Estate Developers' Association of Singapore (REDAS) said it expects these measures to discourage speculative demand but remains confident that the local "property market will continue to be underpinned by sound economic fundamentals and a favourable business environment".

Still, analysts expect developers to hold back on new launches.

Referring to the last round of cooling measures, which were rolled out on Aug 30 last year, Credo Real Estate managing director Karamjit Singh noted that, this time around, developers would also "hold back temporarily, as they assess demand and sentiment before launching their projects".

As a result, sales volumes would drop in the short term, he said.

Describing the latest measures as "a fourth and more decisive wave of prudential curbs", Barclays Capital economist Wai Ho Leong said any impact on prices may only be gradual.

Said Mr Leong: "We maintain that the risks for property prices and rents over the next four years are to the downside. Even so, the downward correction will occur gradually, given that Singapore is in the midst of a strong cycle of wealth creation, which has been fuelled by a surge in inward migration and rising asset values."

The cooling measures come at a time when home buyers have been keen to leverage on the low interest rates - and a fall in demand for mortgage loans could put further pressure on the profitability of banks here.

OCBC Bank head of consumer secured lending Phang Lah Hwa said: "The new property measures will have an impact on new housing loan applications, as we expect potential home buyers to be more cautious and will take their time to review their options."

Ms Lui Su Kian, DBS Bank's senior vice-president and head of deposits and secured lending, noted that the measures would mean investors would have to commit higher cash amount for their downpayments.

But with the Chinese New Year - traditionally a quiet period for the property market - around the corner, Ms Lui noted that it would take some time before the impact could be ascertained.

RBS head of South East Asian equity research Trevor Kalcic said: "There is very likely to be a slightly negative impact on the banks ... but it won't be a material impact. The reason is that mortgages are a relatively small component of overall earnings."

Publish date:14/01/11

New cooling measures but ...

They are by no means the last should they fail to curb property market: Analysts
by Esther Ng and Cheow Xin Yi
05:55 AM Jan 14, 2011

SINGAPORE - More restrictions to curb the sizzling property market were unveiled yesterday by the Government, five months after its last round of measures and its fourth in 16 months.

And these latest cooling measures - described by some industry players as "too punitive" - are by no means the last should they fail to tame the market, analysts said.

Research Consultancy SLP International executive director Nicholas Mak said: "This is going to basically drive another nail into the coffin of anybody who has thoughts of short-term investments."

Ms Tessa Chan, in her 30s, told MediaCorp the latest measures have put the brakes on her plans to own a second property.

She said: "Those who have already benefitted (from the high property prices) ... will have another bite at the cherry because they're already sitting on cash waiting. But, for those are coming into the party late, too bad."

Like the previous Government interventions, the four tools announced yesterday after the stock market closed - and which take effect today - were aimed at discouraging short-term investment and to soak up excessive liquidity sloshing around.

They came only a few hours after buyers snapped up all the units available at the Loft@Holland (picture), Oxley Holdings' latest "shoebox'' residential project.

And such signs of froth in the market could be removed for at least two to three months, property analysts predicted.

The timing of the announcement - days before December home sale figures will be released - suggests that the Government may be concerned about the property prices seen between September and last month, according to Cushman & Wakefield managing director Donald Han.

While prices seem to have stabilised compared to the first half of last year, a rise in sales volumes, as seen in November, would have an upward effect on prices, said Mr Han, who suspects that there was also an aggressive take-up in December.

Mr Mak said that his firm's research showed that subsales, as a percentage of total residential transactions, have been falling since the second quarter of 2009, from 14 per cent then to 9 per cent most recently.

"Since short-term property speculation is not at a problematic level, the latest round of Government intervention could be prompted by other factors, such as strong demand for residential properties due to high level of liquidity," he said.

For those who are looking to flip property for a quick buck, however, Mr Mak said they may be deterred by the move to increase the duration, from the current three years to four years, in which the Seller's Stamp Duty applies.

It could force some buyers of uncompleted homes to hold on to those properties until they are completed and, for completed properties, to lease them until the end of the four-year period.

Mr Mak added: "The duty rate of 16 per cent and 12 per cent for residential properties which are bought and sold in the first and second year respectively would almost cream off the profit made from such short-term investments."

But not everyone could be out to make a fast buck. International Property Advisor director Ku Swee Yong said there may be "hardship cases", where someone sells a condo "to save his business from bankruptcy or for (treating) a brain tumour".

First-time buyers of private residential properties have less to worry as they would not bear the brunt of the latest measures.

For instance, lowering the limit on housing loans, from 70 per cent to 60 per cent of valuation for individuals with one or more outstanding housing loans at the time of the new housing purchase, will not affect new home buyers, said Mr Han.

Instead, it will "take some wind out of the mass market - properties below $2,000 per square foot - and mass market buyers trying to get their second or third property".

The new measures
by Esther Ng
- Holding period for imposition of Seller's Stamp Duty (SSD) increased from three to four years.

- SSD rates raised to 16 per cent, 12 per cent, 8 per cent and 4 per cent for homes bought today and thereafter and which are sold in the first, second, third and fourth year, respectively.

- Loan-To-Value (LTV) limit lowered to 50% on housing loans for property purchasers who are not individuals.

- LTV limit lowered from 70 per cent to 60 per cent for individual property purchasers with one or more outstanding housing loans.

Publish date:14/01/11

Sluggish outlook for property investment trusts

Sluggish outlook for property investment trusts
By Sharen Kaur

Prospects for real estate investment trusts (REITs) are sluggish as there are fewer Grade A office buildings for sale in Greater Kuala Lumpur.
As such, Rahim & Co managing director Robert Ang reckons there will be fewer REIT launches this year.

"REITs look at investments of above RM100 million. However, there is no good stock in the market. If there are quality assets, most developers will hang on to them as an investment, and probably float their own REITS," Ang said.

"What you have in the market now are assets for sale by trust funds who are cashing out," he said after a briefing on the Malaysian property market outlook in 2011 in Kuala Lumpur yesterday.

Ang said developers may take up property investment as a side income because of scarce land for new projects.

Nevertheless, he expects more launches this year compared with 2010, with prices for landed residential properties increasing by 5 per cent to 10 per cent in choice locations.

But he cautioned that ordinary investors are staying out of the market.

"Fundamentals are not strong for foreign investors to come here. There is oversupply of condominiums in Kuala Lumpur. The vacancy rate is 30 per cent and rentals are softening. I do not foresee a major price increase for the next one to two years," he said.

Ang said developers are still launching condominiums in Kuala Lumpur despite an oversupply situation and sales have been brisk as prices are 20 per cent less from the peak.

Meanwhile, Rahim & Co founder and executive chairman Datuk Abdul Rahim Rahman said the Malaysian property market will do better this year, led by projects under the Economic Transformation Programme.

Abdul Rahim expects more demand for residential, commercial, industrial and retail properties.

He said projects like the Sg Buloh land and Sg Besi airport redevelopment, the Matrade project by Naza Group, the Kuala Lumpur International Financial District and the 100-storey tower by Permodalan Nasional Bhd will contribute to growth in the property sector over the next few years.

"There would not be a nationwide phenomenon of property bubble," he said.

Publish date:14/01/11

Phillip: Investment Outlook 2011

Source/转贴/Extract/: youtube
Publish date:14/01/11

Thursday, January 13, 2011

Singapore imposes more housing curbs as prices rise to record

Singapore will raise down payments for second mortgages and extend holding periods for properties starting tomorrow after home prices rose to a record last quarter, intensifying the nation’s efforts to curb speculation.

Individuals who hold more than one mortgage can only borrow up to 60% of a property’s value, versus 70% previously, the government said in a statement today, while loans to entities other individuals will be cut to 50% from 60%. A seller’s stamp duty will apply to all residential units and land sold within four years of purchase, from three years now.
Singapore’s private home prices climbed to a record as the nation’s fastest economic growth since independence in 1965 countered government measures to cool the market. The city-state has been attempting to rein in home prices since 2009 when the government barred interest-only loans for some housing projects and stopped allowing developers to absorb interest payments for apartments still being built.

“Previous government measures have to some extent moderated the market, but sentiments remain buoyant,” according to the statement today. “The government has decided to introduce additional targeted measures to cool the property market and encourage greater financial prudence.”

Asia’s Curbs
With the additional measures, Singapore joins markets across Asia have added measures to curb property speculation driven by low interest rates. Hong Kong imposed additional taxes and higher down payments in November after home prices climbed more than 50% since the beginning of 2009. China, battling 18 months of price increases, also introduced restrictions on second mortgages and raised interest rates for the first time in three years.

Singapore’s homeowners who sell a property within a year of purchase will have to pay a tax of 16% from 3% now. That drops to 12% in the second year, 8% in the third, and 4% in the final year of the restricted period. The government also said it will take further steps if necessary.

“The seller’s stamp duty rates will be increased sharply so as to provide a strong disincentive for investors looking to make short term gains,” the government said. “The impact of the seller’s stamp duty is especially significant as it is payable regardless whether the property is eventually sold at a gain or loss.”

Singapore in February last year said it will levy a seller’s stamp duty on all residential properties and land that are sold within one year from the date of purchase. That was increased to three years in August, when the government also raised down payments for second mortgages.

More Deals
Private residential sales in November rose the most in seven months. Property transactions reached an unprecedented level in the first 11 months of 2010 as developers sold 15,025 properties, according to preliminary data from the government. That exceeded the high of 14,811 homes in 2007.

“December sales would be as aggressive as the November numbers,” said Donald Han, the Singapore-based managing director at Cushman & Wakefield, the world’s largest closely held real estate services company. “The tide is coming onto the shores of places like Singapore, China and Hong Kong, and it’s hard to stop the tide with low interest rates. The only way is to pump in regular measures like what we’ve seen.”

Record-Low Rates
Singapore’s three-month interbank rate fell to 0.43751% on Jan. 3, the lowest since Bloomberg began compiling the data in 1999. It was at 0.43779% today.

The Monetary Authority of Singapore in November said low borrowing costs and excess liquidity globally may push the island’s property prices higher again. There is a risk that financial institutions may ease lending standards and extend more loans to make up for narrowing interest margins, while buyers may also take on “excessive leverage” amid expectations of a sustained period of low rates, the central bank said.

“Low interest rates plus excessive liquidity in the financial system, both in Singapore and globally, could cause prices to rise beyond sustainable levels based on economic fundamentals,” according to today’s statement. “The government’s objective is to ensure a stable and sustainable property market where prices move in line with economic fundamentals.”

Publish date:13/01/11

Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)

乔治·索罗斯(George Soros)



高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo

There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock