CAPITALAND | NEUTRAL
TARGET PRICE: $3.84
MARCH 27 CLOSE: $3.64
RHB RESEARCH, MARCH 27
Media sources have reported that CapitaLand is currently in exclusive negotiations to acquire Asia Square Tower 2 from Blackrock.
We expect the pricing to be in the range of $2.1-2.3 billion, assuming $2,700-2,900 psf for the transaction. The deal, if concluded, would strengthen its recurring income base.
Sales in Singapore launches have picked up post increased marketing efforts, but the residential segment in China is likely to see a slowdown from recent policy changes. Maintain "neutral" with revised TP of $3.84 (from $3.60, 4 per cent upside).
BOUSTEAD PROJECTS LTD | ADD (INITIATION)
TARGET PRICE: $1.04
MARCH 27 CLOSE: $0.825
CIMB RESEARCH, MARCH 24
Boustead Projects (BP) is a reputable high-spec facilities designer and builder behind big names such as Rolls Royce, Airbus, Applied Materials and GSK.
It also has a portfolio of 18 leasehold facilities to counter construction cyclicality, generating about $20 million operating cashflow per annum or about 60 per cent of group's Ebitda.
Asset size (including projects under development) is on track to hit its targeted critical mass for a Reit listing potentially by FY20-21F year-end, based on our estimate.
COMFORTDELGRO | BUY
TARGET PRICE: $2.95
MARCH 27 CLOSE: $2.49
OCBC INVESTMENT RESEARCH, MARCH 27
After numerous taxi companies, including ComfortDelGro (CDG), earlier this year submitted plans to the Public Transport Council (PTC) as they seek to introduce dynamic pricing of taxi fares (i.e. flat fee structure with no surcharges that is similar to the private hire cars' fare structure), PTC and Singapore's Land Transport Authority (LTA) on March 17 gave the green light as they said they have no objections to the proposals submitted.
In our view, the move by five other taxi companies operating more than 10,600 taxis in total to partner Grab to offer dynamic pricing fare option through the new JustGrab function in the Grab mobile app will greatly dilute the market for GrabCar drivers.
We believe this move will further level the playing field between taxi companies and private hire car service providers.
Therefore, as we expect increase in dividend yield over time as CDG receives cash from the sale of bus assets to LTA, reiterate "buy" on CDG with an unchanged FV of $2.95.
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