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SP Setia at our re-entry levels: SP Setia share price has come off to our
recommended entry level of below M$4.00 on concerns regarding further
policy-tightening rounds in 2H11. Although such announcement may bring
about short-term weakness, we believe Setia’s long-term prospects remain
intact with strong earnings momentum, robust response to overseas portfolio,
and active involvement in NAV accretive projects. We close off our idea 'prefer
IJM Land over SP Setia' (+12.3% from 27 Jan-11) as we see good support for
the stock price around M$3.80 levels (historical mean 16% discount to RNAV
M$4.50). We expect SP Setia to outperform the Malaysia Property index in the
next 3-6 months.
Prefer APLN over CTRA: CTRA has rallied 50% YTD, whereas APLN has
dropped 7% YTD against a 20% YTD rise in the Indonesian Property Index.
We believe APLN’s 2Q11 results will act as a positive catalyst for the stock
with better-than-expected completions and over 70% of FY11E marketing sales
target already achieved. We expect APLN (14x FY11E P/E) to outperform
CTRA (28x FY11E P/E) in the near term based on relative valuations.
Prefer DLF over Godrej Properties (GPL): GPL has risen ~30% YTD,
whereas DLF has dropped 17% YTD. GPL is trading at 16x stabilized FCFE, a
60% premium to midcap real estate stocks, which in our view, is not justified. In
addition, we think DLF (25x FY11E P/E) looks attractive compared to GPL
(39x FY11E P/E) on a relative valuation basis. We believe DLF's debt reduction
initiatives will drive its stock price in the near term and expect GPL to
underperform DLF in the next 3-6 months.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
SP Setia at our re-entry levels: SP Setia share price has come off to our
recommended entry level of below M$4.00 on concerns regarding further
policy-tightening rounds in 2H11. Although such announcement may bring
about short-term weakness, we believe Setia’s long-term prospects remain
intact with strong earnings momentum, robust response to overseas portfolio,
and active involvement in NAV accretive projects. We close off our idea 'prefer
IJM Land over SP Setia' (+12.3% from 27 Jan-11) as we see good support for
the stock price around M$3.80 levels (historical mean 16% discount to RNAV
M$4.50). We expect SP Setia to outperform the Malaysia Property index in the
next 3-6 months.
Prefer APLN over CTRA: CTRA has rallied 50% YTD, whereas APLN has
dropped 7% YTD against a 20% YTD rise in the Indonesian Property Index.
We believe APLN’s 2Q11 results will act as a positive catalyst for the stock
with better-than-expected completions and over 70% of FY11E marketing sales
target already achieved. We expect APLN (14x FY11E P/E) to outperform
CTRA (28x FY11E P/E) in the near term based on relative valuations.
Prefer DLF over Godrej Properties (GPL): GPL has risen ~30% YTD,
whereas DLF has dropped 17% YTD. GPL is trading at 16x stabilized FCFE, a
60% premium to midcap real estate stocks, which in our view, is not justified. In
addition, we think DLF (25x FY11E P/E) looks attractive compared to GPL
(39x FY11E P/E) on a relative valuation basis. We believe DLF's debt reduction
initiatives will drive its stock price in the near term and expect GPL to
underperform DLF in the next 3-6 months.
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