Stock Name: OUE Ltd
Company Name: OVERSEAS UNION ENTERPRISE LTD
Credit Suisse in an Aug 17 research report says: "OUE share price has underperformed even its office peers, as it fell 14% since Aug 5, and is back to Mar 2010 levels when prime Grade A office rents bottomed and which have since recovered 31%.
"It is now trading at a 50% discount to our RNAV of $4.67, the steepest discount in our coverage universe. While leasing risks have increased on its One Raffles Place Tower 2, which is still not pre-committed ahead of its target completion in 4Q11, we estimate it only makes up 6% of its RNAV.
"Its OUE Bayfront is already 77% committed and achieving latest rents of $13/sqft. Our sensitivity test shows that even if property prices/rents across all segments fall 20%, its RNAV will fall to $3.28, still a 40% upside to the current stock price. MAINTAIN OUTPERFORM."
Company Name: OVERSEAS UNION ENTERPRISE LTD
| Research House: Credit Suisse | Price Call: BUY | Target Price: 3.28 |
Credit Suisse in an Aug 17 research report says: "OUE share price has underperformed even its office peers, as it fell 14% since Aug 5, and is back to Mar 2010 levels when prime Grade A office rents bottomed and which have since recovered 31%.
"It is now trading at a 50% discount to our RNAV of $4.67, the steepest discount in our coverage universe. While leasing risks have increased on its One Raffles Place Tower 2, which is still not pre-committed ahead of its target completion in 4Q11, we estimate it only makes up 6% of its RNAV.
"Its OUE Bayfront is already 77% committed and achieving latest rents of $13/sqft. Our sensitivity test shows that even if property prices/rents across all segments fall 20%, its RNAV will fall to $3.28, still a 40% upside to the current stock price. MAINTAIN OUTPERFORM."
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