Stock Name: Wing Tai
Company Name: WING TAI HLDGS LTD
Kim Eng Research in a Jan 4 research report says: "In our opinion, Wing Tai is in no hurry to reduce its ASPs to move its high-end inventory yet, given its strong balance sheet and the current high costs of replenishing landbank.
"However, while headline ASPs are likely to remain downward-sticky, developers may subsequently absorb the ABSD either partially or in full to attract buyers. We have hence reduced our ASP assumptions for Wing Tai's high-end projects by 10% to account for this possibility. Even if the high-end segment comes to a complete standstill, Wing Tai is likely to focus on selling the remaining 287 units of Foresque Residences.
"Having reduced our ASP assumptions for the unsold high-end projects by 10% and ascribing a steeper discount of 65% to RNAV, we have lowered our target price to 97 cents. DOWNGRADE TO HOLD."
Company Name: WING TAI HLDGS LTD
| Research House: Kim Eng | Price Call: HOLD | Target Price: 0.97 |
Kim Eng Research in a Jan 4 research report says: "In our opinion, Wing Tai is in no hurry to reduce its ASPs to move its high-end inventory yet, given its strong balance sheet and the current high costs of replenishing landbank.
"However, while headline ASPs are likely to remain downward-sticky, developers may subsequently absorb the ABSD either partially or in full to attract buyers. We have hence reduced our ASP assumptions for Wing Tai's high-end projects by 10% to account for this possibility. Even if the high-end segment comes to a complete standstill, Wing Tai is likely to focus on selling the remaining 287 units of Foresque Residences.
"Having reduced our ASP assumptions for the unsold high-end projects by 10% and ascribing a steeper discount of 65% to RNAV, we have lowered our target price to 97 cents. DOWNGRADE TO HOLD."
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