Maybank Kim Eng raised its target price for property developer Keppel Land to $4.04 from $3.65 and kept its ’buy’ rating, on signs its sales in China are improving.
By 9:58 a.m., shares of Keppel were 1.5% higher at $3.44, and have surged 55% so far this year, outperforming the FT ST Financial Index’s 25.4% gains.
Keppel reported an 87.5% jump in its second quarter earnings to S$94.7 million, lifted by its high-end residential project in Singapore and K-REIT Asia, a real estate investment trust that it sponsors.
Keppel’s actual residential pre-sales improved in the second quarter, especially in China where it sold 491 units, up from 187 units in the previous three months, Maybank said.
“With buyers’ interest seemingly picking up in China, we think that Keppel Land will benefit and continue to roll out more units from its mass market projects, such as The Botanica in Chengdu and Tianjin Eco-city,” Maybank said.
It added that Keppel’s low net gearing of 0.2 times will allow it to remain nimble while seeking out acquisition opportunities.
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