Stock Name: Yoma
Company Name: YOMA STRATEGIC HOLDINGS LTD
Yoma Strategic Holdings: BUY; S$0.48; Bloomberg Code: YOMA SP
(Initiating Coverage)
Scaling Yoma's golden heights
Price Target : 12-Month S$ 0.60
• Initiate Buy for potential return of 25% to TP of S$0.60, based on
parity to RNAV
• Earnings growth from property sales is strong and would get stronger
given limited supply in the market against overwhelming demand
• Acquisitions and partnerships would drive upsides; political &
dilutive fund-raising exercise are key risks
Yoma is a direct proxy to Myanmar's booming real estate sector. With close
to 100% of its land bank in Yangon, Myanmar's Yoma Strategic Holdings
("Yoma") is strategically positioned to benefit from Yangon's booming
demand for residential, office, hotel / serviced apartment properties.
Prices have risen 20% in the past nine months. We believe this uptrend will
continue as overall supply remains tight due to the dearth of new
developments over the past few decades.
Though FY13 earnings to double, growth is still at nascent stage. While
Yoma's share price has had an exceptional run YTD, helped along by Yangon's
surging property prices, we believe believe value will continue to increase
1) a steady stream of pro-business policy reforms from the government,
which should attract yet more foreigners in search of business
opportunities in Myanmar. Near term, a strong increase in home prices and
take-up rates should see the group's earnings grow by 100% this year; 2)
land acquisitions, including a highly sought after prime site in downtown
Yangon, likely to expand RNAV, and 3) its ability to forge strategic
partnerships with foreign players (such as the recent JV with Parkson
giving Yoma a 20% stake in all of Parkson's shops in Myanmar). Such
arrangements bode well for long term recurrent earnings.
Initiate with Buy, TP $0.60. Our TP is based on parity to RNAV of S$0.60,
similar to property stocks in emerging markets. Upside is possible as our
valuation is based on ASPs which are flat against still soaring property
prices in Yangon. Our analysis showed that every 10% rise in property
prices will raise RNAV by 5cts. Yoma has a small net cash position and
cashflow is positive. But for future land acquisitions, Yoma may have to
either form strategic partnerships or to tap capital markets for funding.
Company Name: YOMA STRATEGIC HOLDINGS LTD
| Research House: DBS Vickers | Price Call: BUY | Target Price: 0.60 |
Yoma Strategic Holdings: BUY; S$0.48; Bloomberg Code: YOMA SP
(Initiating Coverage)
Scaling Yoma's golden heights
Price Target : 12-Month S$ 0.60
• Initiate Buy for potential return of 25% to TP of S$0.60, based on
parity to RNAV
• Earnings growth from property sales is strong and would get stronger
given limited supply in the market against overwhelming demand
• Acquisitions and partnerships would drive upsides; political &
dilutive fund-raising exercise are key risks
Yoma is a direct proxy to Myanmar's booming real estate sector. With close
to 100% of its land bank in Yangon, Myanmar's Yoma Strategic Holdings
("Yoma") is strategically positioned to benefit from Yangon's booming
demand for residential, office, hotel / serviced apartment properties.
Prices have risen 20% in the past nine months. We believe this uptrend will
continue as overall supply remains tight due to the dearth of new
developments over the past few decades.
Though FY13 earnings to double, growth is still at nascent stage. While
Yoma's share price has had an exceptional run YTD, helped along by Yangon's
surging property prices, we believe believe value will continue to increase
1) a steady stream of pro-business policy reforms from the government,
which should attract yet more foreigners in search of business
opportunities in Myanmar. Near term, a strong increase in home prices and
take-up rates should see the group's earnings grow by 100% this year; 2)
land acquisitions, including a highly sought after prime site in downtown
Yangon, likely to expand RNAV, and 3) its ability to forge strategic
partnerships with foreign players (such as the recent JV with Parkson
giving Yoma a 20% stake in all of Parkson's shops in Myanmar). Such
arrangements bode well for long term recurrent earnings.
Initiate with Buy, TP $0.60. Our TP is based on parity to RNAV of S$0.60,
similar to property stocks in emerging markets. Upside is possible as our
valuation is based on ASPs which are flat against still soaring property
prices in Yangon. Our analysis showed that every 10% rise in property
prices will raise RNAV by 5cts. Yoma has a small net cash position and
cashflow is positive. But for future land acquisitions, Yoma may have to
either form strategic partnerships or to tap capital markets for funding.
No comments:
Post a Comment