Stock Name: Ho Bee
Company Name: HO BEE INVESTMENT LIMITED
Ho Bee has announced a trading halt. We believe it could be linked to potential sale of the Hotel Windsor in Macpherson Area (Nobel design one of the party hinted at buying the asset is also on halt).
Hotel Windsor is a mix of retail/hotel space with first 9 storey comprising of a retail podium and 225 hotel rooms on the upper floor levels with a total GFA of about 156,638 sqft. In our model we are conservatively valuing the asset at S$64m which accounts to ~3% of its RNAV(S$1.9b) and 4% of its book value(S$1.7b). Media sources has reported the selling prices of about S$163m, which if goes through will result in an accretion of 14 S cents or a 5% accretion to our current RNAV of S$2.67/share. We don't expect any special dividends from the sale(despite low gearing of 0.26x) considering volatile macro environment and expect funds to be pumped back into acquisition of Singapore commercial or overseas properties(mainly China).
Maintain BUY with a target price of S$1.86/share pegged at 30% discount to RNAV of S$2.67/share. Ho Bee is trading at a deep discount of 0.65x P/B and 45% discount to its RNAV and it's one of our top pick in the property sector.
Warm Regards,
Company Name: HO BEE INVESTMENT LIMITED
| Research House: OCBC | Price Call: BUY | Target Price: 1.86 |
Ho Bee has announced a trading halt. We believe it could be linked to potential sale of the Hotel Windsor in Macpherson Area (Nobel design one of the party hinted at buying the asset is also on halt).
Hotel Windsor is a mix of retail/hotel space with first 9 storey comprising of a retail podium and 225 hotel rooms on the upper floor levels with a total GFA of about 156,638 sqft. In our model we are conservatively valuing the asset at S$64m which accounts to ~3% of its RNAV(S$1.9b) and 4% of its book value(S$1.7b). Media sources has reported the selling prices of about S$163m, which if goes through will result in an accretion of 14 S cents or a 5% accretion to our current RNAV of S$2.67/share. We don't expect any special dividends from the sale(despite low gearing of 0.26x) considering volatile macro environment and expect funds to be pumped back into acquisition of Singapore commercial or overseas properties(mainly China).
Maintain BUY with a target price of S$1.86/share pegged at 30% discount to RNAV of S$2.67/share. Ho Bee is trading at a deep discount of 0.65x P/B and 45% discount to its RNAV and it's one of our top pick in the property sector.
Warm Regards,
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