Thursday, December 5, 2013

SG: MARKET PULSE: CDL Hospitality Trusts (5 Dec 2013)

Stock Name: CDL HTrust
Company Name: CDL HOSPITALITY TRUSTS
Research House: OCBCPrice Call: BUYTarget Price: 1.84




MARKET PULSE: CDL Hospitality Trusts
5 Dec 2013
KEY IDEA

CDL Hospitality Trusts: Proposed acquisition of Jumeirah Dhevanafushi
CDL Hospitality Trusts (CDLHT) has entered into conditional land and business sale agreements with Xanadu Holdings Pvt Ltd for the acquisition of Jumeirah Dhevanafushi in the Maldives at US$59.6m (~S$74.8m). Based on the purchase price and assuming that CDLHT owned the property from 1 Jan 2013, the pro forma annualised net property income yield of the property for the nine months ended 30 Sep 2013 would be 6.2%. While management indicated that the 4Q13 and 1Q14 performance for its Singapore hotels is still lackluster, this is within our expectations. We roll over our DDM model to FY14 numbers. Despite using a more conservative risk free rate of 3.0% (instead of 2.4% previously), our FV increases from S$1.83 to S$1.84 and we maintain our BUY rating on CDLHT. (Sarah Ong)

For more information on the above, visit www.ocbcresearch.comfor the detailed report.


NEWS HEADLINES

- US stocks ended mostly lower on Wed, with the S&P 500 and the Dow Jones Industrial Average extending their losing streak to four straight sessions.

- Singapore's economic growth will stay strong in the next two years relative to the other countries in Asean, the Centre for Economics and Business Research has predicted.

- SGX and Hong Kong Exchanges & Clearing said they have agreed to cooperate in various areas, including developing yuan-denominated products jointly.

- Genting Hong Kong and other shareholders have agreed to sell up to 25.3m shares in Nasdaq-listed Norwegian Cruise Line Holdings in a secondary public offering.

- WE Holdings is acquiring Hong Kong-based electronics distributor Everbest Industrial (International) for US$7.4m.

- Swissco Holdings has placed orders to add S$42m worth of vessels to its fleet, while Cosco Corporation has secured a US$54m contract.

- Yoma Strategic Holdings has unveiled plans for a joint-venture company to build and operate a steel mesh products manufacturing plant in Yangon, Myanmar.





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