not vested
UOL Group: Firm sales momentum
UOL’s 3Q19 core PATMI fell 6.6% YoY to S$80.0m, but was in-line with our expectations.
UOL continued to deliver healthy take-up rates and robust ASPs for its Singapore residential projects.
Management also sounded upbeat about meeting its ABSD deadlines for its projects, and highlighted that there was improved buyer sentiment on the ground.
Its Singapore office portfolio has seen healthy take-up rates, but management alluded that sentiment appears to be softening, and guided for rental reversions to moderate from positive mid-single digit levels to flat.
As for the potential rejuvenation of Marina Centre Holdings (MCH), UOL is still continuing its discussions with the authorities and will evaluate its options.
We rate UOL a BUY with a higher fair value of S$9.25 (previously S$8.50) as we update our assumptions and apply a lower RNAV discount of 30% (previously 35%) to account for the better-than-expected performance of the Singapore residential market and UOL’s continued balance sheet strength.
Source: OCBC