Sing Holdings

[thinleyw]

@bargainhunter
I agree, that they are skilled at developing properties. However, this new venture seems a bit out of their "circle of competence."

[Big Toe]

Sing Holdings did not have much of a choice. With a depleted land bank, no new development, they had to use the money if an opportunity arises.
I very much agree with them on not being overly aggressive on bidding for land in sg. But overheads still need to be covered, until a point where a sustainable income(i.e hotels and other rental properties) becomes more significant, it would be difficult for them to just sit around and do nothing while operating expenses still continue on.

This would be something new for them and they took a calculated risk. Hope it works out for them. I would probably do the same if I were them, to seek more stable income.
Property development is feast and famine business.
(previously vested)

[thinleyw]

What about buying back shares?  It seemed like repurchasing shares would have created tremendous shareholder value. IMO, the shares were unfairly discounted prior to acquisition (was very bullish).  Post acquisition I think only time will tell if the discount to book is warranted.

[bargainhunter]

What about buying back shares?  It seemed like repurchasing shares would have created tremendous shareholder value. IMO, the shares were unfairly discounted prior to acquisition (was very bullish).  Post acquisition I think only time will tell if the discount to book is warranted.

that's true, shareholders should push for buying back more strongly at the agm.  while he did say that no use supporting share price, there's a value perspective now in buying back the shares.

[dydx]

FY16 full-year result (first released on 14Feb17) makes interesting reading....
http://infopub.sgx.com/FileOpen/SHL_FY20...eID=439195

Very strong B/S being maintained. If we factor in future profits on the completed properties for sale with a balance at $114.8m (as at 31Dec16) by assuming a normal GP margin of 17.8% (achieved in FY16) - a reasonable assumption as the remaining units in the Waterwoods EC condo and the Robin Residences condo projects are being sold down gradually - Sing Holdings would have an adjusted NAV/share of slightly in excess of $0.70, and this is before counting profits from the yet-to-be-launched condo project at Fernvale Road being developed by a 70/30 j-v with Wee Hur Group, and recurrent profits from operations of Travelodge Dockland (a 291-key limited-service hotel located in Docklands, Melbourne, Australia) acquired for A$107.0m in Jan17.

An unchanged final dividend of $0.01/share and a higher special dividend of $0.00375/share (FY15: $0.0025/share) declared.

[bargainhunter]

FY16 full-year result (first released on 14Feb17) makes interesting reading....
http://infopub.sgx.com/FileOpen/SHL_FY20...eID=439195

Very strong B/S being maintained. If we factor in future profits on the completed properties for sale with a balance at $114.8m (as at 31Dec16) by assuming a normal GP margin of 17.8% (achieved in FY16) - a reasonable assumption as the remaining units in the Waterwoods EC condo and the Robin Residences condo projects are being sold down gradually - Sing Holdings would have an adjusted NAV/share of slightly in excess of $0.70, and this is before counting profits from the yet-to-be-launched condo project at Fernvale Road being developed by a 70/30 j-v with Wee Hur Group, and recurrent profits from operations of Travelodge Dockland (a 291-key limited-service hotel located in Docklands, Melbourne, Australia) acquired for A$107.0m in Jan17.

An unchanged final dividend of $0.01/share and a higher special dividend of $0.00375/share (FY15: $0.0025/share) declared.

The fernvale plot would be released only closer to year end.  However, judging from the recent laucnhes, a small unit strategy would sell well.  Chip Eng Seng replicated their same small units strategy from the fernvale plot (in 2015) at last weekend's tanah merah plot and both projects have sold well.

[luckystar]

New TDSR and SSD rules announced, which is very very positive for property developers. I guess now it is a great time for Sing Holdings to launch the Fernvale project. Demand would be very strong since if loan is less than 50%, TDSR LTV does not apply anymore. Should sell like hot cake, and can even raise the launch price.

[learner88]

Demand would be very strong since if loan is less than 50%, TDSR LTV does not apply anymore.  Should sell like hot cake, and can even raise the launch price.

When you have a hammer, everything looks like a nail. 

From MAS' Joint Press Release
"We will no longer apply the TDSR framework to mortgage equity withdrawal loans with LTV ratios of 50% and below."


http://www.mas.gov.sg/News-and-Publicati...perty.aspx

Relaxation for TDSR only applies to mortgage equity withdrawal loan. That is key. 

Sing Holdings will not be a direct beneficiary, and very likely not directly beneficial for the Fernvale project.

Everybody should do their own DD. Don't trust what other people posted, including what I just said. 

 

[luckystar]

Demand would be very strong since if loan is less than 50%, TDSR LTV does not apply anymore.  Should sell like hot cake, and can even raise the launch price.

When you have a hammer, everything looks like a nail. 

From MAS' Joint Press Release
"We will no longer apply the TDSR framework to mortgage equity withdrawal loans with LTV ratios of 50% and below."


http://www.mas.gov.sg/News-and-Publicati...perty.aspx

Relaxation for TDSR only applies to mortgage equity withdrawal loan. That is key. 

Sing Holdings will not be a direct beneficiary, and very likely not directly beneficial for the Fernvale project.

Everybody should do their own DD. Don't trust what other people posted, including what I just said. 

 

I think it will definitely be good for the property developers as the sentiment improves. Furthermore, with the reduction of SSD, more people are able to get rid of their older or bigger or more expensive properties and move to another perhaps smaller ones that Sing Holdings is building in Fernvale.

And also, as government has already started tweaking the cooling measures, people will expect more relaxation going forward, and then prices will rise more in the future, so they should better start buying now while it is not too late. With this new found urgency, it will help to sell more units, faster.

[luckystar]

Demand would be very strong since if loan is less than 50%, TDSR LTV does not apply anymore.  Should sell like hot cake, and can even raise the launch price.

When you have a hammer, everything looks like a nail. 

From MAS' Joint Press Release
"We will no longer apply the TDSR framework to mortgage equity withdrawal loans with LTV ratios of 50% and below."


http://www.mas.gov.sg/News-and-Publicati...perty.aspx

Relaxation for TDSR only applies to mortgage equity withdrawal loan. That is key. 

Sing Holdings will not be a direct beneficiary, and very likely not directly beneficial for the Fernvale project.

Everybody should do their own DD. Don't trust what other people posted, including what I just said. 

 

I think it will definitely be good for the property developers as the sentiment improves. Furthermore, with the reduction of SSD, more people are able to get rid of their older or bigger or more expensive properties and move to another perhaps smaller ones that Sing Holdings is building in Fernvale.

And also, as government has already started tweaking the cooling measures, people will expect more relaxation going forward, and then prices will rise more in the future, so they should better start buying now while it is not too late. With this new found urgency, it will help to sell more units, faster.

To share a news from Asiaone.com:

Cut in seller's stamp duty may improve new home sales, boost sentiment: Analysts


Photo: The Straits Times
SINGAPORE - Sellers will no longer have to pay seller's stamp duty (SSD) if they sell a residential property three years after the date of purchase. The move applies to purchases made on or after Saturday (March 11).
The SSD is currently payable by those who sell a residential property within four years of purchase, at rates of between 4 and 16 per cent.

These rates have been cut by 4 percentage points for each tier.


For instance, for properties sold within the first year, the rate will be 12 per cent from Saturday, down from 16 per cent previously.
Properties sold within the second and third years will carry duties of 8 and 4 per cent respectively, down from 12 and 8 per cent previously.
The Government said that "the number of property sales within the four-year window has fallen significantly over the years since this SSD measure was introduced".

Analysts said that the cut in SSD will improve market sentiment and could have a positive impact on new home sales.
"As the rates will apply only to residential property purchase on and after March 11, the policy is unlikely to impact market activity," said Dr Lee Nai Jia, head of South-east Asia research at property consultancy firm Edmund Tie and Co.
He added that the change would move the needle of new homes sold slightly, adding an additional 3 per cent to his initial forecast of 8,000 private new homes to be sold this year.
The moves gives a "positive vibe to the market.... gives the signal that the market is bottoming, which will attract more buyers," said Dr Lee.
"With the market stabilising at current price levels and the weaker rental market, most buyers are purchasing for owner occupation, or long term investment. Hence there is less need to set such a long period for the stamp duties," he added.
Mr Alan Cheong, Savills Singapore research head, said: "It's a marginal kicker, a discreet treat for developers.
"This is another bullet point for marketeers of the new launches, but there is still a 12 per cent duty if one sells within the first year, and it is a big hurdle to expect prices to rise that much."
"With the total debt servicing ratio framework, the SSD is less relevant as there are far fewer speculators in the market now," he added.