BY OUR ESTIMATES, developers on the SGX have spent S$242m in 3Q15 to repurchase their shares; this is the highest quarterly figure seen since 2013 and more than eight times the previous high in 4Q13.  GLP is present in 36 cities in China with 21.8 M sqm portfolio. Photo: CompanyWe highlight that GLP begun repurchasing its shares on 3 Aug 2015 and have since went into the market 35 times to purchase approximately 96m shares worth S$213m. With its firm balance sheet and significant capital headroom, we believe GLP repurchasing its current shares trading at a 34% discount to its RNAV and 15% discount to book represents an effective use of capital which is accretive to shareholders. Wing Tai similarly entered the market four times in 3Q15 to repurchase S$1.0m of shares after a recent downturn in its share price.  Eli Lee of OCBC Investment Research.We see solid long term value in its current share price at a 58% discount to book and 57% discount to RNAV, and the company’s share buybacks are significantly accretive to shareholders, in our view. We will view any further share repurchases by both companies near current levels to be firm positives. Maintain BUY on GLP [FV: S$3.07] and Wing Tai [FV: S$2.58]. |
