Global Logistic Properties (MC0.SG) is down 2.1% at $1.91, after hitting a post-listing $1.87 low earlier in robust volume of 12 million shares, with its sentiment likely dented after Chinese Premier Wen Jiabao said Sunday the government will set a target of 7.0% average GDP growth for 2011-2015.
GLP has a total China GFA of 6.9 million sqm, about 71% of its overall portfolio. “I suppose if you were to take the 7.0% figure at face value, people think ‘oh no, they’re really tightening the screw’ and therefore opportunity will be significantly reduced, so if people make that correlation, that’s what this news implies on the surface for people like GLP etc.,” says CIMB economist Song Seng Wun.
However, he adds, “I think we can be a bit more discerning and think the pace of growth may slow down but the opportunity and underlying momentum remains fairly firm, the chances are that 7.0% number is more rhetoric than anything else.”
$1.88 likely to support near term.
