See for yourself previou years review of BUKIT SEMBAWANG




Valuation and recommendation
Lowering earnings estimates.
Bukit Semb revealed during its 3Q08 results
announcement that it will be reviewing the official launch of Paterson Suites and The
Vermont on Cairnhill. Our recent discussions with management suggest that the two
projects could be delayed till the latter part of 2008 or early 2009, depending on market
conditions. We initially assumed launches in 3Q08. Taking this guidance coupled with
the exclusion of Airview Towers, we are adjusting our earnings recognition schedule to
reflect: 1) potential delays in unit sales; 2) higher development cost assumptions; and
3) lower contributions from the former Airview Towers-Chez Bright project. Our FY09-
10 EPS estimates have been reduced by 17-20%.



Hiccup to valuations, but still attractive; maintain Outperform.
We cut our end-
CY08 RNAV estimate by 9% to S$16.30 from S$17.97 following the exclusion of
Airview Towers and further delays in our unit sale schedule. Our target price, still
pegged at a 20% discount to RNAV, falls from S$14.36 to S$13.04. With buyers
adopting a wait-and-see attitude, asset price growth is likely to remain subdued in the
near term. Our ASP assumptions continue to be conservative for Bukit Semb’s
remaining residential projects. Despite this, valuations for the stock are undemanding,
at a 45% discount to our RNAV estimate and offering 45% upside potential. Maintain
Outperform.




CIMB-GK Securities

15th February 2008 08:33 AM
investment Bukit Sembawang Estates(BS SP / BSES.SI, OUTPERFORM - Maintained, S$8.96 - Target: S$14.36)
3QFY08 results - Timing the market
by Donald Chua

BS's 9M08 core EPS of 24cts came in above our expectations, forming 87% of our full-year estimate. 3Q08 revenue grew 31% yoy on the recognition of Mimosa Terrace, Parc Mondrian and Paterson Suites. With the disposal of non-core assets, net gearing fell to 1.02x from 1.6x. BS will be reviewing its launch schedule. We continue to assume conservative ASP assumptions for The Vermont at S$2,000psf. The appeal by the Vendor of Airview Towers against STB will be heard on 19 Feb. We have adjusted our recognition schedule and FY08-10 EPS estimates by -9% to +8%. Our CY08 RNAV estimate remains unchanged. Our target price, on the other hand, has been reduced from S$16.15 to S$14.36, now set at a 20% discount to RNAV, in line with the 10-year historical average of the sector. The stock trades at a 50% discount to RNAV and offers 60% upside. Maintain Outperform.

cimb

11th December 2007 03:41 PM
investment BT SEMB, cimb remains OUTPERFORM with target price $16.15
- Reiterate Outperform on its huge legacy land bank in the Yio Chu Kang/Ang Mo Kio area coupled with upcoming high-profile launches. We believe its low-cost land bank gives BukitSemb the edge over the rest of the listed developers by providing margin buffers in the event of asset deflation.
- Prime projects set for launch in 2008. Paterson Suites has been soft-launched overseas. We understand that take-up was around 18 units of the 20 launched, at ASPs of S$3,400 psf. Others to follow in 2008 would include the Vermont at Cairnhill (estimated ASP of S$2,000psf) and the Carlton Terrace site at Holland Road (S$1,600psf), both acquired in the last two years at substantially lower costs than current prime land rates. We believe our ASP assumptions are conservative even in a maturing cycle and look for margins to breach 35% for both projects.
- Awaiting Airview Towers en bloc deal. Management remains positive that the en bloc sale will materialise in the near term. The sale was dismissed by the Strata Titles Board in November on technical grounds. We do not expect any delays in the launch as we earlier assumed a release only in 2H08. Potential accretion from Airview Towers is still included in our forecasts.
- Target price scaled back to S$16.15 from S$17.95, on 10% discount to end- CY08 RNAV. The 10% discount is consistent with our new valuations for small-cap developers under our coverage, at this stage of the property cycle. At current levels, the stock provides potential upside of 46% and is our top pick in the small-cap space. We consider BukitSemb a cheaper proxy for Singapore residential property than CityDev, with a 10% change in overall selling prices for its upcoming launches possibly resulting in a 7% change in its RNAV.
13th November 2007 04:25 PM
jerome Source: CIMB

• Below expectations. 2Q08 EPS of 7.8cts (fully diluted) is below our expectations, forming 11% of our full-year estimate and 9% of consensus’s. The key variance was the lack of accretion from Watercove Ville during the quarter. Our discussions with management suggest that the project is unlikely to be launched in the near term. With prices of landed properties improving, we believe BS is timing the launch to capture better pricing. As such, we now expect the project to be launched in 3Q08.

• Strong progressive recognition. Sales and net profit leapt 36% and 45% yoy respectively on bookings of residential units sold in Straits Garden, Mimosa Terrace and Parc Mondrian. The quarter also saw maiden contributions from Paterson Suites. We expect progressive recognition from these projects to underpin earnings in FY08. BS will also pay shareholders a 5cts/share interim tax-exempt dividend.

• Cash realised to pare down gearing. Net gearing fell from 1.6x to 1.1x. The balance sheet was strengthened by the recent disposal of BS’s non-core stake in HSBC Holdings (net gain of S$47m) and funds received from warrant conversion. Net proceeds amounted to S$63m and S$112m respectively and were used to pare down bank borrowings. .

• Sales of Paterson Suites progressing well; more launches in 2008. Paterson Suites has been soft-launched overseas. We understand that take-up has been favourable with around 18 units of the 20 launched sold at ASPs of S$3,400 psf. Other projects in prime districts which could be launched in the near term include The Vermont and the Carlton Terrace site at Holland Road.

• Hiccup for Airview Towers en-bloc sale. Management revealed that STB has dismissed the application of Airview Towers for en-bloc sale on technical issues. We understand that the sellers are planning to appeal and will be seeking further clarity from management on this. Potential accretion from Airview Towers is still included in our model at the moment.

• Scaled back earnings estimates and target price; maintain Outperform. We have lowered our ASP assumptions by 10% for impending projects such as Fairways Condo, St. Thomas Walk site and Carlton Terrace, to reflect a more cautious stance in the current cycle. Our FY09-10 EPS estimates are consequently reduced by 14-18%. However, our FY08 EPS forecast has been raised by 7.2%, factoring in the S$47m net gain from sale of non-core investments. Our end-CY08 RNAV estimate and target price have been shaved from S$18.30 to S$17.95 as gains from non-core disposal offset lower ASP assumptions. Maintain Outperform as earnings are expected to flow through in FY09.
6th November 2007 04:55 PM
investment BT SEMB, ml put new rating BUY with target price $17.50
- We initiate coverage on Bukit Sembawang Estates Ltd (Bukit Sembawang) with a Buy rating and a S$17.50 RNAV-based price target. Traditionally, investors see Bukit Sembawang as a company that is too focused on selling its landed housing units on its legacy land. But we believe this perception is changing as the company has acquired six sites for high rise projects since 2005 and will be launching these projects for sale over the next 6-9 months. Valuations are undemanding with the stock trading at 43% discount to our RNAV of S$19.70 with excellent net dividend yields of 12% in 2009E and 15% in 2010E.
- Owns one of the largest landbank in Singapore . The company owns about 4.5mn sf of saleable area for residential housing in Singapore, making it the second largest owner of undeveloped land in Singapore. The cost of the company's land is also very cheap with its landed housing site at 43% below market price and its non-landed housing sites at between 13-20% below market price.
- Strong line-up of launches . Positive catalysts are the launch of at least 3 mid-high end condominiums over the next 9 months. The sale of these 3 projects will realize 26% of the RNAV and the resultant earnings will transform the company with earnings forecast to grow at EPS CAGR of 344% between 2008 to 2010.
- Key risks. There is a risk of more changes in Government regulations to cool the market if growth in property price does not moderate after the recent abolition of the deferred payment scheme. In this period of uncertainty, we prefer property stocks that have attractive valuation and a more sustainable business model and Bukit Sembawang fits the description.
25th October 2007 12:44 PM
investment BT SEMB, abn put new rating BUY with target price $19.27
- BSE has a vast land bank, of which 72% is slated for landed developments. A re-rating of landed properties and rosy outlook on the mass private segment would boost the valuation of BSE, which trades at a 41% discount to RNAV. We initiate coverage at Buy.
- Attraction of landed property. We believe that a re-rating of Singapore's landed property is imminent, as it now trades at a steep 37% discount to non-landed property. This compares with other Asian cities where landed properties trade at premium. While the discount is due to restrictions on foreign ownership, we believe a re-rating should occur because (i) the increasingly affluent resident population has a high propensity to invest in real estate (ii) locals are increasingly participating in the current property cycle - the churn rate of landed property is currently at 1% vs 8-10% during the 1996 peak and (iii) landed property is becoming scarce.
- Re-rating of landed housing set to boost valuation. Seventy two per cent of BSE's land bank is slated for landed developments. While these are located in the north east region, which falls under the mass segment, a rerating of landed properties should benefit BSE. Furthermore, rising HDB prices due to tight supply of new flats should prompt many to upgrade to the mass private market - a positive as 34% of buyers of landed housing in the north east are HDB upgraders. Our target price of S$19.27 is derived from our RNAV estimates. Based on an ASP of S$750 psf for landed developments and S$2,400 for prime properties, BSE trades at a 41% discount to RNAV. Its land bank also offers earnings visibility for the next eight years.
- Robust margins expected for prime sites. BSE had been accumulating prime residential sites since 2005, 80% of which were acquired during 2005-2006, when prices were still benign. Prime prices have soared 82% ytd, which assures robust operating margins of 38% for BSE's prime sites, on our estimates. The prime segment accounts for 43% of its RNAV.
- Positive outlook on mass residential segment. We expect the mass segment to benefit from high population growth, thus creating new demand of 9,000-10,000 private units pa vs 8,000 in the past decade. Job creation should remain robust as the government plans to create 90,000 jobs pa in the next five years vs an average of 60,000 pa in the past six years. Of these, 40- 50% will be in the mid-low skill sectors, likely taken up by immigrants due to a tight labour market.
4th October 2007 05:21 PM
kovan Bukit Sembawang target price raised to 18.30 sgd - CIMB-GK

SINGAPORE (Thomson Financial) - CIMB-GK Research said it has lifted its target price for Bukit Sembawang, a Singapore property developer focused on suburban landed housing projects, to 18.30 Singapore dollars a share from 16.40 dollars previously because it expects the company to increase the selling prices of its projects amid prevailing strong property demand.

Bukit Sembawang has various projects in the vicinity of the northern town of Ang Mo Kio where privately held Far East Organization paid a record price of 601 Singapore dollars per square foot for a suburban residential condominium site, it said.
18th September 2007 07:54 PM
investment BT SEMB, lehman put new rating OVERWEIGHT with target price $15.30
- Bukit Sembawang Estates holds one of the largest residential land banks in Singapore with 4.9mn sf in development gross floor area (GFA). We initiate coverage of Bukit Sembawang with a 1-OW rating and a 12- month target price of S$15.30, pegged at parity to our revised net asset value (RNAV) estimate, implying compelling potential upside of 53%.
- Large and inexpensive land bank We estimate the weighted average cost of Bukit Sembawang's land bank is S$253 psf per plot ratio (ppr) and expect its projects to fetch prices of S$500 psf to more than S$3,000 psf. We estimate average embedded pre-tax margin of 31%.
- Landed housing to play catch-up About 73% of Bukit Sembawang's land bank is zoned for landed housing development in the northern suburbs. Landed property prices are still 29% below the peaks in 2Q96 (vs. 12% for non-landed housing).
- Highest Potential Dividend Payout Growth Based on targeted gearing and financing needs for projects on hand and our forecast 3-year earnings CAGR of 149%, we estimate Bukit Sembawang offers a dividend CAGR of 42% over the corresponding period.
14th September 2007 08:48 PM
investment BT SEMB, cimb remains OUTPERFORM with target price $18.30
- Record price for Ang Mo Kio site. Privately-held Far East Organization recently clinched a condominium site along Ang Mo Kio (AMK) Avenue 8 for S$203m or S$601 psf, a new record set for suburban land prices. Recent resales of non-landed properties in the vicinity such as Grandeur 8 and Far Horizon Gardens were transacted at S$400-600 psf. Based on this latest land price, we estimate breakeven for the site at S$900-1,100 psf, with selling prices possibly touching S$1,200-1,300 psf, far exceeding current transacted rates.
- Expect positive impact on non-prime property prices. This transaction reaffirms our view that prices in the mass-mid market are set to take off in the next 12-18 months. Based on URA's latest 2Q07 numbers, average prices outside central areas have started to move north, up 7.2% qoq in the quarter. We believe this piece of news will not only spur property prices in neighbouring districts, but is likely to boost sentiment on other non-prime areas as well.
- Set to benefit from its legacy. On top of its prime district exposure, Bukit Sembawang has a land bank of around 3m sf GFA in Yio Chu Kang/AMK Avenue 5, spread over four land parcels. The prized sites, slated for landed residential development, are part of Bukit Semb's legacy from its rubber-plantation days in the 1950s. Though lagging non-landed properties in the last two years, we note that prices of landed properties are starting to show signs of life. URA's 2Q07 landed property index was up 7.1% qoq, after benign growth in the preceding quarters. With the latest transaction expected to raise price expectations in AMK, we believe Bukit Semb will benefit from potentially higher selling prices for its residential land in the area.
- Raising AMK selling prices by 30%. In anticipation of higher selling prices in the AMK vicinity, we raise our ASP assumptions for Bukit Semb's landed property developments in the area by 20% to S$650 psf, in line with current average resale values for Bukit Semb's Mimosa Terrace. Our discussions with management suggest that Bukit Semb is in no hurry to launch its AMK sites, but would rather hold out for better prices as it believes that overall prices in the area will appreciate further.
- RNAV boosted by 12% to S$18.30. On the back of our higher ASP assumptions, our end-CY08 RNAV estimate has been raised by 12% from S$16.40 to S$18.30. However, our EPS estimates have been kept intact as we believe the AMK sites are unlikely to be launched in the near term.
- Target price - still based on parity with RNAV estimate - lifted to S$18.30. We estimate that a 10% change in selling prices in the AMK area alone will lift Bukit Semb's RNAV by around 4% while a 10% change in overall selling prices islandwide will augment its valuation by 16%. Trading at a 45% discount to our end-CY08 RNAV estimate, Bukit Semb is our top pick among the small-cap developers under our coverage, with 81% potential upside to our target price. Catalysts are expected to come from higher-than-expected selling prices in AMK and upcoming prime district launches. Reiterate Outperform