Singapore Property

Send out Dec 16

CIMB Daily Note:
URA released the new private home sales data for Nov 2009 yesterday. 600 new private homes were sold or a 26% MoM fall in transaction volume, bringing total sales YTD to 14,370 units. This is the second month that the sector saw new private home sales below 1,000 units post cooling measures announced in Sep. We are not concerned by this though, as we believe the seasonally weak year-end and lack of meaningful new launches played a part in the property breather. The positives from this set of data came from improving sentiments for the mid to high-end segment, evidenced by relatively good demand for larger units. In our coverage universe, we see Hobee (Outperform, TP: S$1.95) and Allgreen (OUTPERFORM, TP: S$1.50) as main beneficiaries to the mid to high-end recovery theme going into 2010. We maintain our Overweight call on the sector on strong financial positions both at the developer and buyer level, and improvements in the real economy going into the new year.

Meanwhile pls see attached DBS daily note giving the same call on property counter.

General take is that the start of the IR early next year should create some hype in the property market especially in the mid to high end segment. While the mass market segment has cooled down, ground talk continue to see transaction in the mid to high end segment in line with the recovery of the global economy.

The high end segment is also less affected by the Singapore government recent measure to cool down the property market.

Attached is the daily price chart of SC Global, which show a recent short-term breakout on the 11 of Dec with good volume. Expect any pullback to be supported by the lowest trendline. On the whole, it has been trading at the lowest band lately, which will give it room for more upside ahead when property counter runs again.

As usual, my mantra...invest in what you understand only!
God bless!