UOB’s downwards earnings revision follows the release of PropNex’s 1Q19 results, which fell short of expectations due to lower project marketing contributions as a result of non-completed Options to Purchase (OTPs) and a time lag in sale recognitions.
SINGAPORE (May 22): UOB Kay Hian is maintaining “buy” on PropNex while lowering its target price to 60 cents from 66 cents previously.
The new target price is based on DCF and 2019F P/E of 10 times with reference to its closest listed competitor, APAC Realty, and comes after cutting net profit estimates by 11% to 15% for 2019-21F to reflect a shift in gross profit mix as well as higher staff cost assumptions.
