Shares of Singapore property developer CapitaLand (CATL.SI) rose as much as 2.8% on Wednesday, buoyed by hopes it could benefit from spinning off its assets into trusts and as its valuations looked cheaper than its peers.
At 12:22 p.m., shares of CapitaLand were traded at $2.62 with 2.7 million shares changing hands.
At 12:22 p.m., shares of CapitaLand were traded at $2.62 with 2.7 million shares changing hands.
CapitaLand, Southeast Asia’s largest property developer, plans to spin off its developed Chinese projects into two mainland-listed real estate investment trusts (REITs) when China approves listing of REITs, its CEO told Reuters in an interview on Monday.
“The recent talk that it may spin off more assets into Reits will benefit the company, as it continues to redeploy its capital,” said a local dealer.
Kim Eng Securities also said it was confident CapitaLand’s business in China will be profitable and its share price underperformance relative to its Hong Kong and Chinese peers, such as Evergrande Real Estate Group (3333.HK), was unjustified.
“It has underperformed some Hong Kong and Chinese developers and been penalised even though their asset quality is better than some of the other players,” said Wilson Liew, an analyst at Kim Eng.
CapitaLand shares have fallen about 4% since November, while Evergrande has dropped by only 2% in the same period.
“They’re not over exposed to the residential segment in China, and are well-balanced in commercial assets as well, which has less risk from government measures,” he added.
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