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Share price now way below the level when the bid spec came out. Those who bought at the time now holding the bag. Much ado about nothing as I said at the time.
Alignment ( Date: 15-Jan-2024 10:38) Posted:
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Frasers Property posts pre-sold revenue of S$2.4 billion as at Dec 2023 net gearing ratio up to 78%
FRASERS Property : TQ5 +1.16% has achieved pre-sold revenue of S$2.4 billion across Singapore, Australia, Thailand and China as at Dec 31, 2023, with &ldquo steady progress&rdquo for its residential development portfolio, it said in a Friday (Feb 2) business update.
Its net gearing ratio increased in Q1 FY2024 to 78 per cent as at Dec 31, 2023, up 2.2 percentage points end-September. But the group said it continues to focus on proactive debt management, and is well-positioned to repay and/or refinance all of its debt due in the financial year.
Frasers Property&rsquo s Singapore residential business remains resilient fuelled by a new pipeline, it said. It had secured a government land sales site in Toa Payoh, &ldquo an established and popular residential estate&rdquo , via a joint venture in which it holds a 25 per cent stake. The site is expected to yield 777 units.
Its luxury residential development Riviè re was completed in FY2023 current active development projects &ndash Parc Greenwich Executive Condominium and Sky Eden@Bedok &ndash are almost fully sold and on track for completion.
Housing demand in Singapore is expected to remain resilient, driven mostly by homeowners, Frasers Property said, adding: &ldquo Developers are taking a more cautious approach to land bids in view of the large housing supply released in H1 2024 by the government to cater to strong housing demand.&rdquo
It also noted a 6.8 per cent on-year increase in Singapore&rsquo s private residential prices in Q4 of 2023, though sales volume fell 13 per cent on year for the 12 months to Q4 2023, on account of macroeconomic headwinds, the higher interest rate environment, and government cooling measures.
In Singapore, it sold eight units in Q1, with unrecognised revenue amounting to S$0.9 billion.
Frasers Property also highlighted strong sales in Australia for Q1 on the back of robust demand. It sold 286 units in Q1 there and noted unrecognised revenue of S$0.8 billion.
In Thailand, it is focusing on managing inventory and strategically diversifying housing segments, amid a challenging business environment. Some 320 units were sold, while unrecognised revenue was S$0.03 billion.
As for China, the group has replenished its residential portfolio with investments in Shanghai and completed two joint-venture residential development projects in Q1 FY2024. The number of units sold in China stood at 640, while unrecognised revenue was S$0.7 billion.
Some 21 residential development projects totalling about 5,500 units across markets are scheduled for completion over the rest of FY2024.
Frasers Property&rsquo s net gearing ratio was 78 per cent as at Dec 31, up from 75.8 per cent as at Sep 30, which it attributed to capital expenditure, partially offset by its divestment of its Changi City Point stake.
It said its high proportion of fixed-rate debt mitigates the effects of high interest rates, &ldquo though cost of debt is likely to remain elevated in 2024 due to higher-for-longer interest rate environment&rdquo .
The group also noted its continued efforts to extend debt maturities with focus on green and/or sustainable financing.
Net debt rose 2.4 per cent to S$14.1 billion as at Dec 31, compared to S$13.8 billion as at end-September.
Looking ahead, Frasers Property said it remains focused on its priorities of achieving better risk-adjusted returns, visibility of earnings and cash flows.
Frasers Property announces key leadership movements
FRASERS : TQ5 -4.04% Property : TQ5 -4.04% on Monday (Jan 15) announced several organisational changes with effect from Feb 1, 2024.
Anthony Boyd, the chief executive officer of Frasers Property Australia, will be appointed to a newly created group chief operating officer role to work closely with the global executive leadership team. He will also support the group CEO in aligning strategic programmes.
Cameron Leggatt, the executive general manager of development at Frasers Property Australia, will be promoted to CEO to oversee the group&rsquo s development and investment operations in the country.
Zheng Wanshi, the group chief strategy and planning officer, will be appointed to an expanded role of group chief strategy and sustainability officer. She will work closely with the group functions and business units to integrate risk management, as well as sustainability, with the overall group strategy and operations.
Zheng will also oversee the group legal and corporate secretariat, as well as group data protection functions, as part of her broader focus on group governance.
&ldquo The business units&rsquo structure, which clusters the businesses into core focus areas by geography and global asset class, will see six business unit leaders reporting directly to the group CEO, instead of eight,&rdquo said the group.
Lim Hua Tiong, CEO for Frasers Property Vietnam and One Bangkok, will take an expanded role as CEO of emerging markets in Asia &ndash covering Thailand, Vietnam and China markets.
&ldquo These leadership changes will enable us to draw deeper upon group synergies, strengthen business resilience, and build further upon our strengths from both a geography and asset class perspective,&rdquo said group CEO Panote Sirivadhanabhakdi.
Additionally, with effect from Mar 1, 2024, group chief corporate officer Chia Khong Shoong and CEO of Frasers Property China Lorraine Shiow will be leaving the group to pursue other personal interests.
Consolidation.....This is a good counter....waiting for Next ride up...
Going up again....
Patience is the key.....Dividend coming...
Patience is the key.....Dividend coming...
mrwise ( Date: 15-Jan-2024 09:23) Posted:
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The article touches on the key point - it is questionable even if there were some corporate activity that Fraser is cooking up (which it has just denied on Friday, so nothing is happening anytime soon) that minority shareholders in this stock would see any benefit.
Frasers Property pops on deal rumour
Waning profitability and lowered dividend in recent years likely to have been as disappointing for majority shareholders as minority investors
MINORITY shareholders of Frasers Property Ltd (FPL) offered lots of ideas during the company&rsquo s annual general meeting (AGM) last year about what could be done to increase its dividend rate and boost its share price.
One shareholder suggested that FPL monetise some of its assets in order to lower its gearing and reduce the perceived risk profile of the group, the AGM minutes indicated.
Another shareholder asked if FPL had considered separating its property management business from its capital-intensive property development activities.
FPL was also cautioned about investing further in Australia by a shareholder, on the view that returns might be suppressed by continued depreciation of the Australian dollar against the Singapore dollar.
At FPL&rsquo s upcoming AGM &ndash scheduled for Jan 24 &ndash the company&rsquo s minority shareholders are likely to be much more interested in hearing what ideas the company&rsquo s controlling shareholders might be considering to unlock value for themselves.
On Jan 10, The Wall Street Journal reported that FPL&rsquo s majority shareholders may sell the company or some of its assets as part of a strategic review. This seemed to spur trading interest in FPL&rsquo s exceedingly depressed shares.
The stock closed last Friday (Jan 12) at S$0.99, up nearly 8.8 per cent for the week.
FPL did not comment on the news reports nor its surging share price until the end of the week. After the market closed last Friday, it said that it was not aware of any discussions in relation to the proposed transactions.
Discount to NAV
Without any information on what FPL&rsquo s controlling shareholders might be planning, minority investors cannot know for sure if they stand to benefit in any way.
Yet, the mere hint that things are about to change at FPL could keep its shares on the radar of analysts and investors in the weeks ahead.
Even after the strong rally last week, FPL is trading 60.7 per cent below its net asset value (NAV) as at Sep 30, 2023 of S$2.52 per share.
This seems an unjustifiably low price-to-book valuation for a blue chip real estate group with S$34.2 billion worth of properties around the world, spanning residential developments, commercial buildings and business parks, shopping malls, industrial and logistics assets, and hospitality properties.
FPL said in its FY2023 results presentation that 89 per cent of its property assets as at Sep 30, 2023 were generating recurring income. The group also has a stable of real estate investment trusts and capital partnerships to help optimise its capital productivity.
One possible reason for FPL&rsquo s depressed market valuation is its limited public float. As at Nov 28, 2023, corporate entities linked to Thai billionaire Charoen Sirivadhanabhakdi held nearly 86.9 per cent of FPL&rsquo s almost 3.93 billion outstanding shares.
This poses the risk of minority shareholders being squeezed out one day by a lowball privatisation offer.
Sagging profitability, dividends
My own view is that FPL&rsquo s seemingly low market valuation is largely a reflection of its weak underlying profitability and reduced dividend in recent years.
For FY2023, the group reported an 81.3 per cent decline in earnings to S$173.1 million. Revenue increased 1.8 per cent to nearly S$3.95 billion, while profit before interest and taxes rose 5.1 per cent to S$1.31 billion.
The steep decline in earnings in FY2023 was mainly due to net fair value losses on FPL&rsquo s commercial properties in the United Kingdom, and its industrial and logistics properties in Australia and the European Union, as capitalisation rates increased.
FPL pointed out, however, that it had chalked up a cumulative net fair value gain of S$3 billion from FY2018 to FY2023. This was the result of its efforts to drive long-term value creation at its investment properties.
Still, FPL&rsquo s return on equity (ROE) before fair value adjustments in FY2023 was only 3 per cent. During the preceding four financial years &ndash from FY2019 to FY2022 &ndash FPL generated ROE before fair value adjustments of 2 to 4 per cent.
This was lower than FPL&rsquo s ROE during the four years before that. From FY2015 to FY2018, its ROE before fair value adjustments ranged between 5.5 per cent and 7.7 per cent.
Then, there is FPL&rsquo s dividend rate. While FPL&rsquo s total dividend of S$0.045 per share for FY2023 is higher than for each of the preceding three years, it is below the S$0.06 per share declared for FY2019 and the S$0.086 per share declared for FY2018 and FY2017.
Poorly received rights
FPL&rsquo s waning profitability and lower dividend rate are likely to have been as disappointing for its majority shareholders as its minority investors.
It is worth pointing out that Thai Beverage and TCC Assets &ndash which are linked to Charoen &ndash coughed up a total of S$1.11 billion in 2021 for their respective entitlements to a 37-for-100 rights issue of new FPL shares priced at S$1.18 each.
Despite the rights issue being priced at a 47.5 per cent discount to FPL&rsquo s book value, valid acceptances and excess applications were received for only 982.9 million rights shares &ndash or 90.6 per cent of the total rights shares available.
This included the nearly 940.2 million rights shares taken up by Thai Beverage and TCC Assets.
FPL is now trading 16.1 per cent below its 2021 rights issue price.
Against the backdrop of more expensive borrowing costs, it is perhaps not surprising that the majority shareholders of FPL might now be looking for ways to quickly harvest value from the real estate group.
The big question is whether a deal &ndash if at all there is one &ndash will benefit minority investors too.
FPL&rsquo s independent directors should perhaps begin a dialogue with the key decision makers on this matter to ensure that minority investors are not left out in the cold.
Investor buying up on the dip on good opportunity!!!
Time to buy up! Loading for next movement up!
Free float on public hand is very low n likely to trigger privatization offer soon!
Now on investor radar already. Just wait patiently for good news!
Now on investor radar already. Just wait patiently for good news!
mrwise ( Date: 15-Jan-2024 01:41) Posted:
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Ride on the good company like Fraser!
Dont miss a good chance to get it at a good price...
Dont miss a good chance to get it at a good price...
mrwise ( Date: 13-Jan-2024 20:32) Posted:
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The reality is Frasers Property is undervalued but lacks catalyst for re-rating. The market bought into it over the last few days thinking the catalyst would have been the strategic review and the divestment of assets as reported by WSJ but given that the company is refuting that, wonder if that would have a knee-jerk reaction to the share price when market opens tomorrow.
Joelton ( Date: 13-Jan-2024 13:46) Posted:
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I get that, like many SGX listed companies, this company' s share price is significantly below fundamental value. The question is whether there is a catalyst that crystallises something close to fundamental value that pushes the share price up otherwise it' s just a value trap. If the rumours were true then that would have been such a catalyst - hence why the share price jumped in the last few days because some people found them credible. However it is now confirmed the rumours are not true.
This is a good counter....NAV is $2.52!
Exactly what I thought - nothing behind the rumours.
Frasers Property says it is &lsquo not aware&rsquo of any discussions to sell company or assets
MAINBOARD-LISTED Frasers Property issued a statement on Friday (Jan 12) refuting talk of a potential sale of the company or its assets.
It was responding to recent news reports speculating that the company&rsquo s majority owners could sell the company or some of its assets, as part of a strategic review.
&ldquo The company has not been informed, and is not aware of, any discussions in relation to the proposed transactions,&rdquo said Frasers in its statement.
The Wall Street Journal had first reported on the potential sale on Jan 10. According to it, the strategic review, which is in its initial stages, was part of shareholders&rsquo efforts to raise capital, in order to reduce the debt accumulated across the past few years from acquisitions.
However, there was no assurance of any outcome from the review, the report had added, citing people familiar with the matter.
Frasers advised shareholders to refrain from taking any action with respect to their shares in the company which may be prejudicial to their interests, and to exercise caution when dealing in the shares of the company.
This undervalued Gem is showing its true value !!
Still got so much to fill up the gap!!!
Still got so much to fill up the gap!!!
The ride has begin...towards $1.50 !!
Congrats to all onboard !
Congrats to all onboard !
mrwise ( Date: 11-Jan-2024 16:54) Posted:
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Be patience for the fruit to ripe...
The news is good... Now wait for more good news ahead!!!
My target should not be too far away...
The news is good... Now wait for more good news ahead!!!
My target should not be too far away...
mrwise ( Date: 10-Jan-2024 23:08) Posted:
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Congrats to those joining this party....
The party has just begin.....
Another good call !!! Dividend coming too !!! Hopefully delist soon....
The party has just begin.....
Another good call !!! Dividend coming too !!! Hopefully delist soon....
mrwise ( Date: 11-Jan-2024 14:09) Posted:
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