Ho Bee Land – 4Q Earnings Hit by Unexpected Tax Provision

Ho Bee – Solid Foundation Laid for Next Growth Phase. REIT Listing a Potential Catalyst.

Singapore and emerging market real estate

Royston Foo

Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/18298" target="_blank" data-smartkarma-citation="entities:18298:1">Ho Bee Land Ltd (HOBEE SP)</a> ("HBL") reported its 3Q 2018 financial results last evening. No major surprises with the good set of results. Strong growth in rental income and contributions from associates are within expectations. But some minor positives were observed: 1) the one-off “right of light” compensation that resulted in a gain of £3 million (approximately S$5.3 million); and 2) capital management effort to improve balance sheet strength and reduce gearing. Key investment thesis and merits remain unchanged. I reiterate my BUY recommendation with a fair value of S$3.32 per share. Upside potential is attractive at 32.8%. The impending announcement of the new loan for the refinancing of existing bridging loan is a key announcement to look out in the next 1 to 2 months.

Ho Bee Land Ltd (HOBEE SP) ("HBL") reported its 3Q 2018 financial results last evening. No major surprises with the good set of results. Strong growth in rental income and contributions from associates are within expectations. But some minor positives were observed: 1) the one-off “right of light” compensation that resulted in a gain of £3 million (approximately S$5.3 million); and 2) capital management effort to improve balance sheet strength and reduce gearing. Key investment thesis and merits remain unchanged. I reiterate my BUY recommendation with a fair value of S$3.32 per share. Upside potential is attractive at 32.8%. The impending announcement of the new loan for the refinancing of existing bridging loan is a key announcement to look out in the next 1 to 2 months. 

Ho Bee Land – Good Results in Line with Expectations. Await Further Updates on Refinancing.