Singapore and emerging market real estate

Royston Foo

Equity Bottom-Up

On 9th May 2019, Oxley released an announcement in response to queries by SGX in relation to the Chevron House transaction. More light was shed on the mechanics of the transaction.Based on my estimates, Oxley could potentially recognise a total divestment gain of S$168 mil or S$0.041 per share from this transaction.The resulting impact on NAV is a 12% accretion to NAV, which will increase from S$0.341 per share (as at 31st Dec 2018) to S$0.382 per share (pro-forma 31st Dec 2018).Whilst market does not like uncertainty, Oxley’s current share price is understating the positive impact of the transaction. Keeping all other fundamentals of the company unchanged, a fair increase in Oxley’s share price post-announcement should be S$0.035 per share (rounded) based on the above worst-case scenario divestment gain, translating to a fair value of S$0.335 per share. This implies a 9.8% upside above the last traded price.

On 9th May 2019, Oxley released an announcement in response to queries by SGX in relation to the Chevron House transaction. More light was shed on the mechanics of the transaction.Based on my estimates, Oxley could potentially recognise a total divestment gain of S$168 mil or S$0.041 per share from this transaction.The resulting impact on NAV is a 12% accretion to NAV, which will increase from S$0.341 per share (as at 31st Dec 2018) to S$0.382 per share (pro-forma 31st Dec 2018).Whilst market does not like uncertainty, Oxley’s current share price is understating the positive impact of the transaction. Keeping all other fundamentals of the company unchanged, a fair increase in Oxley’s share price post-announcement should be S$0.035 per share (rounded) based on the above worst-case scenario divestment gain, translating to a fair value of S$0.335 per share. This implies a 9.8% upside above the last traded price.

Oxley Holdings – Shedding More Light on the Chevron House Sale