Of note, CDL sold its 50.1% stake in South Beach at a $2.75 billion valuation to partner IOI Properties at premium to book value of around 3%, which will lead to a meaningful gain.
As disclosed in its 1HFY2025 results, CDL has already sold $1.5 billion worth of assets there's a prospect of a special dividend from proceeds of the sale.
In addition, with projected lower borrowing costs over the next 12 months, dropping from 4.4% in 2024 to 4% in 1HFY2025, the “capital recycling plus cheaper funding” theme should continue to play out for CDL this year.
In contrast to other analysts, Loh is suggesting that there might be another upside surprise for this stock.
See also: RHB stays overweight on Singapore’s real estate stocks with top picks CDL, Coliwoo
Referring to the freehold premium new launch Newport Residences, Loh says that this could be a precursor to a potential tweaking of the foreigners' 60% Additional Buyers Stamp Duty (ABSD). "A fine-tuning of this measure is overdue in our view," says Loh.
One way is to retain the foreigners' ABSD but only for properties below $10 million, for example. By doing so, this will remove the competition with local buyers, says Loh.
And of course, with the high-profile boardroom cum family fight behind, Loh expects "a more pleasant" Chinese New Year this time round.
See also: Launch of Newport Residences a possible catalyst for CDL's share price: DBS
"We believe that CDL will continue its re-rating given lower perceived execution risk and a clearer runway to implement its capital recycling and development pipeline," he adds.
Loh's target price of $11.50 is pegged to a 15% discount to his RNAV estimated at $13.54 per share.
Prior to this, he had used a 33% discount to his previous RNAV estimate of $12.70.
"In our view, our narrower discount is justified given the material progress that management has made in its capital recycling program and unlocking of value for its noncore assets," says Loh.
CDL shares traded at $9.15 as at 11.13 am, up 0.55% for the day, extending a gain of 80.83% in the past year.
