HLIH in turn is owned by Davos Investment Holdings (33.6%), Kwek Holdings (29.1%), and individuals from the broader Quek and Kwek clans (37.3%). Davos, whose address is Guoco Tower, is likely controlled by Quek Leng Chan and his family, and the largest shareholder as at FY2023 is Kwek Leng Kee, a brother. Guoco Group, controlled by Quek Leng Chan, famously sold Dao Heng Bank to DBS Bank in 2002 for $10 billion. Quek Leng Chan’s main listed entity in Singapore is GuocoLand (SGX:F17
) .
Kwek Holdings is controlled by Kwek Leng Beng, with Sherman Kwek holding some shares, along with his cousins Kwek Eik Sheng and Brian Kwek. Brother Kingston is not a shareholder.
Market observers have indicated that should there be hostile parties within the clan, whoever controls HLIH would control CDL, HL Finance and HL Asia.
See also: Rotational interest settles on an unexpected sector
Analysts are beginning to estimate the likely break-up value of CDL. The group adopts historical cost accounting, but in the past two to three years it has been reporting its book NAV and a revalued NAV based on fair value. It is also doing likewise with its gearing, which, based on its reporting standard, was 117% as of Dec 31, 2024.
One indicator is going in CDL’s favour is interest rates. US risk-free rates have eased significantly. The 10-year US treasury yield, which is the market’s risk-free rate, is at its lowest level this year at 4.2406, a tad below its 200-day moving average at 4.2419. This level is likely to act as a support, and the 10-year US treasury yield is likely to rebound from current levels.
See also: Here are some stocks trading at P/B discounts. A handful could narrow their discounts
Despite the weakness of risk-free rates - an indication that inflationary fears may have receded - the local FTSE REIT Index is near a one-year low, a three-year low and a five-year low. Short-term indicators are nearing the low end of their range, suggesting that a rebound should materialise.
Market participants in the Singapore market experienced the worst of both worlds on Feb 28. Bank shares fell because lower risk-free rates suggest softer interest rates but the S-REITs did not rebound. On the other hand, the FTSE REIT Index didn’t fall much, an indication that downward momentum has dissipated from a medium-term perspective.
As market watchers wait for the FTSE REIT Index to recover, they may also be calculating CDL’s break-up value. That’s all very well but some astute investors are wondering if Quek Leng Chan is likely to get there ahead of the rest. As at Dec 31, 2024, book NAV was $10.12.
FTSE REIT Index
