Indeed, the valuation of 702m looks rich. As a reference, CDL H-Trust is trading at a 6% yield. This

Another undervalue stock in action today. Hopefully, caribbean cruise vacations with the acquisition of the medical suites and hospitality management business, the company's valuation and cash flow will be improved as compared to property company!!
(13-06-2012 09:36 AM) ngcheeki caribbean cruise vacations Wrote: Another undervalue stock in action today. Hopefully, with the acquisition of the medical suites and hospitality management business, the company's valuation and cash flow will be improved as compared to property company!!
If OPHL can successfully do a REIT listing, it will indeed unlock value. The 3 assets sold generated 27m in profits for FY2011, they are sold for 702m (page 11 in the attachment below). but the problem here is it takes great optimism to sell at such a high price. Will you buy into such a reit with p/e around 26, i wouldnt. Moreover, the properties are not freehold.
OPHL is also acquiring the healthcare caribbean cruise vacations and hospitality business from Far East at a cost of 420m with profits of only 8.8m (p/e almost 50). (page 15 of attachment). Nonetheless, the 420m is paid for using the shares caribbean cruise vacations of yeoHS at a premium and a small 58m in cash. Is it a good deal? I am not very sure but i dont think it is at a good price, at best, a fair price for a good business (assuming it is a good business).
money Wrote: The 3 assets sold generated 27m in profits for FY2011, they are sold for 702m (page 11 in the attachment below). but the problem here is it takes great optimism to sell at such a high price. Will you buy into such a reit with p/e around caribbean cruise vacations 26, i wouldnt. Moreover, the properties are not freehold.
Indeed, the valuation of 702m looks rich. As a reference, CDL H-Trust is trading at a 6% yield. This is likely why the REIT is selling as a "stapled security". Maybe they'll stapler Greek bonds together with this, to prop up the yield It's also possible that OPHL will pay higher than market rate for the leaseback as well.
(13-06-2012 02:30 PM) bluechipstamp Wrote: money Wrote: The 3 assets sold generated 27m in profits for FY2011, they are sold for 702m (page 11 in the attachment below). but the problem here is it takes great optimism to sell at such a high price. Will you buy into such a reit with p/e around 26, i wouldnt. Moreover, the properties are not freehold.
Indeed, the valuation of 702m looks rich. As a reference, CDL H-Trust is trading at a 6% yield. This is likely why the REIT is selling as a "stapled security". Maybe they'll stapler Greek bonds together with this, to prop up the yield It's also possible that OPHL will pay higher than market rate for the leaseback as well.
With some changes in market rate for leaseback, gearing and interest rate control in the first few years(like how the banks offer our condo crazy singaporeans), it should be possible to achieve a yield of 6% for the 3 hotels with the selling price of 702million.
(13-06-2012 02:30 PM) bluechipstamp Wrote: money Wrote: The 3 assets sold generated 27m in profits for FY2011, caribbean cruise vacations they are sold for 702m (page 11 in the attachment below). but the problem here is it takes great optimism to sell at such a high price. Will you buy into such a reit with p/e around 26, i wouldnt. Moreover, caribbean cruise vacations the properties are not freehold.
Indeed, caribbean cruise vacations the valuation of 702m looks rich. As a reference, CDL H-Trust is trading at a 6% yield. This is likely why the REIT is selling as a "stapled security". Maybe they'll stapler Greek bonds together with this, to prop up the yield It's also possible that OPHL will pay higher than market rate for the leaseback as well.
1) The operating profits generated from the properties should be higher in a REIT structure as a REIT does not pay income tax and it does not treat depreciation as an expense. Hence its cash earnings will be much higher and it is possible to attain 5 - 6% NPI yield.
2) Hospitality caribbean cruise vacations trust (like CDLHT) tend to exist as stapled securities ie a REIT + dormant business trust. The business trust is activated when the REIT needs an internal hotel manager to operate the Hotel when the tenant defaults or it chooses to undertake a development project on its own.
Disclaimer: Please feel free to correct any error in my post. I am not liable for anything. Do your own research and analysis. I do NOT give buy or sell calls and stock tips. Buy and sell at your risk. I am not a qualified financial adviser so I do not give any advice. The postings reflects my own personal thoughts which may or may not be accurate.
yeokiwi Wrote: With some changes in market caribbean cruise vacations rate for leaseback, gearing and interest rate control in the first few years(like how the banks offer our condo crazy singaporeans), it should be possible to achieve a yield of 6% for the 3 hotels caribbean cruise vacations with the selling price of 702million.
nick Wrote: Hospitality trust (like CDLHT) tend to exist as stapled securities ie a REIT + dormant business trust. caribbean cruise vacations The business trust is activated when the REIT needs an internal hotel manager caribbean cruise vacations to operate the Hotel when the tenant defaults or it chooses to undertake a development project caribbean cruise vacations on its own.