SINGAPORE (July 24): While the recent cooling measures should further slow down project sales for Wing Tai, the property group has been prudent, winning only a single land parcel in the current cycle.

In the current en bloc cycle, Wing Tai, along with its JV partner, won a land parcel in Serangoon North Ave 1, for $965 psf ppr last July.

Although the bid was higher than implied land cost compared to other en blocs in the vicinity, this was the only land parcel won during the cycle which limits Wing Tai’s exposure to any potential slowdown from recent cooling measures.

According to URA’s figures, 193 of 469 units have been sold in The Crest while another 113 units are listed under resale category. In the 43-unit Le Nouvel Ardmore, 10 units have been cleared including resales. As for the 613-unit Garden Residences, 66 units have been sold so far.

Wing Tai’s unsold GDV (gross development value) is estimated at $1 billion, most of it accounted for by Le Nouvel Ardmore and management has promised to maintain its pricing even if the takeup rate is slow.

Meanwhile, Wing Tai continues to maintain low gearing. As of March, its balance sheet was in net cash position. This would allow it to maintain pricing discipline and opportunistically expand its portfolio.

Based on estimates by research house Jefferies, GDV of Singapore residential properties account for about 20% of asset exposure and most of it from high-end project Le Nouvel Ardmore.

And although retail revenue has declined over the last five years, operations have been profitable since 2016 as footprint, portfolio brands and distribution channels were rationalised.

Since Sept 2016, Wing Tai has acquired two office buildings in Melbourne and two data centres in Melbourne and Sydney. It had also announced a fund management platform in Feb 2016.

“The stock trades at 0.5 times FY189F book of $4.11 and privatisation prospects are likely to keep the counter well bid,” says Jefferies analyst Krishna Guha who is maintaining its “buy” call with a $2.40 target price.

As at.12.26pm, shares in Wing Tai are up 2 cents at $2.13.