DBS keeps ‘hold’ call on APAC Realty with ‘healthy’ 1HFY2022 but sees slower 2HFY2022

Marina Gardens Lane Residences Condo

APAC Realty closed at 69 cents on Aug 8, down 2.84% for the day.

While the volume of transactions for 1FHY2022 dipped, they were normally transacted at higher costs.

DBS calls the 1HFY2022 numbers “healthy and balanced”, as the property market has actually revealed its “strength” amid worldwide challenges thanks to solid need from both regional as well as international purchasers.

“Though demand continues to be solid, exceeding supply, specifically for the brand-new homes sector, this could be partially reduced by the obstacles of climbing interest rates, greater rising cost of living and also climbing land expense,” adds DBS.

APAC Realty’s revenue from agenting resale and rental deals went down for 1HFY2022 but was partly offset by better new home sales.

DBS, in its Aug 9 note, explains that there’s a time lag of 3 to 6 months prior to profits from transactions are scheduled. DBS is anticipating a slower 2HFY2022 for APAC Realty.

DBS Group Research has actually maintained its “hold” get in touch with APAC Realty with an unchanged target price of 67 cents, following a small revenues dip reported by the residential property firm for its 1HFY2022.
The firm, which operates the ERA franchise, prepares to pay an interim reward of 3.5 cents per share for 1HFY2022, standing for a payout proportion of 75%. Back in 1HFY2021, APAC Realty paid an extra unique dividend of 3 cents per share as well.

In the very first 6 months of 2022, the personal household market in Singapore saw a 30% y-o-y drop in purchase quantity, with the steepest drop from the higher-margin new houses section, which was down 40% y-o-y. The HDB resale sector also saw a 6.1% y-o-y decline in the exact same duration.