Asian Property Development
Crouching tiger Solid growth in FY12-13F supported by huge backlog and aggressive launch plan Stock has underperformed the sector, but a re-rating is imminent given strong growth ahead Re-iterate BUY with a revised TP of Bt6.37, pegged to 9.8x PE and i
Asian Property Development Plc (AP)
Aggressive plans for 2012. AP is targeting 39% growth in presales to Bt20bn and 26% revenue growth to Bt17bn in 2012. It plans to launch 19 projects worth Bt22.6bn, up sharply from 12 (4 condo and 8 low-rise projects), valued at Bt15.8bn last year. This year’s launches will comprise 6 condo, 2 detached house and 11 townhouse projects. It has secured land for these projects and for two more projects to be launched in 2014 and beyond.
Strong growth ahead. We estimate AP’s earnings will jump 21% this year and 40% next year. This will be supported by its huge backlog, existing inventory, and new launches.
Maintain BUY. The stock is now trading at 8.2x 2012F PE, which is below its historical average. AP is now our top pick for residential property, for its strong earnings growth outlook and attractive valuation. We raised our target price to Bt6.37, pegged to 9.8x PE and in line with its RNAV. The stock now offers 19% upside plus generous 4.9% dividend yield.
