atans1

GLP: Foreign brokers love it

In China, Logistics on 30/11/2010 at 5:21 am

Global Logistic Properties (GLP), got  ‘buy’ calls from 4  brokers (3 foreign) last week. It is a “buy” because it is leading provider of logistics facilities in China.

It owns logistics facilities in China and Japan – Asia’s two largest economies – and may expand into other economies (GLP says it is ‘building the leading distribution facility platform in Asia) in the region, stands to benefit from Asia’s strong economic growth. In particular, rise of consumer spending in China will boost profits.

Citi has a target price of $2.78 for GLP. It noted that yields from the sector are typically higher than those from the retail and prime office property segments in fast-developing China, and that the logistics space does not face the high policy risks that GLP’s residential peers are exposed to.

Nomura has a $2.58 price target for the stock. UBS, has a $2.65 price target for the stock.

In addition to these points, DBS says: We derive an RNAV of $2.76 using a sum-of-the-parts analysis that captures the value of its underlying assets as well as potential re-investment opportunities from balance sheet deployment. Our TP of $2.76 is pegged at parity to RNAV. Key risks to investment stem from regulatory and policy as well as global economic conditions.

BTW GIC is its single-largest shareholder.

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