DBS upgrades PropNex and APAC Realty to ‘buy’ amid strong pipeline of new launches in 2025

In 2025 to 2026, the analysts also see nonpublic resell transactions remaining “steady” at 13,500 to 14,000 units. Sell-through rates can average in between 30% to 50% during debut weekends, that can assist a gradual turnaround in profitability for both firms.

” We have transferred the multiple in the direction of +1 standard deviation (s.d.) (versus [a] five-year standard of 12 times), as the marketplace and the business’s profitability go to an inflexion point,” the analysts write.” [PropNex’s] FY2025/FY2026 dividend yield of 7.7% (80% payment percentage) is appealing, with potential upside if the team opts to disperse its cash reservations (16 cents per share) to stockholders.”

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Tan and Foo have raised their target rate quotes for both PropNex and APAC Realty to $1.15 and 50 cents from 95 cents and 48 cents respectively.

PropNex is the leading property company in Singapore with around 12,000 brokers accounting for 34% of the nation’s market portion. APAC Real estate is among the leading players in the property brokerage market. It has a visibility in 17 Asia Pacific (APAC) countries and among the largest brand presences in Asia with its ERA franchise network.

On The Other Hand, APAC Realty’s brand-new target cost represents a higher P/E multiple of 13 times in line with its four-year historical average on rolled-forward FY2025 earnings.

Their brand-new target price for PropNex is secured to 15 times the business’s P/E on rolled-forward and revised FY2025 incomes. PropNex’s FY2025 profits estimates were lowered to account for lesser entire sales and margins assumptions.

DBS Group Research has actually improved its claims on PropNex and APAC Real estate to “acquire” from “hold” as both counters are tipped to benefit from a strong pipeline of brand-new release in 2025.

” We foresee a bounce back in total volumes in 2025, driven by brand-new sales going back to [near] 8,000-8,500 units each year. This is assisted by stable property costs, with changes expected in the series of +1% to +2%,” claim Derek Tan and Tabitha Foo in both records dated Jan 6.

The rebound will mainly be pushed by 3 main variables: lower mortgage prices; home owners, upgraders and long-term residents getting homes for themselves; as well as the introduction of a wider selection of ventures with strong attributes.

” The group’s industry share in private new sales and resale has actually enhanced to 56% -60%, considerably greater than pre-pandemic ranks,” note Tan and Foo for PropNex specifically, adding that these amounts suggest that one in every 2 sales is made by a PropNex agent. With this in mind, a possible increase in market share as PropNex contributes to its sales force, would present upside potential to the analysts’ estimates.


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