Prices of private residential properties continued to increase in 1Q23 by 3.3%, its 12th consecutive increase QoQ. Due to red-hot property prices, we expect more cooling measures to come. However, the recent cooling measures primarily target high-end/luxury properties with a greater proportion of foreign demand, rather than the mass and mid-tier segments that are predominantly sought by local buyers and SPRs. If this trend continues, CDL will be less impacted as its upcoming launches are mostly in the mid-tier segment (apart from Newport Residences).
Maintain ACCUMULATE with a lower RNAV TP of $8.33
We view CDL as proxy for the Singapore residential market and hospitality recovery. CDL is trading at an attractive 52% discount to our RNAV/share of S$15.13. Asset monetisation, unlocking value through AEIs and redevelopments, and faster-than-expected recovery in the hospitality portfolio are potential catalysts for CDL, which could help narrow the discount between CDL’s share price and RNAV.