20140811-高盛-A_glance_at_the_Asia_property_market_11页_277kb

Asia Property Weekly Summary

Core Content Overview

This summary provides a comprehensive view of the Asia property market, highlighting key developments, performance metrics, and upcoming events across major regions including China, Hong Kong, Japan, India, and Singapore. It includes insights into residential and commercial property trends, valuation comparisons, and investment ratings.

Key News and Updates

China

• Residential Market:
  • In the second week of August, 20 cities with available data saw a decline in transaction volumes (median -7%), while 7 cities experienced a price decrease (median -5%).
  • 2 out of 5 residential plots in Beijing auctioned last week received no bids, the first time since April 2011.
  • A property taxation system is planned for submission to the National People's Congress later this year.
  • Survey results indicate a decline in home-buying sentiment in Shanghai, with a score of 96 (vs. 99 in May).

Hong Kong

• Residential Market:
  • 201 primary residential units were sold in the week ending Aug 10, a 45% drop from the 3-month average of 368 units.
  • Secondary market prices increased by 0.4% week-on-week as of Aug 3, indicating a 4.2% year-to-date increase.
  • The Urban Renewal Authority is re-tendering its Kwun Tong project, removing the HK$8bn upfront payment requirement.
  • The HK Government will hold a briefing on Aug 15 to announce economic data and revise the 2014 GDP projection.
  • A pilot scheme for land premium arbitration will release 6,000 units from 25 projects this month.
  • Residential plots in Tsuen Wan and Ma On Shan received 11 and 16 tenders, respectively, from developers.

Japan

• Residential Market:
  • Sanko Estate reported a -3.3% quarter-on-quarter decline in class A office rent in central Tokyo and a -0.8% drop in the vacancy rate.
• Economic Outlook:
  • Media reports suggest the Japanese economy may shrink by 7.4% annually in 2Q14 on a price-adjusted basis.
  • The government may disqualify unsafe housing from tax incentives starting April 2015.

India

• Residential Market:
  • Sobha Developers (SOBH.BO) reported a 14% year-on-year increase in net profit to Rs570mn in the June quarter.
• Real Estate Activity:
  • The "Feet on the Street" report noted increased activity in Mumbai's Central suburbs.

Singapore

• Residential Market:
  • A subsidiary of Chip Eng Seng Ltd won residential plots on Fernvale Road at S$438 and S$448 psf ppr.
  • HDB resale prices fell by -0.9% month-on-month in July, with a -7.8% decline from the April 2013 peak.
  • Resale volume increased by 2.0% month-on-month but decreased by 10.2% year-on-year.
  • The National Development Minister stated it is premature to relax property measures during the parliamentary session.

Upcoming Events

Performance and Valuation

Market Cap Weighted Price Performance

Top / Bottom 5 Performers of the Week

Top Performers:

• Unitech: 4% (1-wk), -8% (1-mo)
• Jaypee Infotech: 4% (1-wk), 9% (1-mo)
• Housing Dev. & Infra.: 3% (1-wk), 1% (1-mo)
• DA Office: 3% (1-wk), 10% (1-mo)
• Mori Hills REIT: 2% (1-wk), 3% (1-mo)

Bottom Performers:

• Greentown China: -17% (1-wk), -3% (1-mo)
• K-Wash Inc.: -9% (1-wk), -9% (1-mo)
• Mitsui Fudosan: -8% (1-wk), -7% (1-mo)
• Aeon Mall Co Ltd: -8% (1-wk), -17% (1-mo)
• Sumitomo: -8% (1-wk), -9% (1-mo)

Top Buy / Sell Ideas

Buy-related stocks (Market Cap > US$2bn):

• Country Garden: 71% upside potential
• Aeon Mall Co Ltd: 58% upside potential
• DLF: 50% upside potential
• China Resources Land: 48% upside potential
• Tokyo Tatemono: 44% upside potential

Sell-rated stocks:

• Gemdale Corp.: -22% downside potential
• Suntec REIT: -20% downside potential
• Advance Residence: -17% downside potential
• Champion REIT: -17% downside potential
• City Developments: -10% downside potential

Buy-related stocks (Market Cap < US$2bn):

• Sofa Developers: 39% upside potential
• Oberon Realty: 33% upside potential
• Presidium Estate: 19% upside potential
• Home Ins: 16% upside potential
• E-House: 10% upside potential

Key Research for the Week

• Longfor Properties Co. (0960.HK): Below expectations due to lower bookings and impairment loss.
• Jinmao Investments (6139.HK): Unique asset mix of hotels and stable rentals; initiated at Neutral.
• Franshion Properties (China) (0817.HK): Resumed with a Sell rating due to worsening risk/reward.
• Godrej Properties (GODR.Bo): Below expectations with low margins and increasing debt; Sell rating.
• Global Logistic Properties (GLPL.SI): Below expectations on FX; positive growth outlook matters more.
• CapitaLand (CATL.SI): In line with expectations; building momentum for next leg.
• Poly Real Estate Group (600048.SS): Buy rating due to the potential of the HK-SH Stock Connect to narrow discount vs. peer COLI.
• Prestige Estates Projects (PREG.BO): Buy rating due to equity fund raising for sustained high growth.
• Wharf Holdings (0004.HK): 1H14 preview; focus on margin trends and management guidance.

Analyst Information

• Anthony Wu: Goldman Sachs (Asia) L.L.C.
  +852-2978-0634
  anthony.wu@gs.com

Note: Goldman Sachs does and seeks to do business with companies covered in its research reports, which may affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decisions. For Reg AC certification and other important disclosures, see the Disclosure Appendix or go to www.gs.com/research/hedge.html.

Disclosure Appendix

• Source: Bloomberg, Datastream, Goldman Sachs Global Investment Research, Gao Hua Securities Research.
• Residential Market Data: Based on secondary market transactions in China, and primary market data for week-on-week trends.
• Commercial Market Data: Source includes Centline Property Agency, R&VD, China National Bureau of Statistics, China Index Academy, Jones Lang LaSalle, URA, Real Estate Economic Institute, Knight Frank, Goldman Sachs Global Investment Research.