DBS upgrades PropNex and APAC Realty to ‘buy’ amid strong pipeline of new launches in 2025
The recoil will mostly be generated by three major factors: reduced mortgage prices; house owners, upgraders and permanent individuals purchasing homes on their own; as well as the intro of a wider selection of ventures with solid qualities.
” We have moved the multiple in the direction of +1 standard deviation (s.d.) (versus [a] five-year average of 12 times), as the marketplace and the business’s profitability are at an inflexion factor,” the experts publish.” [PropNex’s] FY2025/FY2026 dividend return of 7.7% (80% payout ratio) is appealing, with potential benefit if the group decides to allocate its cash money reserves (16 cents per share) to investors.”
On The Other Hand, APAC Real estate’s new target price represents a higher P/E multiple of 13 times in line with its four-year historical standard on rolled-forward FY2025 incomes.
” We expect a rebound in total volumes in 2025, driven by brand-new sales returning to [about] 8,000-8,500 units yearly. This is assisted by stable property rates, with fluctuations assumed in the series of +1% to +2%,” claim Derek Tan and Tabitha Foo in both reports dated Jan 6.
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In 2025 to 2026, the analysts also see private resell transactions standing “stable” at 13,500 to 14,000 units. Sell-through rates could average between 30% to 50% during debut week ends, which can sustain a gradual turn-around in profitability for both firms.
an and Foo have actually enhanced their target price estimates for both PropNex and APAC Real Estate to $1.15 and 50 cents from 95 cents and 48 cents respectively.
DBS Group Research has upgraded its calls on PropNex and APAC Realty to “buy” from “hold” as both counters are tipped to benefit from a strong pipeline of new open in 2025.
Their new target rate for PropNex is pegged to 15 times the company’s P/E on rolled-forward and modified FY2025 earnings. PropNex’s FY2025 profits price quotes were lowered to represent lesser entire sales and margins presumptions.
” The group’s industry share in private new sales and resale has boosted to 56% -60%, significantly more than pre-pandemic levels,” note Tan and Foo for PropNex specifically, including that these figures show that one in every 2 sales is made by a PropNex agent. With this in mind, a prospective raise in market share as PropNex adds to its sales force, would certainly provide upside potential to the experts’ estimations.
PropNex is the biggest property company in Singapore with approximately 12,000 agents accounting for 34% of the country’s market portion. APAC Realty is just one of the major players in the real estate brokerage industry. It has a presence in 17 Asia Pacific (APAC) places and among the largest company footprints in Asia via its ERA franchise business affiliate.
