Guess which bank is forecasting 22-26% declines in property prices? Instituted downgrades for Keppel Land and Capitaland? Predicting a 34% drop in stock market prices? Why it’s none other than CIMB, that paragon of Malaysian banking that - prior to Najib’s ascension to the PM-hood was hardly on anyone’s radar – has now issued a highly social-media friendly press statement that will guarantee lots of awareness, discussion, sell-calls and possibly some white paint on CIMB office walls from already-anguished ProxNex or ERA employeees.
From Asiaone “CIMB Research downgrades Singapore’s property sector“
SINGAPORE – CIMB Research downgraded Singapore’s property development sector to underweight from neutral on Tuesday, citing weaker economic and jobs growth as a recession in 2012 becomes highly likely.
“We believe these indicators will precipitate in falling housing demand and office rents,” said CIMB in a report.
It is projecting a 22-26 per cent decline in capital values for both segments in 2012, and estimates property “stocks still has a 34 per cent downside to first quarter 2009 trough levels.”
The brokerage has lowered its rating for Keppel Land to underperform from outperform and cut its target price to S$2.15 from S$3.90.
Keppel Land, which has 23 per cent of its gross asset value from China, may see some share price overhang due to a potential broad-based slowdown in China’s property sector, CIMB said.
It has also downgraded Southeast Asia’s largest developer CapitaLand to neutral from outperform and lowered its target price to S$2.51 from S$3.62, to reflect higher risk premiums due to its China exposure.
However, CIMB noted that CapitaLand is in a stronger financial position in this cycle to tap on acquisition opportunities.
everyone knows that m’sia forever sees S’pore as the biggest economic threat and so when S’pore loses, m’sia will gain.