Stock Buy Call: Ho Bee with price target of 1.3 by Westcomb

Westcomb Financial Group said it has initiated coverage on property developer Ho Bee Investment Ltd with a "buy" rating and a target price of 1.30 sgd per share. In a note to clients, Westcomb said Ho Bee's prospects were bright given its reputation as a luxury home developer on Sentosa, which will help facilitate sales of its future launches in the high-end and mid-tier residential segments. "We are of the view that there is further capital upside, of about 10 pct to 15 pct, in the high-end and mid-tier home markets over the next 12 months, " it said. Westcomb also said Ho Bee, currently the largest luxury home developer at Sentosa Cove, is a recommended play because it believes land surrounding the Sentosa integrated resort will appreciate in value, regardless of who wins the bid for the project. "With land acquisition plans in the pipeline that will further enhance RNAV (revised net asset value), and as the beneficiary of higher land values, regardless of the winning bidder for the Sentosa resort project, we are expecting a re-rating of Ho Bee shares," it said. Westcomb expects Ho Bee's net profit growing to 73.73 mln sgd this year from 38.07 mln last year, further rising to 154.02 mln next year. Ho Bee ended the morning up 0.03 sgd at 2.97 pct at 1.04 with 5.60 mln shares traded.