Why Wing Tai is indisputable local home developer

Its recent 187% profit jump is one among many reasons.

According to Maybank Kim Eng, Wing Tai started its FYJun13 on a bright note as it posted a 1QFY Jun13 net profit of SGD72.1m, which is a 187% YoY increase and 43% QoQ improvement (excl. revaluation gains in the last quarter).

1QFY Jun13 net profit already accounted for 44.5% of our fullyear estimate. The solid first quarter validates Wing Tai as our top pick amongst the local residential developers.

The earnings growth in Q1 was attributable to additional units sold in Belle Vue Residences and Helios Residences. Since the projects have already been completed, profits can be immediately recognized whenever additional units are sold.

For the rest of FY13, Foresque Residences and L’VIV will also contribute to the profits on a progressive basis. Two new projects for 2013. In 2013, Wing Tai will launch a new 337-unit project to be developed on the site of its old corporate HQ at Tampines Road.

Here's more from Maybank Kim Eng:

We expect the new development to have an ASP of around SGD1,350 psf. Wing Tai’s JV with Metro Holdings and United Engineers could also launch the project at Prince Charles Crescent at around SGD1,750 psf.

These two projects are likely to be the operational highlights for 2013. Wing Tai will be watching the high-end segment very closely to find a window of opportunity to launch its two projects at Ardmore Park, namely Nouvel 18 and Le Nouvel Ardmore.

These projects account for approximately 8% of our RNAV estimate for Wing Tai, based on our ASP assumptions of SGD3,150 psf and SGD3,600 psf respectively.

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