OCBC downgrades UOL Group to Hold

There is limited exposure to a still healthy mass-market residential segment, says OCBC.

Here’s more from OCBC Investment Research:

UOL has a strong track record of timing the property cycle well with spot-on execution at launches and we think this is a key strength of the company. Also, the group’s balance sheet is relatively healthy (cash S$334.2m and net gearing 33% as of end 1Q12) against potential macro-economic shocks from residual European uncertainties.

However, we are cognizant that there is limited exposure to a still healthy mass-market residential segment for the remainder of FY12. Downgrade to HOLD with an unchanged S$4.80 fair value estimate (30% discount to RNAV).