Chinese projects to boost Keppel's earnings by at least 60%

Thanks to its projects in Wuxi and Tianjin.

Keppel Corporation’s (Keppel) property earnings will largely come from China, as profits from property trading in the country can grow 60-85%, UOB Kay Hian said.

According to an analysis, this will primarily be driven by phased project launches from Tianjin Eco-city and secondary contributions from projects in Wuxi.

Moreover, if it manages to sell its projects in non-core cities in China, Revalued Net Asset Value (RNAV) could rise by 15 cents to $5.66 per share.

China's property cooling measures implemented earlier this year have impacted Keppel’s home sales.

This was most apparent in 3Q2017, where homes sales fell 48% YoY.

"However, its projects still retain pricing power, with prices remaining flat despite the measures. Sales continue at a steady clip, though the coming quarters will reveal whether this remains the case," said UOB Kay Hian analyst Foo Zhi Wei.

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