Roxy Pacific - undervalued

sumer, your numbers are good! we however were talking about different points. i was referring to why DBS V came up with a RNAV of 63 c while the official RNAV is 47.33 c. The jump from (47.33 to 63) didint come massively fr DBS V\'s revaluation of the hotel. After all, DBS V valued it at $245.5 m versus Roxy\'s $232.4m, which is only 6% higher. The jump fr 47.33 to 63 came from the inclusion of profits from pre-sold projects & unlaunched ones, etc which Roxy didnt include.

Which is better -- Roxy or Heeton? Under-valuation Roxy\'s RNAV: 0.63 Price: 0.36 P:RNAV : 1 : 1.75 Heeton\'s RNAV: 1.16 (from Westcomb Report) Price: 0.5 P:RNAV : 1 : 2.32 Debt Risk Roxy\'s Debt: 250m Equity: 133m Equity: Debt : 1 : 1.88 Heeton\'s Debt: 351m Equity: 180m Equity: Debt : 1 : 1.95 Simplistic Conclusion Heeton seems to be more under-valued and slightly more risky compared to Roxy.

As stated in the DBS report, the NPV of future earnings (from sold and unsold projects) is $83.6m or 20.8% of RNAV(or 13.14ct out of the 63ct RNAV per share). The hotel makes up $245.5m or 61.5% of RNAV(or 38.7ct out of the 63ct RNAV per share).

Roxy has stepped out of its niche of being a developer of niche developments - now progressing into the big league. Singapore, April 5, 2010 - Roxy-Pacific Holdings, through its wholly-owned subsidiary RL Properties Pte. Ltd., together with Macly Capital Pte. Ltd., Pinnacle Assets Pte Ltd, Fission Holdings Pte. Ltd. and Mr Chee Hsian Sing, have formed a consortium with equal shareholdings of 20% each. Together, the consortium has announced that they have successfully acquired the option to purchase Marina House at 70 Shenton Way for a total consideration of S$148.0 million. Marina House, owned by the Hong Leong Group, is situated on a land area of 1,833.5 sq m and comprises of a 4-storey podium and a 17-storey office tower. It has a gross floor area of 199,691 sq ft and a land tenure of 99 years with effect from June 2, 1970 (unexpired lease of 60 years). The prime site has obtained planning permission for the proposed erection of a 42-storey residential apartment block with commercial space on the 1st storey.

It\'s not a given that Marina House will be redeveloped. Roxy consortium is seeking govt OK to top up the lease from 60 years to 99 years. If the govt does not agree, then Roxy consortium will not redevelop the property into a luxury residential cum commercial project. The Marina House remains what it is, yielding rental income for the consortium. That doesnt sound too exciting, does it?

Record Q1 profit & revenue. I think can easily expect record quarters for the rest of the year. But what would it take for this Roxy to fly?