WiseVest - Upgrades on Capitaland

UBS and Citigroup have both placed an upgrade on Capitaland with both raising their target price to S$5.00 and S$5.08 respectively. With the impending delisting of Raffles Holdings after its sale of the Raffles City stake to CapitaCommercial Trust (CCT) and CapitaMall Trust (CMT), Capitaland is expected to receive up to S$900 million. This would increase Capitaland's cash hoard to around S$2 billion which Capitaland could utilize in regional projects and the Singapore Integrated Resort (IR). A report announced that Capitaland's tie-up with MGM Mirage should have the largest war-chest for the bid in SIngapore's IR and financial strength is a 10% consideration for the winning bid.

On top of that, the company has many strategic ventures with regional companies like Sun Hung Kai Properties (SHKP), one of Hong Kong's largest property developers, and Wal Mart in China. Analysts are even citing the possibility of Capitaland having another tie-up with MGM Mirage in Macau should their tie-up succeeds in Singapore. Increasing consolidation within Capitaland's assets which includes Ascott should also benefit it strongly. With all these points considered, Capitaland seems to be a good buy to keep for the long run.