Shares of Global Logistic Properties (GLP) had a sparkling debut on the Singapore Exchange (SGX) on Monday.
The stock rose 10.7 per cent on its first trading day to close at S$2.17, up from its offer price of S$1.96 a share.
GLP, a real estate unit of the Government of Singapore Corp (GIC), was also the most actively traded stock on SGX.
The counter saw a hefty 514 million shares changing hands, valued at S$1.1 billion.
Analysts remain upbeat on the stock’s prospects and they believe that the strong demand for commercial properties will help boost GLP’s earnings going forward.
“I see a further upside in terms of Asian properties, particularly in commercial property, mainly because of the strong (retail) interest and also because most of the rises have been on residential properties whereas commercial properties haven’t move up quite as much,” said Wong Sui Jau, GM of Fundsupermart.
Analysts said most Asian commercial properties are now trading at near or slightly lower than their book value, and based on their historical peak, they will usually rise to above book value during strong economic growth.
Coupled with Asian currencies’ appreciation and low interest rates for deposits, analysts said Asian property can be an alternative sector to invest in.
GLP’s initial public offering (IPO) which closed last Friday was nearly 12 times subscribed.
It ranks as the second largest IPO here after SingTel’s S$4 billion listing in 1993.
The unit of GIC raised about S$3.5 billion in gross proceeds through the sale of 1.76 billion shares.
GLP, which also has an over-allotment option of 234.6 million shares, will raise a total of S$3.9 billion in gross proceeds if the over-allotment option is exercised.
Source : Channel NewsAsia – 18 Oct 2010