In today’s briefing:
- Oversea-Chinese Banking Corp (OCBC SP): The S$800M Swing Factor, Capital Return Optionality in FY26
- City Developments Limited — Value Unlock: RNAV Discount Narrowing as Boardroom Overhang Clears
Oversea-Chinese Banking Corp (OCBC SP): The S$800M Swing Factor, Capital Return Optionality in FY26
- Management confirmed ~S$800m still unutilised under the buyback programme may convert to a special dividend by end-FY26 — a dated, binary catalyst the market has partly but not fully priced.
- 1Q26 net profit rose 5% YoY to S$1.97bn, 5% above consensus: a 34% jump in wealth fees and record non-interest income offset 28bp of NIM compression to 1.76%.
- Our fair value of SG$29.50, derived by Gordon Growth implies 7.5% UPSIDE potential, which is normal, but combined with DPS it spikes to ~11% upside potential.
City Developments Limited — Value Unlock: RNAV Discount Narrowing as Boardroom Overhang Clears
- CDL trades at a 61% discount to its own FY2025 reported RNAV of S$20.16/share, versus a large-cap developer peer average of ~45% and UOL Group’s ~41%.
- The FY2025 boardroom dispute has substantively cooled: ~S$2bn of contracted divestments, led by the S$465m South Beach stake sale, funded deleveraging and a newly formalised ≥35% PATMI dividend policy.
- We believe financial performance will continue to impress with sustained asset recycling and potential special dividends. Our S$10.00 TP is based on 0.50x RNAV (+26% UPSIDE potential).
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