PropNex - DBS Research 2022-11-11: Sustainable Demand & Stable Prices To Provide Support

PropNex - Sustainable Demand & Stable Prices To Provide Support

  • PropNex (SGX:OYY) reported a 17.8% y-o-y increase in 3Q22 net profit to S$18.2m, on the back of the 10.2% gain in revenue to S$258.4m. The bottom line was boosted by other income of S$5.8m (vs. S$1.5m in 3Q21), mainly due to an increase in advertising and marketing income and the derecognition of trade payables to agents. See PropNex's announcement dated 09 Nov 2022.
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  • PropNex saw an 11.8% increase in its salesforce headcount to 12,065 (as at 2 November 2022) from 10,796 salespersons since 1 January 2022.

8.2% increase in private home prices from January to September 2022; expect overall price increase of 9% to 10% for 2022.

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  • Transaction volumes for private residential resale will likely remain muted given the tight resale inventory. Private homeowners looking to downgrade to HDB resale flats may now also hold back due to the newly imposed 15-month wait-out period, further crimping available resale stock.
  • The latest cooling measures introduced on 30 September 2022 affect the loan quantum for HDB buyers, as well as potentially delay cash-rich private home downgraders from entering the HDB resale market. For the whole of 2022, PropNex projects that HDB resale prices could rise by a healthy 9% to 10%, slower than the 12.7% increase posted in 2021.
  • PropNex has secured marketing mandates for 35 projects to be launched in 2023, with a total of ~11,000 units. This should help to offset the depleting stockpile.

Expect a weaker 4Q22 and 1Q23, as the impact from recent cooling measures sets in.

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Above is the excerpt from report by DBS Group Research.
Clients of DBS may access the full report in PDF @

Lee Keng LING DBS Group Research | 2022-11-11

Read also DBS's most recent report:
2023-08-11 PropNex - 1H23 Results Below Estimates, Expecting A Better 2H23.

Previous report by DBS:
2023-03-01 PropNex - Riding On The Resilient Property Market.

Price targets by 4 other brokers at PropNex Target Prices.

Listing of research reports at PropNex Analyst Reports.

Relevant links:
PropNex Share Price History,
PropNex Announcements,
PropNex Dividends & Corporate Actions,
PropNex News Articles


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