- We initiate coverage on SGX-listed real estate management company LHN (SGX:41O) with BUY and a 12-month target price of S$0.54, based on an undemanding 8x FY24E P/E. This represents a steep discount to other bigger hospitality players’ average of 15x.
LHN – Investment Thesis
Market leader in co-living space
- - Read this at SGinvestors.io -
- Within four years, Coliwoo is now the market leader with ~20% of the total co-living supply in Singapore, followed by The Assembly Place (16%) and Bespoke Habitat (12%). Other notable players include Hmlet, Cove, Dash Living and Myposhpad. In addition, the presence of co-living brands that are backed by developers or hospitality groups contributes to stiff competition in the local market (e.g. lyf by The Ascott).
Moving towards asset-light strategy
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- As a result, LHN can maximise its growth momentum and quickly build up its market share amid rental and hotel rate hikes in FY21-22, without overstretching its balance sheet. Moreover, we expect LHN to continue its asset light strategy in coming years, thus generating faster growth than other co-living players.
Firing on all cylinders
- Read more at SGinvestors.io.
