With property listings gathering pace in Singapore, it could be an opportune time for Singapore Post to spin off some of its post office assets, OCBC Investment Research said.
Singapore Post has a property portfolio, consisting of 16 potentially saleable post offices, that may bring in substantial cash when unlocked, OCBC said. It has a 'buy' rating and target price of S$1.14 on the company.
Shares of Singapore Post were flat at S$1.06 and have gained 13.4 percent so far this year, compared to the FT ST Industrials Index's 17.7 percent rise.
The brokerage added that its crown jewel, Singapore Post Centre, currently used for industrial office and retail purposes, is worth S$756 million, but could increase to about S$1.56 billion if it is converted to full commercial use.
"With current high property prices in Singapore, an increasing number of companies have listed their property assets due to favourable valuations," said OCBC.
Singapore has seen several initial public offerings of property assets, including Ascendas Hospitality Trust and Far East Hospitality Trust's $575 million IPO.
1155 (0355 GMT)
(Reporting by Charmian Kok in Singapore; email@example.com)