Background: Global Logistic Properties (GLP) is a market leader in developing, owning, managing and leasing logistics facilities in China and Japan. It has a presence in 20 cities in China with 8m sqm of GFA, and seven cities in Japan with 2.8m sqm of completed GFA. The Government of Singapore Investment Corporation (GIC) has a 50.6% shareholding in the company.
Recent development: GLP recently raised RMB3b (S$570m) of financing, via its MTN programme, comprising RMB2.65b in 5-year notes at 3.375% fixed coupon and RMB350m in 7-year notes at 4% fixed coupon, underlining its strong credit standing.
Our view:
Strengthening foothold in China. Since its listing, GLP has announced two major acquisitions. The first is the strategic acquisition of a 19.9% stake in Shenzhen Chiwan Petroleum Supply Base Co, which in turn owns BLOGIS, the second-largest modern logistics facility provider in China after GLP. GLP then acquired a 53.1% stake in Airport City Development (ACL), the sole developer in the Beijing Capital International Airport airside cargo handling and bonded logistics area.
Riding the wave of domestic consumption. GLP is in the best position to capture the benefits of China’s economic transformation into a domestic consumption market. Demand for consumable products, automobiles and other durable goods will spur the need for highquality logistics facilities which are in short supply. Excluding land reserves, GLP’s China portfolio comprises 8.0m sq m in GFA, with an effective interest valuation of US$2.8b (S$3.4b).
Strong balance sheet to seek further growth. The RMB3b financing raised recently in the MTN programme will mainly go towards refinancing existing loans. As of 31 March, GLP’s net gearing stood at a comfortable 0.3x, allowing it the financial flexibility to seek new acquisitions. GLP targets to maintain 1.5-2 years’ worth of development starts in its landbank and will also consider acquiring third-party assets.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment