Property markets have their ups and downs, but there’s something to be said for receiving cash flow every month.

This is especially true for commercial property which in general, has higher returns and occupancy rates than residential real estate. Singapore property has a certain kind of stability which is hard to find elsewhere in Asia.

Singapore, the smallest country in the ASEAN region, had a rough time since 2015 with property values sliding downhill.

However, the lack of space on the island along with its business-friendly policies, wealth (one in six households in Singapore are millionaires), and strategic location bode well over the long term.


Singapore Property Values Drop, Fundamentals Remain

The global population will hit 9 billion in just 20 years, more than a 25% increase from the current population. Because of this, there’s little uncertainty about real estate prices rising in small, wealthy city-states such as Singapore, Monaco, and Hong Kong.

For Singapore specifically, it’s just a matter of when. The nation is now facing a decrease in property prices. However, demand is on an upward trend with sales surging to a two year high.

A lack of land supply in the city-state means that demand will inevitably drive prices upwards.

The current fall in real estate values have led share prices of many property investment and development companies in Singapore to drop. InvestAsian believes some of them are undervalued.


Sinarmas Stock: A Global Real Estate Firm

Sinarmas Land (SGX:A26), originating in Singapore, is engaged in the property business through operations in Indonesia, China, Malaysia, and Singapore. They have long-term investments in major commercial buildings, hotels, and resorts.

The firm aims to become Southeast Asia’s leading property developer. With over 40 years worth of experience in the field, Sinarmas Land has the knowledge and ambition to capture growth in ASEAN.


A Top Performer in the Singapore Property Sector

Sinarmas Land boasts a secure structure on its balance sheet. The firm has a current ratio of 3, well above the industry average, and an approximately equal proportion of liabilities and equity.

The company is in no danger of going into default and in a great place for further growth.

Financial performance is also well above the industry norm. A gross margin of 71.3% and net profit margin of 52% means the company has done well – and it’s rewarding shareholders accordingly. Sinarmas stock has a P/E of just over 6 and superb cash flow.

Currently sold at a shadow of its former price which peaked at 0.8 SGD in 2015, Sinarmas stock is a buy. InvestAsian believes it will gain back its loss and more.

Want to buy stocks in the Lion City? Here’s three of Singapore’s highest yielding dividend stocks.

Skip the Next Western Recession

Learn the best places to invest – and where to avoid – by downloading our free Investment Cheat Sheet.

About Reid Kirchenbauer

Reid Kirchenbauer is the Founder of InvestAsian. He's an accomplished stock trader and property investor in Thailand, Cambodia, and many other places. He's been featured in publications such as Forbes, Nomad Capitalist, Property Report, and Seeking Alpha. Download his free investment guide by clicking here.

You Might Also Like

Share This