Oxley Holdings

Company background:
Only listed on Catalist in 2010, raising $82 million
Market cap now: $2.3billion
Founder Ching Chiat Kwong (a former policeman) owns
12.21% direct interest and deemd interest of 51% through an
investment vehicle
Well known for popularising shoebox apartment, often not
more than 300 sq ft in size
Aggressive expansion outside Singapore: in London (Royal
Wharf), Malaysia (eight projects), Cambodia (three projects)
and China (two projects)
Deputy CEO Eric Low (7.93% in Oxley) was former CEO of
Hafary Holdings

Article Summary:
Shares in Oxley have gained more than 40% in value since
started of the year
Oxley has gone from obscurity to a developer with 19
residential projects, 14 of which have been fully sold
It is also building five industrial properties and three
commercial towers with completion dates stretching to the
end of 2018
CEO Chings bets on shoebox and commercial buildings with
added amenities such as swimming pools and gardens are
paying of
Question: is the rally sustainable?
Yes. (1) Oxley has substantial developments overseas
(London, Cambodia, Malaysia, China). Reports said Oxley has
amassed projects worth RM10 billion ($3.86 billion) in gross
development value in Malaysia (Oxley Towers)

(2) Company is considering a spin-of of its property

development projects outside Singapore, which analysts
expect to be more profitable than the developments here.
(3) Company has reported spectacular results in last two
quarters. 2Q2014s earnings at $25.1 million doubled that of
the year before.
Maybe not. (1) Negative free cash flow stands at nearly $600
million, or some 50% more than year before. In other words,
its balance sheet is relatively strected compared to other
developers (this could be due to the amount of projects it is
undertaking relative to its size). Oxley issued six rounds of
debt last year, had around $2 billion in debt with debt-toassets ratio at 58% as at last December.
(2) Although P/E valuation remains cheap (seven times)
compared to peers such as Fragrance or CapitaLand, its P/B at
4.7 is much higher than theirs, indicating it could be
overvalued on a book value basis.
Voyage Research analyst expects Oxley to fetch $0.9 billion
gross profit from Singapore projects and $1.7 billion gross
profit from overseas. Earnings are estimated at $330 million
from $1.16 billion revenue for FY2014 ending June.