What will Perennial reap with its seeds in China's eldercare homes?

It will have access to 11 facilities.

Perennial Real Estate Holdings Ltd. already has its eyes on expanding its healthcare segment in China by branching out to eldercare homes.

According to a report by DBS Group Research, after its recent acquisition of 49.9% in Shanghai Renshoutang (RST) for $148 million, Perennial will have access to 11 eldercare facilities with over 2,400 beds and four pharmacies, each with dedicated traditional chinese medicine clinic.

More so, Shanghai RST has also committed
pipeline of over 5,700 beds and pipeline under negotiation of 16k beds in locations in Yangtze River Delta Region in the next few years.

"We believe this is a strategic acquisition to expand its healthcare segment via eldercare homes to benefit from an ageing population in China.

Post the acquisition, Perennial will be the largest single shareholder of RST followed by its founder.

However, DBS noted that while they remain positive on the group's long-term healthcare plans in China, its execution remains at risk.

Meanwhile, the group claims that the said acquisition will have around 13.2% positive impact on net profits.