Wing Tai grabs crown as best performing property stock

Share price has surged 52.3%.

According to Nomura, since the end of June 2012, WINGT has gained 52.3% (vs. the FSSTI’s 13.1% gain over the same period) and has been the best-performing property stock under the firm's coverage.

Notwithstanding the outperformance in 2012, Nomura's estimates suggest the current share price is still pricing in a further decline of 25% in prime luxury home prices, which appears overly bearish.

Here's more from Nomura:

To be sure, the prime luxury housing market is still facing many headwinds. According to JLL’s latest estimates, prime luxury home prices fell 0.8% q-q (5.6% y-y) in 4Q12 and are now 13.6% below the 4Q07 peak.

In addition, there are still many unsold units in the prime residential areas (over 10,000 units in the CCR on our numbers). That being said, even units at Cliveden do not transact at 40% below their 2007 prices.

Moreover, even though it is still nowhere near the levels seen in 2007 (or even 2010), transaction volume of prime luxury homes that cost over SGD5mn each appears to be slowly picking up from the trough that followed the introduction of the Additional Buyers’ Stamp Duty (ABSD) in December 2011.