SingPost – Lim and Tan

• The close yesterday is only 7 cents away from its peak of $1.30 reached in mid-07.

• The “boring” company has well outperformed SingTel, which still owns 25% of it: Sing Post started the year at $1.02 and Sing Tel at where it is currently ($3.10 yesterday).

• One development which we would not rule out is Sing Tel divesting or reducing its stake in Sing Post. (Sing Tel sold 95 mln Sing Post shares on Dec 12 ’05 at $1.107 each.)

• Any impact is however unlikely to be significant given that the overhang has not been an issue all these years. Besides, the stake worth almost $600 mln is of little strategic importance to Sing Tel, with a market cap of $almost $50 bln.

• The other development of likely significance is the government land tender in Eunos right next door to the Post Centre, which Sing Post had hoped to sell before being jettisoned because of the financial crisis. The land tender is expected before end 2010.

• Even if the stock were to drop on news of share placement by Sing Tel, a new “base” / support has been established at $1.13, the price at which SingPost has, between Aug 12th and 31st, bought back 8.597 mln shares. (All, except the buy-back of 1.968 mln shares on Aug 19th was at $1.12 a share.)

• We expect the 2007 peak to tempt some to take profit / sell. At $1.30, yield would be 4.8%.

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