Page: 53 (PDF)
Table of Contents:

Policy environment should continue to stabilize ........................... 3
No significant new measures since late April 2011 ..................................................................3
Limited room for additional tightening by local govts .................. 4
Results of latest audit by Audit Bureau.....................................................................................4
Land sales proceeds are important for repayment of local government debts.........................6
Land sales revenues still important to local govts ......................... 8
Rising importance of land sales revenue to local governments................................................8
Land sales revenue made up 43% of total local government revenues in 2010.......................8
Slowing land sales in 2011 present challenges ............................ 12
Residential land sales revenue down 11% YoY in Jan-May 2011 ...........................................12
Local governments have been running fiscal deficits .................. 14
Most of the local governments have been running fiscal deficit.............................................14
New constructions to slow............................................................. 16
New construction starts/new investments seen slowing in 2H11..........................................16
Convincing valuations..................................................................... 18
A more stable policy environment should help trigger a valuations rerating...........................18
Discount to NAV.............................................................................. 21
Discount to NAV of individual stocks ......................................................................................21
PB & PE............................................................................................. 26
Price-to-book and P/E of individual stocks ..............................................................................26
Government policy summary ......................................................... 35
Policies on property sector .....................................................................................................35
Housing affordability analysis ........................................................ 44