SCG

1.87%

$3.27 scentre group

I usually live in Beijing. I'm in Australia this year --for...

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desertredlion

392 Posts.

601

10/07/20

00:20

Post #: 45765792
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Originally posted by Sam s89: ↑

It does look undervalued when looking at price v book value. Book value is also a function of income that can be generated from each property.
In my opinion it is too bearish to think the book value would be slashed in half (which would bring it down to the roughly equal the SP which isn't neccessarily expensive even at that point)
A big question which the market is concerned about is the gearing and what effect a significant write down of assets has on their debt covenants.
A capital raising is still a risk and it would be especially dilutive at these SP levels.

Another risk is that some of the anchor tenants are in trouble.. i.e. myer &DJs.. so how much value is lost if they disappear?

Overall in my view, the stock has been beaten down with the widely adopted thematic that physical retail is becoming redundant - which I don't buy (may change to being more showroom style - but physical front creates marketing value and gives the brand clout and visibility whilst capturing people that may not usually come accross it).
Never the less over 40% of scentre's tenants now are 'consume on site' places.. eg. Restaurants, gyms, health, entertainment - that will resume as normal with re-opening.
And ultimately, if the centres continue to generate foot traffic, then the tenancies will remain attractive to businesses looking to capture it.

In relation to foot traffic - with more people working from home, there is more of a desire to get out of the house and westfield centres are an attractive option for this. We have seen that play out with crowds in the centres over the last few weeks.
(Although may be hampered by going back into lockdown in the short term, and will remain a volatile 'risk' stock during this period)

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I usually live in Beijing. I'm in Australia this year --for obvious reasons. In Beijing, where online shopping and internet services dwarfs anything we've got in Australia, I've noticed that purely online companies and websites are starting to set up shops in malls. Presumably it gives them a physical presence and respectability as well as a service point and good advertising opportunities. Everyone buys everything online there....but the malls are always packed with people

SCG Price at posting: $2.12 Sentiment: Buy Disclosure: Not Held
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(20min delay)
Last $3.27		Change 0.060(1.87%)		Mkt cap ! $16.98B

Open	High	Low	Value	Volume
$3.25	$3.30	$3.24	$24.75M	7.572M

Buyers (Bids)

No.	Vol.	Price($)
3	159286	$3.26

Sellers (Offers)

Price($)	Vol.	No.
$3.27	3651	1

View Market Depth

No.	Vol.	Price($)
1	15550	3.250
1	15550	3.230
2	2003	3.200
1	14132	3.190
2	19132	3.180

Price($)	Vol.	No.
3.290	1000	1
3.300	8603	3
3.310	17644	3
3.320	14132	1
3.330	15632	2

Last trade - 16.10pm 12/07/2024 (20 minute delay)

SCG (ASX) Chart

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