City Developments (“Citydev”) is at a turning point in 2025—unlocking shareholder value through disciplined
capital recycling, robust residential performance, and an attractive valuation. With recent divestments, a strong
launch pipeline, and upgraded earnings forecasts, we see compelling upside potential.

Strategic Asset Divestments: Unlocking Capital for Growth

• S$1.5b divestments YTD, underscoring proactive capital recycling.
• South Beach: 50.1% stake sale; expected S$465m divestment gain in 2H25.
• US asset rationalisation: Millenium Hotel St Louis sold (Jul 2025); Comfort Inn Near Vail Beaver Creek contracted for sale.

Proceeds are being redeployed to reduce gearing and pursue higher-yielding opportunities—strengthening the balance sheet and positioning the group for sustainable growth.

Residential Sales: Robust Momentum & Pipeline

• 1H25 sales: 903 units in Singapore worth S$2.2b.
• Key completions: Copen Grand EC (Apr 2025), CanningHill Piers, The Orie, The Myst, Norwood Grand, Union Square Residences.
• Launch pipeline: 2,260 units—Zyon Grand (706 units, 4Q25) and Lakeside Drive (570 units, 3Q26).
• Stabilised portfolio: Singapore office & retail occupancy ~97%; UK/Japan living sectors 80–95% take-up.

Hospitality: Near-Term Pressures, Long-Term Discipline

• 1H25 hotel revenue down 1.5% YoY despite a 0.5% RevPAR rise.
• PBT: S$84m loss on USD depreciation, financing costs, and inflation.
• Mitigation: supplier diversification, variable cost controls, and deferred non-essential capex.

Valuation: Discount to RNAV with Re-Rating Potential

• FY25–27F EPS upgrades: +4% to +233% (divestment gains, faster sales at The Orie).
• Target price: S$8.97 (~45% discount to RNAV).
• Current valuation: ~0.62x FY25 P/BV—inexpensive vs. peers.
• Technical momentum: Sideways near S$6.93, break above S$6.85 resistance; near-term targets S$7.15 and S$7.50 (~8% upside).

Why Citydev Stands Out

• Proactive capital recycling strengthens financial flexibility.
• Strong residential engine underpins earnings visibility.
• ESG commitment supports long-term resilience.
• Attractive valuation plus earnings upgrades set up a re-rating story.

Key Catalysts

• Potential interest rate cuts
• Accelerated asset recycling
• Stronger-than-expected sales momentum

Risks

• Sluggish macroeconomic growth
• Property cooling measures dampening demand

Conclusion: A Conviction Buy

Citydev is executing on divestments, residential momentum, and disciplined capital management.
With a solid launch pipeline, upgraded earnings outlook, and supportive technicals, we reiterate:
Buy Citydev.

Price Targets: Near-term S$7.15–S$7.50; long-term re-rating potential toward S$8.97.