Broker Name: UOB Kay Hian
Date of Report: Wednesday, 22 April 2026
Excerpt from UOB Kay Hian report.
Report Summary
- Stock Focus: Hong Leong Asia (HLA SP)
- Actionable Call: BUY (Maintained)
- Target Price: S\$4.90 (upgraded from S\$4.71)
- Upside Potential: 54.6%
- Key Idea: HLA’s acquisition of Yong Tai Loong (YTL), a reputable HDB-approved household shelter supplier, is immediately EPS-accretive and priced attractively at 4.3x PE. The acquisition enhances HLA’s earnings visibility amid Singapore’s robust HDB construction upcycle, targeting 55,000 BTO units by 2027.
- Earnings Impact: Forecasts for 2026-28 raised by 6-15% due to acquisition accretion. 2025 pro forma EPS rises 18.6% post-deal.
- Valuation: HLA trades at inexpensive multiples (2027F PE 15.5x, EV/EBITDA 7.6x; ex-cash PE for 2026 is 11.5x), delivering a projected ROE of 12.4%.
- Risk Factors: Commercial vehicle demand and construction cost volatility, but net cash position offers resilience.
Ticker: HLA SP
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