Keppel announced yesterday that it has agreed to acquire for IDR400.8b (S$42.0m) a three hectare residential site in West Jakarta, Indonesia. The site is located along the Jakarta Outer Ring Road, and is a 15-minute drive from the Soekaeno-Hatta International Airport and 12 km away from IFC Jakarta, Keppel Land's Grade A commercial development in the city centre. We understand that the group expects to develop this site into a condominium project with ancillary shophouses for sale. We are overall positive on this deal as it deeps Keppel Land's exposure in Indonesia, a key emerging economy, though limited impact to RNAV is expected from this deal. We continue to like KPLD for its strong balance sheet and diversified exposure across property segments and geographical markets. Maintain BUY with an unchanged fair value estimate of S$4.09 (30% discount to RNAV).

Source: OCBC Research - 22 Jan 2014