OSK Research is upgrading its recommendation on property sector to neutral from underweight in view of the possibility of certain investors having already bought into 2010 valuations.
‘Despite the upgrade, we still believe that a moderate correction in property stock prices is inevitable in the short term,’ it said in its research note here yesterday.
As most of these stocks are already trading close to their 2010 fair value anyway, the current risk-reward ratio appears to be unfavourable and as such investors are generally advised to accumulate only after a meaningful price correction, it added.
‘The rally in property stocks from the March 2009 lows caught us by surprise as we had initially thought that such a rally would only take place in early 2010 when the market would be likely to aggressively accumulate property stocks 12 months ahead of the 2011 upcycle,’ OSK Continue reading
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