LHN: Official Green Light for Co-Living Spin-Off Powers Stock to Record Highs

THE CONTEXT • Less than 6 months after its April announcement that it planned to spin off its co-living business, LHN Group has received the SGX go-ahead for a mainboard listing.  And LHN's stock has reacted positively to the news, going past $1.00 today (all-time high) from the 40-cent level just prior to the April announcement.  • Analysts have turned upbeat with CGS International raising its target price to $1.20 (previously $1.00) while Phillip Securities, $1.13 (previously 61 cents). 2025 is LHN's 10th year of listing on the SGX. LHN's executive chairman and group MD, Kelvin Lim, is a controlling shareholder. His sister, Jess Lim, is LHN's group deputy MD.  • The spin-off essentially raises funds for LHN to expand the remaining businesses, including its Work+Store segment which provides storage and workspaces mainly for small businesses and individuals needing flexible, secure solutions for warehousing, order fulfilment, and workspace needs in Singapore.     • Read excerpts of the CGS report below ... (There's a link to the Phillip Securities report at the end of the article).

Excerpts from CGS report
Analysts: TAN Jie Hui & LI Jialin

SGX has confirmed LHN’s co-living business Coliwoo Group’s eligibility for listing on the Mainboard, valid for three calendar months from 9 Sep 2025.

With high residential rental rates in Singapore, budget-conscious foreign students and professionals are turning to co-living. Short-term visitors also find co-living attractive but Coliwoo has to constantly seek an influx of new customers.

We believe Coliwoo is on track for an early-Nov IPO (market cap: S$257-359m; 25-35% free float).

This follows LHN’s planned delisting from the Hong Kong Stock Exchange (estimated to be completed in Oct 2025).

Proceeds from Coliwoo’s listing are expected to support LHN’s expansion in its space optimisation and facilities management businesses.

Meanwhile, we expect LHN to add 300-400 more Coliwoo keys in 4Q25F, in line with its target of acquiring 800 new keys annually.

We believe LHN will accelerate its Work+Store growth plans now that selfstorage is permitted on selected industrial sites (e.g. in Bishan, Clementi, and Tampines), following JTC’s lifting of a temporary suspension in Apr 2025.

In our view, management may also explore M&A opportunities to accelerate growth of its facilities management segment and strengthen its recurring income base.

Additionally, management is evaluating potential dividend options, targeting a higher yield of 3-4%, supported by a stronger balance sheet and value-unlocking from the Coliwoo IPO.

On 31 Jul 2025, the group completed the sale of its wholly-owned subsidiary holding 115 Geylang Road for S$25.8m, with net proceeds expected to be c.S$15m.

The sales processes for 471 Balestier Road and 404 Pasir Panjang Road are ongoing.

We believe LHN may consider divesting more mature assets to unlock capital for growth.

Moving forward, we expect LHN to also target larger properties — 100 to 150 keys or more — under master leases to achieve better economies of scale for its Coliwoo business.

Reiterate Add, with a higher TP of S$1.20 We reiterate our Add rating on LHN, as it remains well-positioned to benefit from Coliwoo’s continued growth and the potential value unlocking to support expansion in LHN’s other key segments. "Our target price increased to S$1.20, as we roll forward our valuation to FY27F, still based on a 10x P/E, in line with its 10-year average." -- CGS analysts Tan Jiehui (above) & Li Jialin. We revise FY26-27F core EPS by -0.5% to 2.1%, mainly to account for lower interest cost assumed for FY26-27F (from 4% to 3.75%), offset by lower-than-expected operational Coliwoo keys in FY27F. Our target price increased to S$1.20, as we roll forward our valuation to FY27F, still based on a 10x P/E, in line with its 10-year average. Re-rating catalysts: potential M&As, and special dividends. Key downside risks: falling occupancy and/or rental rates, as well as limited availability of suitable acquisition targets.

→ Full CGS report here  → Phillips Securities' report is here.  → For background, see: Coliwoo's Big Leap: Why LHN's Co-Living Brand is Getting Its Own Listing