Stock Name: CapitaComm
Company Name: CAPITACOMMERCIAL TRUST
CIMB in a July 15 research report says: "2Q11 results met expectations, at 25% of our FY11 forecast and consensus estimate. Despite a 15bp cap-rate compression for its Grade-A assets, operational indicators continued to decline with revenue down 9.2% y-o-y on negative rental reversions from 6BR and OGS.
"This trend is expected to persist in 2H11 with expiring leases locked in at peak levels in 2008. Plans for MSCP redevelopment have been finalised with CCT potentially gaining full stakes by 2015. However, the DPU uplift is also not expected until then.
"We raise our DDM-based target price by 7% to $1.46 (8% discount rate) to account for this. Valuations (1x P/BV), with limited near-term catalysts in sight for organic growth in the next 6-12 months. MAINTAIN UNDERPERFORM."
Company Name: CAPITACOMMERCIAL TRUST
| Research House: CIMB | Price Call: SELL | Target Price: 1.46 |
CIMB in a July 15 research report says: "2Q11 results met expectations, at 25% of our FY11 forecast and consensus estimate. Despite a 15bp cap-rate compression for its Grade-A assets, operational indicators continued to decline with revenue down 9.2% y-o-y on negative rental reversions from 6BR and OGS.
"This trend is expected to persist in 2H11 with expiring leases locked in at peak levels in 2008. Plans for MSCP redevelopment have been finalised with CCT potentially gaining full stakes by 2015. However, the DPU uplift is also not expected until then.
"We raise our DDM-based target price by 7% to $1.46 (8% discount rate) to account for this. Valuations (1x P/BV), with limited near-term catalysts in sight for organic growth in the next 6-12 months. MAINTAIN UNDERPERFORM."
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