CapitaLand

UOBKayhian on 18 Feb 2015

FY15F PE (x): 23.9
FY16F PE (x): 22.5

Results in line with expectations. CapitaLand reported 4Q14 net profit of S$409.4m, bringing its 2014 PATMI to S$1160.8m, up 38% yoy. This was driven by improved operating performance from the shopping mall segment and development projects in Vietnam in addition to profit from the sale of Westgate Tower (S$123.5m), as well as lower funding costs. Excluding exceptional items, core Operating PATMI of S$705.3m is in line with our expectations, accounting for 103% of our full-year forecast. Increased focus on expanding private equity funds. CapitaLand Fund Management will expand its current assets under management (AUM) of S$18b in conjunction with 4-5 new potential partners to come on board. Management has added that these potential candidates should be well-versed with CapitaLand’s strategic business model. Maintain BUY with an unchanged target price of S$4.08, pegged at a 20% discount to our RNAV of S$5.11/share. The stock is currently trading at a deep 30% discount to its RNAV.