CapitaMalls Asia

CapitaMalls Asia: Daiwa upgrades to Buy from Hold, noting that the sell-down of its shares has more than surpassed any potential deterioration in the underlying China retail-property sector but lowers its target price to $1.47 from $1.85. House trims its EPS forecasts by 10.5%-13.8% for 2011-13 to reflect lower rental assumptions due to slower 2012 GDP growth forecast of 8.5% vs 9.0% prev. Also factoring in a 30% discount to CMA's unlisted China-mall assets to account for rising supply risks, higher more prolonged start-up costs & the possibility that its business model is destroying value during the build-out phase. Adds that at the current share price, the market is already assigning no value to the China-mall business & estimates CMA would be worth about $1.21/share, assuming a zero value for the unlisted China-malls. The shares are currently +1.3% to $1.155.