Yanlord

Yanlord: Deutsche maintains Sell but increase TP to $1.00 from $0.93 on margin compression. Notes that high margin Shanghai projects are gradually running out and previous strategy of maximizing margins from a handful of projects will need to be adjusted. Results were in line with expectations, 1H12 rev of Rmb3.2b on lower GFA at 144.7k sqm. Net gearing declined from FY11 end of 51% to 44%. Margin compression continued to occur with gross margin falling another 2.6% pts to 35.1%.