OUE

OUE: Good set of 3Q12 results which was in-line. Rev at $102m, +18.2% yoy and +5.5% qoq, while net profit at $23.8m, +19.7% yoy and +4.3% qoq. Grp’s rev from property investments totalled up to $37.9m, +40.0% yoy on back of rental contributions from OUE Bayfront, where occupancy rate had increased yoy, and a one off penalty rent received in relation to another commercial building. Grp’s hospitality division recorded rev of $58.2m, +2% yoy with the increase mainly contributed by Crowne Plaza Changi Airport which was acquired in Jul11. Pty dev arm continues to sell more residential units at Twin Peaks, which has more than doubled its income to $5.9m in 3Q12. CEO note that grp continues to benefit from its well diversified portfolio of strategically located prime assets, coupled with asset enhancement and active leasing mgt strategy confident. Going ahead, grp aims to redevelop the DBS Building podium, the retail podium at One Raffles Place as well as the adjoining site of Crowne Plaza Changi Airport. These asset enhancements will increase and diversify income when completed. Separately, grp announced that it will declare its intentions for FNN by next Thursday (Nov 15). The announcement comes ahead of ThaiBev/TCC’s General Offer deadline slated for today. Overall, valuations are undemanding at 38% discount to RNAV and 0.79x P/B. Ratings as follow: Deutsche maintains Hold with $2.84 TP