United Engineers

United Engineers: 3Q12 results broadly inline. The absence of devt profits for another quarter resulted in stable 3Q earnings, largely unchg from last qtr (+1.5% qoq). Earnings plunged yoy due to devt profits recognized in the corresponding period last yr – an accounting issue. Going forward, CIMB expects devt profits to kick in as early as 4Q12, from the fully sold Austville Residences (EC) and Eight Riversuits (41% sold), while recurring earnings will strengthen with contributions form UE BizHub East. The house keeps its Outperform rating with TP marginally lower at $3.13 (from $3.14). Says at 40% discount to book, the stock remains one of the cheapest developers. See potential for strong re-rating as the co holds on to $1.7b of quality assets that could be potentially divested or redeveloped. The 100th yr commemorative interim dividends remain a possibility for FY13.