CapitaLand

CapitaLand: 1Q13 broadly inline. Excluding one-off gains of $55m mainly from the sale of a residential site in Beijing, core net profit was $133m, +70% yoy, +20% qoq. This was driven by contribution from CMA, as well as devt profits in Singapore and China. Focus will be on the strong residential sales take-up this quarter. In 1Q13, CapitaLand sold 544 units in Singapore (1Q12: 57 units, 4Q12: 352 units), dominated by D’Leedon which was priced to sell. In China, CapitaLand sold 955 units, up 3-fold yoy, although down 19% qoq due to seasonal factors. Going forward, mgt targets to launch Marine Point (120 units) and Bishan St14 site (700 units) in 2H13, and will continue to bid for well located sites. In Danga Bay Iskandar, master planning is in progress, with launch expected in 1H14. In China, 3,500 units are expected to be launch-ready in 2013. For mall, Bedok Mall and Westgate remains on track to open in 4Q13. Nomura keeps at Neutral with TP $4.00, notes valuation at 23% discount to its RNAV is not expensive, but prefers CMA. HSBC lowers TP to $4.35 from $4.40, but upgrades to Overweight from neutral on valuation grounds. BNP rates at Buy with TP $4.40, expects CapitaLand to benefit from greater financial flexibility to capture invmt opportunities in a slower mkt; tips sale of Australand as catalyst. Deutsche maintains Buy with valuations attractive at 26% discount to its NAV vs 11% over the last 8 yrs, lifts TP by 1% to $4.43. OCBC maintains Buy with TP $4.29, believes mkt will likely react positively to the latest results.