*** Guocoland ***

Guocoland: CIMB initiates on Guocoland and believes the stock is due for re-rating. The house has a TP of $2.88, based on a 25% discount to its base case RNAV of $3.84.

Securing ownership of the Beijing Dongzhimen (DZM) project would re-focus investors’ attention to the potential value unlocking upside rather than on the drag from possible provision for cost write-offs that had hampered past share price performance.

The group is on track to achieve a more sustainable ROE by expanding recurrent income base from FY17. Room to move up the value chain to fund management exists in mid-term.

Guocoland is trading at a 38% discount to CIMB's base case RNAV of $3.84. There is upside room to Guocoland’s RNAV if Guocoland Malaysia’s share price discount to book NAV narrows or if surplus from DZM is greater than its base case assumptions.