ARA

ARA's 4Q15 net profit surged 41% y/y to $25.6m on a firmer revenue of $46.1m (+7%) and lower FX losses and on-off fees.

The growth in top line was driven by higher management fees (+6%), which resulted from stronger REIT and portfolio management fees, as well as an increase in finance income (+17%) amid higher distribution income.

Operating profit jumped 40% to $29.6m, mainly due a reduction in finance cost given lower FX losses, and lower other expenses amid absence of a $3.4m agency fee for property divestment. Operating margin expanded 15.3ppt to 64.2% accordingly.

A final DPS of 2.7¢ was maintained.

On a yearly basis, asset under management grew 11.6% to $29.8b, underpinned by both ARA Private Funds and the REITs division.

During the year, the group launched three new private real estate funds, and its ARA China Investment Partners received additional capital commitment of close to US$320m, boosting committed capital of the fund to more than US$820m.

ARA is currently trading at 13x FY16 P/E. The street has 2 Buy ratings on the counter, with an average TP of $1.96.