HK Land: Posted a 4%YoY rise in underlying profit to US$810m for FY10, which were generally in line. Final Div was unchanged at US$0.10. Continued strong performance was due to a significant increase in spot office rents and a high number of residential completions, enabling Grp to maintain its profit at high levels…..
Total rental income at the consolidated level was up 2% yoy, despite a high base of passing rents in FY09. On the back of a 22%YoY rise in investment property valuation, Grp’s book value has risen by 30% yoy to US$8.64/share……
Going forward, with the amount of residential completions set to fall substantially in the next 2yrs, Grp’s commercial leasing will be the key earnings driver in the medium term. While market is constructive on the office market outlook and looking for a further 20% YoY rise in spot rents in 2011, it is unlikely to see a strong positive reversion this year.….
Goldman Sachs maintain Neutral with a US$7.35 TP, while Macquarie maintains OutPerform with US$8.50 TP.
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