Jardine Group of Companies

Jardine Group of Companies

Jardine Matheson: FY10 results generally in-line. Excluding exceptional items, core net profit +34% yoy to US$1.4b. Main drivers were Jardine Pacific (earnings +31% yoy due to higher volumes and increased sh/h in HACTL), Jardine Motors (earnings +67% yoy due to strong auto sales in HK and PRC), and Astra (earnings +63% yoy due to robust car and motorcycle sales in Indonesia and higher financial svc profit)…

Declared final DPS of US$0.85, bringing full yr payout to US$1.15, translating to 2.4% div yield. Payout ratio generally unchanged at 30% vs 32% last yr.
Street views mixed.
Goldman keeps at Sell, sees limited scope for further NAV growth. Raises TP slightly to US$51 from US$50, still at 30% discount to FY11E NAV…

HSBC keeps Overweight rating and US$54 TP, based on 30% discount to appraised valuation of US$77. Expects share price to be positive driven by consumption growth in Asia, rising HK invmt property prices, and higher global commodity prices. Catalysts include possible invmts in Indon power plants, infrastructure and retail expansion in SE Asia, plus Hold Co. share buybacks…

Morgan Stanley reiterates Overweight on Jardine Matheson and Jardine Strategic, but prefers the former due to its higher trading volume, higher div yield and sh/h proximity to the family.