CapitaLand

CapitaLand: in a surprise move, purchased 1.5m shares at $2.40/ sh yday. This is the first time the co has actually bought back shares, and up till the results briefing in mid Aug, maintained that a share buyback was not likely. CapL has a 2% mandate which allows share buyback up to 85.4m shares.

StanChart views this positively, believes the co is responding to feedback from shareholders, including majority sh/h, Temasek.
Tips the stock could outperform on the back of this, as it could signal to investors that change is underway. Adds, the stock has underperformed the STI by 30% in the last 12 months, and.this could prompt investors who are currently underweight CapL to at least return to Neutral weight as this is a large index stock.
Tips the next positive catalyst to be a higher dividend of 6-8 cts in Jan 2012, above the 5 cts paid last year.
Continues to expect the co to invest capital in earnings generative projects. Notes the recent Hangzhou acquisition showed its ability to capitalize on tight credit conditions in China to secure a good site at an attractive price and more could follow.
Reiterates Outperform ratings with TP $3.75 set at 15% below RNAV of $4.40/sh.