Capitaland

Capitaland: Duetsche maintains Buy with $4.43 TP. House note that CapitaLand, together with Genting Singapore, and Hotel Properties announced the divestment of four properties in London. These included a site at 99-121 Kensington High Street, 1 Derry Street, land and buildings on the east side of High Street Kensington Underground Station, and 25 Kensington Square. The total consideration for the sale included GBP46.9m (S$90.7m) in cash, as well as the discharge of GBP175m (S$338.9m) in debt. Via its one-third stake in the JV, CapitaLand expects to book a net gain of GBP11m (S$21.2m) from the sale. Mgt stated the sale is consistent with the co’s active capital mgt strategy, and reflects CapitaLand’s focus on core markets. Although the impact to NAV is marginal, believe management’s streamlining of operations and shedding of non-core assets is positive. Recall that the co had divested its stake in three serviced apartments in China and eleven rental housing properties in Japan earlier this year. House maintain Buy recommendation, with valuations attractive at a 38% discount to RNAV ofS$4.92. CapitaLand remains house top sector pick.