CMA

CMA: 2Q12 results was broadly in-line, as net profit came in at $245.6m (+6% y/y, +236% q/q) fuelled largely by portfolio and revaluation gains of $198.6m, baring which core net profit at $53.6m (+41% y/y, -20% q/q). The result brings CMA’s 1H13 core net profit to $120.2m (+62%) Revenue for the quarter at $93.4m (+25% y/y, + 2% q/q) was due largely to contributions from nine new malls opened, two asset enhancement initiatives complete and acquisitions of stakes in four Japan malls in 2012, as well as profit recognition for units sold in Bedok Residences. Meanwhile, net property income of CMA’s China Malls +12.1% with total tenants’ sales on a same-mall basis growing by 14.9%. During the quarter, CMA secured higher pre-commitment at Westgate to 75% (50%) and Bedok Mall to 90% (70%), with both malls scheduled to open in 4Q13, while the group opened one mall, CapitaMall Meilicheng in Chengdu, China and targets to open another the phase 2 of CapitaMall Jinniu, in Chengdu by 3Q13. Going forward, the group will continue to pursue selective acquisitions in key markets of S’pore, China and Malaysia, as well as other good opportunities that satisfy its criteria for returns and have potential for growth. At current price, CMA trades at 1.1x P/B and remains Maybank-KE’s top big-cap pick as the house continues to like CMA’s retail mall business and expect its China operations to continue to exhibit steady growth. Maybank-KE has a revalued net asset value of $2.78 per share on CMA, representing a 30% discount from current share price. Latest brokers ratings as follows: Maybank-KE maintains Buy with $2.51 TP Deutsche maintains Hold with $2.01 TP Nomura maintains Buy with $2.49 TP StandChart maintains O/p with $2.29 TP