CapitaLand Investment - Maybank Research 2024-08-15: Navigating Challenging Macro Conditions

• The macro environment is challenging but the discounted valuation, relative underperformance, and potential rate cuts keep our BUY rating on CapitaLand Investment.
• CapitaLand Investment's 1H24 PATMI was S$331m, -6% y-o-y and vs a loss for 2H23. Operating PATMI was S$296m, +32% h-o-h/-14% y-o-y.

Fee business up, capital recycling slow but steady

• - Read this at SGinvestors.io -
• CapitaLand Investment made ~S$1.7b of gross investments and divestments each. RevPAU of the lodging business rose by a mid-single digit.
• Gearing and debt cost inched up. CapitaLand Investment is focusing on M&As to grow the fund business and pursuing product and geographic diversification.

Fee business keeps delivering

• - Read this at SGinvestors.io -
• Notwithstanding a tough market, fund under management (FUM) and fee-related margin held steady at S$100b and 46bps respectively.
• About S$1.7b of capital was unlocked with almost half through sale to third parties. An equal amount was invested through 5 new private funds, including in an RMB fund. Lodging RevPAU grew 6% y-o-y with broad-based growth, barring Europe.

Pursuing diversification and asset-light growth

• Read more at SGinvestors.io.

Krishna Guha Maybank Research | https://www.maybank-ke.com.sg/ 2024-08-15 SGinvestors.io

---