CapitaLand Investment - Maybank Research 2024-11-07: Active Capital Recycling

• CapitaLand Investment reported 9MFY24 revenue of S$2.104b, +1% y-o-y.
• Mid-single-digit growth in fee related business (FRB) revenue was offset by dip in revenue from real estate investment business (REIB) due to divestments.

Steady fee business, fund deployment picks up

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• Capital recycling accelerated in 3Q24. Deployment has up picked pace, though uninvested capital keeps building.
• RevPAU growth for the lodging is steady at mid-single digit.
• CapitaLand Investment's gearing was down while debt cost was unchanged. Focus is on inorganic growth, diversification and lowering costs.

Fee stream keeps flowing

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• Property management fees grew by 14%, driven by growth in rental income and realignment of fee reimbursements (6% growth excluding the realignment).
• Fees from lodging management grew 1% (+11% adjusted for one-off income received last year). This was led 4% RevPAU growth and an estimated 15% growth in operational keys. RevPAU growth was led by Japan and South Korea along with SE Asia and Australia.

Net debt to equity was 0.54x (1H24 0.59x) and debt cost was stable at 4.1%.

Active capital recycling, focus on costs cutting

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Krishna Guha Maybank Research | https://www.maybank.com/ 2024-11-07 SGinvestors.io

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