Avior Capital Markets - Coronation Fund Managers Limited (12AS) Coronation | Not enough to turn the flows

Report

Avior Capital Markets

David Talpert

Coronation | Not enough to turn the flows

Over the past four years, Coronation Fund Managers (CML) has experienced cumulative net outflows of R176bn. The outflows are due to a combination of industry outflows and disappointing fund performance. Based on the weak local economy and lacklustre investment performance, we do not expect CML to attract positive net flows over the next three years. We expect FY '19 earnings to decline by 22%.

We estimate CML's Jun '19 AUM to decline by R7bn to R579bn. We expect H2 '19 net outflows of R17bn (H1 '19: R21bn). Based on factsheet returns, we estimate quarterly retail net outflows of R1.6bn (H1 '19: R7bn). We estimate quarterly institutional and international net outflows of R6.8bn and R1bn respectively.

05/07/2019 13 EN

Underlying

Coronation Fund Managers Limited

Coronation Fund Managers is a third-party fund management companies. Co. is organized into three key segments: institutional, which manages institutional assets in South Africa in both segregated and pooled mandates; retail, which provides a range of funds distributed through the non-affiliated channels of independent financial advisors and linked investment service providers; and international, which is being managed from Cape Town and London. Co.'s customers include retirement funds, medical schemes and multi-manager companies in South Africa, banking and insurance groups, investment advisory businesses, independent financial advisors, individuals and direct unit trust accounts.

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ZAE000047353 Johannesburg Stock Exchange South Africa

Provider

Avior Capital Markets

Avior is a globally recognised capital markets research and trading firm, with the broadest research coverage within the region, with 100+ SA and 20+ SSA companies under coverage. Avior services clients from offices in London, Cape Town and Johannesburg.

Our research quality is consistently recognised in local and global surveys, with 18 analysts currently rated in their respective sectors (FM 2017). Value add through in-depth, innovative, high quality and consistent research with comprehensive underlying fundamental modelling supported by regular analyst and roadshow interactions.

Avior has proven that by working closely with our clients we can mutually develop dominant positions in certain sectors, going from strength to strength. Avior has a dedicated ESG team, having been ranked #1 in Corporate Governance research since 2008.

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Analysts

David Talpert

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Coronation | Not enough to turn the flows

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