Balder (Hold, TP: SEK42.00) - Refinancing in focus
We reiterate our HOLD on a neutral Q3, but have cut our target price to SEK42 (60) on raised risk premiums. Near-term risks include: 1) raising credit spreads for its c40% of total debt to refinance in 2023–2024; 2) 2023e rent indexation below peers (57% residential assets); and 3) potentially losing credit rating equity classification for its hybrid bonds (would hurt the LTV).Fastighets AB Balder is a Sweden-based company engaged in the acquisition, development and management of residential and commercial real estate. The Company's real estate portfolio is comprised primarily of residential real estate and is located in such cities, as Stockholm, Gothenburg, Lund, Malmo, Norrkoping, as well as in regions outside metropolitan areas of Sweden and in the Copenhagen region in Denmark. The Company's subsidiaries include Balder Storstad AB, Balder Mellanstad AB, Din Bostad Sverige AB, Egby Vindkraftverk AB and Serena Properties AB.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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