Balder (Hold, TP: SEK60.00) - Q4 above expectations
Q4 beat our expectations across the board, but the asset value write-down of just -0.4% (+2.7% in 2022), despite its high share of residential assets, raised eyebrows. Management played down the refinancing risk but we expect the market to continue to price in the risks of a credit rating downgrade and additional share issue, and we consider its 2023e P/FFO of 11.5x fair (historical average 17x). We reiterate our HOLD but have raised our target price to SEK60 (55).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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