Selvaag Bolig (Hold, TP: NOK32.00) - Soft sales and starts
Selvaag Bolig sold only 86 homes (net) in Q3, a drop of 31% YOY and 50% below our forecast. The company stated: “Among other things, this is due to interest rate increases, fewer sales starts because of increased construction costs and general macroeconomic uncertainty.” We have cut our 2024 forecasts on fewer expected project starts and completions. We also see downside risk to Bloomberg consensus ahead of the full Q3 report (due at c07:00 CET on 11 November). We reiterate our HOLD but have cut our target price to NOK32 (42).Selvaag Bolig ASA. Selvaag Bolig ASA, formerly Selvaag Bolig AS, is a Norway-based company engaged in the development of residential properties. The Company manages the entire process, from the purchase of land to the sale of finished homes. The Company operates through such subsidiaries, as Selvaag Bolig Modulbygg, which develops flats and terrace houses with the aid of modules; Meglerhuset Selvaag, which is an estate agency responsible for the sale of the Company's new homes, and Selvaag Pluss Service, which is engaged in the operation of the Company's Pluss Homes that offer security and services, such as cleaning and booking of tickets, among others. The Company's projects are located in Oslo, Stavanger and Bergen, Norway, as well as in Stockholm, Sweden, and include Lorenskog Stasjonby, Nyhavn Brygge, Lervig Brygge Pluss, Bjornasen Start and Utsikten-Mortensrudhoyden, among others. In the second quarter of 2013, the Company sold 200 homes.
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