Skanska (Hold, TP: SEK230.00) - Unveils new division, targets remain
Skanska announced “adjusted” financial targets prior to the CMD, and unveiled plans to launch a new division (Investment Properties, IP) in 2022 that will buy assets from the Commercial Development (CD) division and hold real estate investments in Sweden (REIT). We believe the rationale behind IP is Sweden’s still-strong real estate market and capturing the benefit of the sector’s high P/NAV in Skanska’s SOTP. The move will also leave Skanska even more heavily invested in real estate and reducing its exposure to construction. We reiterate our HOLD and SEK230 target price.Skanska is a project development and construction group, concentrated on selected home markets in the Nordic region, European countries and in the Americas. Co.'s business streams are: construction, which includes building and civil construction; residential development, which develops residential projects for immediate sale; commercial property development, which initiates, develops, leases and divests commercial property projects, with project development focusing on office buildings, retail and logistics properties; and infrastructure development, engaged in identifying, developing and investing in privately financed infrastructure projects, such as highways, hospitals and schools.
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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