Lendlease Group

Higher levels: Lendlease Group (ASX: LLC) is a listed construction, property and infrastructure company and it provides property development, investment, and construction services. It focuses on large-scale mixed-use developments in the inner city of target gateway cities and has strong completion expectations in FY19 and it is expected that the production phase will start from FY20-22. The group delivered resilient earnings for the first half of the year and recorded PAT growth of 8 per cent to $425.6 Mn in 1HFY18 against the prior corresponding period (pcp). As a result, RoE achieved the upper end of 10-14 per cent target range and recorded at 13.8 per cent in 1HFY18. Net operating cash flow was $340.4 Mn compared to an outflow of $70.4 Mn in the pcp. During the period, the Group also made substantial progress in implementing its strategic agenda, securing two new major urbanization projects, converting opportunities in the infrastructure space and creating future growth potential for the fund’s platform.

Besides this, the group has bought back the total of 97,22,400 shares via on-market trade for the total consideration of $ 17,78,88,280.23. The group intends to buy back remaining shares with an aggregate consideration of $322,111,719.77 out of $ 500 Mn. 

Meanwhile, the stock climbed up 37.04 per cent in the past six months and was up by 4.38 per cent in the past one week as at August 07, 2018. At present, the stock is trading at a higher level, thereby we maintain our “Expensive” recommendation on the stock at the current market price of $21.600, considering valuation scenario despite positive outlook ahead.
 

Strong Business Model (Source: Company Reports)

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