Orco is expected to announce its NAV today after close or tomorrow
before market opening. Valuation is carried out by third party - DTZ as
at 31 December 2006 and includes all properties in the portfolio.
Our view:
DTZ valuation is carried out property by property once a year, taking
into account all aspects of each property, i.e. quality of tenants,
duration of contracts, location etc. Taking into account that last NAV
of EUR 70 per share announced together with 1H06 figures was only
management's estimate reflecting new acquisitions in 1H06 but not
revaluation of then existing projects. We see substantial revaluation
upside of mainly Bubny plot matched with other new projects as well as
further slight yield compression for existing properties througout the
year 2006 we expect the figure to come close to EUR 90 per share
(increase of almost 30%), which would imply that stock is currently
trading at 1.27x P/NAV. Real estate developers usually trades with
higher premium at around 1.3x to 1.4x P/NAV.