(CMMT MK/HOLD/RM1.55/Target: RM1.53)

CMMT’s 2Q17 core net profit dropped 0.8% qoq and 0.7% yoy, resulting in a 1H17 core net profit decline of 1.4% yoy. Sungei Wang Plaza and The Mines continued to drag earnings, mainly due to a disruption to shopper traffic, lower rental reversions as well as occupancy rates. We gathered that ytd tenant sales grew by a low single digit and management is expecting flat rental reversions for 2017. Maintain HOLD. Target price: RM1.53. Entry price: RM1.40.

Source: UOB Kay Hian Research - 20 Jul 2017