The group has a portfolio provided with renowned partners in diversified sectors. It has deployed and continues to implement an aggressive investment and development program of 2.5 billion dirhams by 2025.
The Professional Association of Brokerage Companies (APSB) and the Casablanca Stock Exchange continued the 3rd edition of the series of conferences on the results and prospects of listed companies, this June 21, with a webinar on the value of Aradei Capital, treated by CFG Bank.
This meeting was an opportunity for analyst Kacem Benjelloun to discuss the prospects and achievements of the value, as well as the valuation and recommendations of the research company on the title. It should be noted that in YTD, Aradei Capital posted growth of 9.4%, while the MASI lost 9% over the same period.
In the first quarter of 2022, the property company demonstrated good dynamism, with a turnover increasing by 22% to 117.6 million dirhams. This improvement stems in particular from the positive impact of OPCI Cleo-Pierre, rental income from the El Jadida clinic and the stabilization of income generated by Sela Parks in Agadir and Temara.
The research company recalled that the group was evolving in a dynamic environment in its sector, namely rental real estate. The value has opportunities, in particular with the good dynamism of undertakings for collective investment in real estate (OPCI). “Over the next few years, operators will have to separate their core business and their property management so as not to disperse themselves and limit their development costs. This represents a very interesting advantage,” emphasizes Kacem Benjelloun.
A solid track record and still aggressive development
The group benefits from a good rate of investment and development. Over the past six years, in terms of GLA (Gross Leasing Area, or useful commercial surface) as well as turnover, the property company has multiplied its indicators by 3.5, even by 5 for some. The GLA increased from 105,000 m² in 2015 to 382,000 m² at the end of 2021. At the end of Q1-2022, it reached 391,000 m². The value of the portfolio went from 1.6 billion dirhams to 6.1 billion dirhams. The RNPG, called FFO (Fundings From Operations) in the real estate sector, has increased from 44 MDH in 2015 to 204 MDH in 2021.
The group continues its momentum and has a substantial investment envelope over the period 2021-2025 of 2.5 billion dirhams. This investment program is continuing in the group’s diversification strategy, particularly in the field of health.
“The first investment lever comes within the framework of the partnership with Akdital, in particular the subsidiary Akdital Immo which will support the development of seven new clinics. One is already operational in El Jadida. Four more should be delivered this year and two more in 2023,” explains the analyst. This year, the research company anticipates an investment of 872 MDH from Aradei Capital, up 37% compared to 2021.
“The group will also deliver its first Prism office building, with a development cost of 60 MDH excluding the cost of the land”, specifies Kacem Benjelloun. It will also continue its investment program in the field of supermarkets-hypermarkets, in order to support Label’Vie in the development of its sales areas, up to one room per year from 2024. In the endthis would generate an additional GLA of 150,000 m² to reach 550,000 m² by 2025.
A recommendation to buy and good forecast growth
The research company anticipates dynamic forecast figures for the period 2021-2026, with an average annual growth in turnover of 12% to reach 741 MDH. In 2022, it is expected at 450 MDH. The FFO should experience an average annual growth rate of 8% to reach 301 MDH at maturity.
This year, the FFO is expected at 202 MDH stable compared to 2021. The DPA (dividend per share) should increase by an average of 5.7% per year and reach 24 dirhams in 2026. This year, it should reach 16.1 dirhams. A return of 4% is expected in the medium and long term.
The Research Society recommend buying the title and anticipates an upside of 15.6% at 525 dirhams, against 454 dirhams at the end of the June 21 session. “Our recommendation is based on various factors: strong growth potential thanks to a large and easily activated land reserve, and a strategic development partnership with Best Financière and its subsidiaries as well as with Akdital. The group should also benefit from the good development of rental real estate,” explains Kacem Benjelloun.
The group can also capitalize on its attractive distribution rate, of a minimum of 85% of the FFO. The value combines, moreover, yield and growth, which attracts investors in this rather troubled period on the markets. Especially since the group has an investment plan that guarantees growing revenues over the next few years. It holds a solid portfolio of 30 assets and 1 OPCI.
“It should be emphasized that if Aradei Capital applies OPCI management rules, it is not intended to be. He is an OPCI investor. This is an attractive investment opportunity for investors,” concludes the CFG Bank analyst.