Catella delivered a strong Q4 report, in which sales and EBIT were well above our expectations, by 11% and 90% respectively. Both the Property Investment Management and the Corporate Finance segments performed particularly well in Q4, with the latter reporting its strongest quarter to date. The underlying AUM showed strong growth in Q4, growing 21% y-o-y (SEK 21bn) and came in at SEK 123bn, or 4% above our forecast. The AUM growth was mainly driven by existing Property Funds. The company also said that it has an additional SEK 12bn in committed AUM capital to be invested into new development projects and properties, which will enable further earnings growth and continued strong momentum in 2022.
The strong AUM growth in Q4 lifts EPS estimates
The AUM within the PIM segment was 4% above our estimate; we consequently raised our AUM base, which increases our estimates for the segment for 2022 and 2023. Even though Corporate Finance recorded its strongest quarter to date, we only make minor changes to our estimates and reduce transaction volume for H1’22 given the volatile start to the year. We have increased our 2022 estimates slightly for Principal Investments, driven by more equity invested by Catella in projects closing in 2022. The company is entering a sort of harvesting phase over the next 1.5 years, which we expect will drive strong earnings growth, with seven of Principal Investments’ projects being divested in the coming quarters.
Attractive fundamentals with a supportive valuation
Given that Catella is entering a harvesting period, with seven projects scheduled to be divested in 2022, while at the same time facing easy comps, we expect to see strong growth throughout the year. In our view, the company possesses many attractive fundamentals and the valuation remains supportive. Applying our latest
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