ARA Asset Management Limited is a premier integrated real estate fund manager in Asia. Established in 2002, ARA is driven by a vision to be the best-of-class investment manager, offering bespoke solutions and enduring value to its investors and partners. The REITs that are managed by ARA include Suntec REIT, Fortune REIT, Cache Logitsics Trust, etc.
ARA's revenue and profit for FY2015 both reduced by 10% compared to FY2014. Cash flow was not so strong in 2015 because it did not sell most of the REIT units it received as management fee. The management maintained the same level of final dividend of 2.7 cents. Together with the 2.3 cents interim dividend, total dividend payout is maintained at 5.0 cents, which gives a dividend yield of 4.52% at the last closing share price of $1.105.
Fund management is an asset light and high ROE business, which is true also for ARA.
The key financial ratios for ARA are as follow:
PER - 12.33
P/NAV - 2.12
ROE - 17.21%
Dividend yield - 4.52%
Price/net-net current asset - 10.54
ARA's share price reached a high of about $1.89 in May 2013. It was trading at about $1.75 in May 2015. The price today is only about 63% of its 12-month high of $1.75.
My average purchase price for ARA is $1.054, which I think is a bargain for a high quality fund management business.
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