The Insider: Standard Chartered, Capital & Regional

Standard Chartered man bails out

Standard Chartered has rallied by a fifth since plunging to a six-year low in January. Replacing under-pressure chief executive Peter Sands with former JP Morgan chief Bill Winters in June has been well-received, but profits plunged in the first quarter and there are not too many in the City getting carried away just yet.

Jaspal Bindra, the head of Standard's Asia business, was ousted as part of the same reshuffle that cost Sands his job. And the Hong-Kong-based banker is not hanging onto his shares. He left Standard at the end of April, and a day later sold 90,291 shares at 1,065p, netting almost £962,000.

He still owns 192,956 shares, currently worth almost £2 million.

Investec Securities, however, is not keen. "With fresh downgrades to our Q2-Q4 2015e revenue forecasts, we expect a 6% revenue decline in full-year 2015e. Sell," says the broker, which repeats its 970p price target.

Stake-building at Capital & Regional

UK shopping centre-owner Capital & Regional has been a reliable performer over the past few years. Trading at 23p in 2012, the shares are now worth 56p, valuing the business at almost £400 million.

A real estate investment trust, or REIT, since the end of December, the company published decent full-year results a couple of months ago. It made a pre-tax profit of £67.2 million and net asset value (NAV) per share increased by 11% to 60p.

That conversion to REIT status also means the dividend will rise substantially this year. An anticipated increase from 0.95p to 2.9p in 2015 gives a prospective yield of about 5.3%.

Now, non-executive director Louis Norval has begun stake-building. In recent weeks, a company called Mstead Limited, in which the South African property magnate has a beneficial interest, has spent £2.8 million on 5 million shares at between 56p and 56.5p. Of those, 4 million were purchased in the past few days.

With the dust settled, Mstead now owns nearly 50.7 million C&R shares, or 7.2% of the business, taking Norval’s stake to 201 million shares, or 28.7% of the company. That holding is worth about £114 million.

Last year, management highlighted the potential for listed sector company consolidation. Names like Redefine or NewRiver Retail have been mentioned as potential buyers.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.