Business Overview
Intu Properties Plc (LON: INTU) is a British real estate investment trust (REITs) which owns and manages 20 shopping centres primarily in the UK (United Kingdom) and in Spain.

Recent News
On 19^th February 2020, the company announced that it would release its annual results for the fiscal year 2019 ended on 31^st December 2019 on 5^th March 2020.

On 19^th February 2020, the company announced that Nickelodeon Adventure, an indoor play experience, has opened in Intu Lakeside's new leisure development.

Market Update (as on 20th January 2020)
The Group disposed of intu Puerto Venecia for Euro 475 million in December 2019. This would be used to repay the debt which would reduce the loan by around 1 per cent. The company made around GBP 500 million of disposals in 2019. Total footfall was increased by 0.3 per cent in 2019 as compared to 2018. The company reported a stable occupancy at 95 per cent.

Trading Update (From 1st July 2019 to 5th November 2019)
On 6th November 2019, Intu Properties announced a trading update from 1st July to 5th November 2019. The company is progressing well towards its five-year strategy with a major focus on liquidity creation. The market conditions in with the company operates remained challenging, and the CVAs (company voluntary arrangement) were below the expectations for the period. The company’s letting business has been performing low due to economic and political uncertainty which resulted in a delay in customers decisions. Despite the low performance, the company managed to sign new deals with popular brands. The company’s letting business saw some rise in recent weeks with Harrods launching its first standalone beauty store at intu Lakeside. At Cardiff based St David's, brands like Zara and H Beauty have signed an agreement for opening flagship stores. AliExpress is planning to open its first European store at intu Xanadú in Spain. The company is looking to dispose of its assets and to raise equity for liquidity requirements. Footfall in its centres was 0.9 per cent up in the nine months of the fiscal year 2019 as compared to same period last year. During the period, investment by customer grew to GBP 86 million as compared to GBP 64 million in the same period last year.

Share Price Performance  

Daily Chart as on 20^thFebruary 2020, before the market closed (Source: Thomson Reuters)

On February 20^th, 2020, Intu Properties Plc shares were trading at GBX 15.48 at the time of writing before the market close (at 8:00 AM GMT), down by 1.65 per cent against the last day closing price. Stock's 52 weeks High and Low are GBX 118/GBX 11. The stock price has givennegative 85.28 per cent returns during the previous year. In the last week, the stock price has given 26.23 per cent returns.

Key Risks Factors
A primarily higher level of administrations and company voluntary arrangement (CVA), has been impacting the rental income of the Intu Properties Plc (INTU). The company is struggling to make arrangements for its short term to medium term liquidity requirements and is looking to dispose of its assets and to raise equity for liquidity requirements.

Conclusion
The company is signing new deals with great brands. The Group has witnessed a pick-up in letting activity in recent weeks. With the latest deal of Nickelodeon Adventure, the company shown its growth potential. The fundamental changes in the retail sector have been impacting negatively on the retail property market as a result of which many weaker retailers are struggling to survive in the United Kingdom. With weak consumer confidence and political uncertainty resulted in pessimistic investor sentiment and declining property values. Other real estate investment trusts are avoiding participating in the recapitalisation of the Intu Properties, which shows their lack of confidence in the company’s growth prospects, and they are not confident about the Group’s business.

Based on the factors as highlighted above, we recommend investors to keep a “Watch” on the stock at the current price of GBX 16.14 (as on 20th February 2020, before the market close at 8:01 AM GMT), with support from Nickelodeon Deal needs to be evaluated at a later stage. 

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