The interim results, with EBITDA of $36.3m down 13% on pcp, demonstrated the impact of recently tightened lending conditions; although settlements were up, sales were markedly down. While PPC is well positioned to weather the current conditions (strong balance sheet, a well-diversified and low-cost portfolio, and a capital-light funding model), it will not be able to escape the headwinds. There is upside to reach our revised valuation of $120 (prior $1.30), but while property market uncertainty and risks prevail, we struggle to see positive catalysts. As a result we change our recommendation to HOLD (prior BUY).
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