Michael Hill, Lovisa less exposed to CPI-linked rent hikes-Citi

Michael Hill International

01/11/2022 04:21

** Citi says Australian retailers Michael Hill
International  MHJ.AX  and Lovisa Holdings  LOV.AX  have limited
exposure to inflation-linked rental hikes vs other retailers
    ** Says City Chic Collective  CCX.AX , Universal Store
Holdings  UNI.AX  and Accent Group  AX1.AX  may have a greater
proportion of leases tied to inflation
    ** LOV's rental costs could be less volatile than other
specialty fashion retailers owing to fixed lease increases in a
3-3.5% annual range - Citi
    ** Says MHJ and LOV pay lower percentage of turnover rent,
on average, relative to AX1, UNI, and CCX
    ** Notes, however, that both cos pay higher rent per square
metre while having smaller store size
    ** Citi recommends "buy" rating on MHJ, LOV stocks, stays
"neutral" on CCX, UNI and AX1
    ** YTD, MHJ down 12.7%; LOV up 21.5%; CCX down 76.3%; UNI
down 23.5%; AX1 down 39.6% YTD, as of last close
 (Reporting by Poonam Behura in Bengaluru)
 ((Poonam.Behura@thomsonreuters.com;))