- Citi initiates on FKP Property with Neutral rating
- Upside and downside risks for earnings are in play
- Refinancing remains a key catalyst
- Buy ratings still dominate on the stock

By Chris Shaw

FKP Property Group ((FKP)) is a diversified play, owning, managing and investing in the retirement, residential apartments and communities, commercial and industrial and funds management sectors of the property market.

Citi has picked up coverage on FKP, rating the stock as Neutral given a relative balance between the potential risks and rewards on offer. Citi's price target is set at $0.54, a 10% discount to its $0.60 valuation to reflect the risks faced by FKP at present.

On Citi's numbers, FKP could enjoy as much as 4.7% earnings per share (EPS) upside in FY12 from an improvement in business conditions. At the same time, the broker sees a potential risk of as much as 9.5% EPS downside if the operating outlook was to deteriorate further.