Why CapitaMalls Asia can't be knocked off top spot

Even as share price dipped 3.4%.

According to Nomura, CMA’s share price has declined by 3.4% since the start of March (vs. the FSSTI’s marginal gain of 0.7% over the same period) when policy concerns in China began to resurface in the market. 

Given the policy risk in China is largely centred around the housing market (vs. CMA, which is a retail property developer), the question is whether the market is indiscriminate (ie, sell as long as the company is involved in China real estate, regardless of the segment).

Here's more from Nomura:

It appears that the market deserves more credit. Notwithstanding CMA’s 3.4% fall in the share price, the stock still outperforms other property stocks with exposure to China real estate.

In fact, CMA also appears to have held up better than other stocks in April 2010 when the Home Purchase Restriction (HPR) was first introduced in Beijing and in January 2011 when the HPR was implemented in other cities and Shanghai/Chongqing initiated property tax trials.

CMA’s relative defensiveness against policy risks in the housing market (be it in Singapore or China) is indeed one of the key reasons why we prefer it over CapitaLand, as posited in our note, “Limited upside apart from CMA”, published on 6 December 2012.