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RESEARCH: DomaCom – Valuable Fractions Of A Huge Pie

FYI | Apr 16 2019

By Pitt Street Research

Revolutionary Fractional Investing property platform

DomaCom Limited ((DCL)), a Melbourne-based property fund manager, has developed fully regulated products that have the potential to revolutionise property investing in Australia. Its unique online fractional investing platform allows investors to invest in only a fraction of a property, enabling them to build a leveraged portfolio of real estate assets.

Equity Release: Ideal for 'asset rich, cash poor' retirees

DCL’s new Equity Release product is expected to be launched shortly. It is primarily targeted at baby boomers looking to release equity (capital) from their family homes to fund retirement and for inter-generational wealth transfer.

Strong adoption expected by financial advisors

As DCL’s two products add another vital asset class to the toolbox of financial advisors, we expect these products to garner strong market support. DCL is targeting the property segment of Self-Managed Superannuation Funds (SMSFs), valued at $700bn and the $500bn retiree home market.

Valuation range of $0.35-0.46 per share

We value DCL at $0.35 per share (DCF model) in a very conservative base case (due to lack of historical information) and $0.46 per share in a scenario in which Funds Under Management growth accelerates in line with management’s expectations, i.e. on the back of the new residential property debt facility through La Trobe and potential conversion of the trial with a Big-4 bank into a commercial agreement.

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