The shares of South African commercial property developer and investor NEPI Rockcastle, listed in Johannesburg and Amsterdam, recovered on November 29 most of the 14% loss incurred on November 28 after Viceroy Research published a report accusing the company of inflating its net profit after tax numbers, Profit.ro reported.

But the recovery took place amid low sparse with NEPI shares and the price edged down on November 30 indicating that investors remain cautious.

Viceroy Research accused the Johannesburg and Amsterdam-listed real estate fund of overstating its profits from Romania.Viceroy said in its report that it had uncovered “numerous inconsistencies within NEPI Rockcastle’s financial reporting.” Even without taking those into account, the Isle of Man-based investor is “fundamentally overpriced when compared with peers,” it wrote.

In response, NEPI organised an investors call on November 29 and claimed that Viceroy’s report “breaches the most basic accounting principles”. Viceroy’s report incorrectly mixes financial reports filled by NEPI under Romanian national and IFRS standards, NEPI argues. The report is based on material errors, incorrect assumptions and unfounded claims, NEPI says.

NEPI is the biggest mall owner in Romania. Its portfolio of properties on the local market was valued at EUR 1.96 billion at the end of September and represented 37% of the fund's total portfolio.

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editor@romania-insider.com