** Morningstar raises fair value estimate for property investment and funds management firm Charter Hall CHC.AX due to optimistic growth outlook on funds under management $(FUM.UK)$ for the asset management business

** Brokerage says stock is 'narrow moat' and raises fair value estimate by 2% at A$17.50

** Morningstar sees 6% compound annual growth rate over the next 5 years for FUM, slightly above expectations of its peers

** Brokerage adds that even though firm's office business segment has been underperforming it doesn't foresee any substantial negative impact on earnings due to co's diverse nature of FUM, others

** Morningstar flags risk of rising interest rates which could diminish appeal of property funds as an alternative to low-yield fixed-income investments impacting CHC's fund inflows

** 3 of 8 analysts rate the stock "buy", 2 as "hold" and 3 as "sell"; their mean PT is A$17.39 – LSEG data

** Stock up 13.8% YTD as of last close

(Reporting by Kumar Tanishk in Bengaluru; editing by Giles Elgood)

((Tanishk.Kumar@thomsonreuters.com; X: @thatstanishk;))