Ascott Residence Trust - Fairly priced; trading at 6.8% FY18F yield
- Ascott Residence Trust (ART) announced that its rights issue has been oversubscribed at 1.8x, with valid acceptances making up 97% of the rights issue and excess acceptances constituting 85%.
- ART’s manager expects that the rights units will be issued on or about 11 Apr 2017. Do note that these rights units will rank pari passu to the existing units in issue.
- The Germany acquisitions are subject to unitholders’ approval at an EGM, which is scheduled to take place on 19 Apr 2017 at 11:30AM. Our current forecasts assume that the Germany acquisitions will be approved, given that they are accretive postrights issue.
- ART’s last closing price of S$1.100 is currently 0.5% below our fair value of S$1.105.
- ART is trading at a FY17F yield of 5.7% and FY18F yield of 6.8%. We maintain HOLD on ART with a fair value of S$1.105