REIT - DBS Research 2016-01-27: Singapore Traders Spectrum

REIT - DBS Research 2015-01-27: Singapore Traders Spectrum MAPLETREE INDUSTRIAL TRUST ME8U.SI  MAPLETREE LOGISTICS TRUST M44U.SI  ASCOTT RESIDENCE TRUST A68U.SI  PARKWAYLIFE REIT C2PU.SI  STARHILL GLOBAL REIT P40U.SI  SUNTEC REAL ESTATE INV TRUST T82U.SI 

Singapore Traders Spectrum Wired Daily - 2015-01-27 


MAPLETREE INDUSTRIAL TRUST (ME8U.SI)

  • 3Q16 results for Mapletree Industrial Trust in line; DPU up 5.6% y-o-y. 
  • We expect more modest reversions in FY16, while completion of development project from FY17F onwards will be a key driver for growth. 
  • Maintain BUY, TP S$1.62. 
  • We continue to like MINT for its stable and visible earnings profile, and conservative capital structure which will stand tall in the current volatile interest rate environment. 
  • Yield of >7.3% is attractive. 


MAPLETREE LOGISTICS TRUST (M44U.SI)

  • Mapletree Logistics Trust reported a steady set of results, in line with our expectations, as portfolio diversity stands out. 
  • Redevelopment projects are expected to drive earnings; acquisitions if any, are likely to be funded by a mix of equity and debt. 
  • Maintain BUY and S$1.15 TP. 


ASCOTT RESIDENCE TRUST (A68U.SI)

  • 4Q15 DPU of 2.07 Scts for Ascott Residence Trust slightly below expectations. 
  • The weaker-than-expected results was largely due to higher-than-expected overheads and minority interests as our NPI estimates were in line. 
  • Earnings were boosted by recent acquisitions in New York, Melbourne, Tokyo, Osaka and Kyoto. Close to S$1bn worth of acquisitions over past 18 months are expected to drive future growth. 
  • Maintain BUY, TP of S$1.33. 


PARKWAYLIFE REIT (C2PU.SI)

  • Parkway Life Real Estate Investment Trust’s 4Q15 DPU grew 16% y-o-y to 3.37 Scts; FY15 DPU grew 15% to 13.29 Scts, in line with consensus’ estimates, mainly due to divestment gains from the sale of 7 properties in Japan. 
  • High earnings visibility is a welcome trait in current volatile environment; further acquisitions in Japan will be positive. 
  • Maintain BUY and S$2.56 TP. 


STARHILL GLOBAL REIT (P40U.SI)

  • YTL Starhill Global REIT declared 2Q16 dividend of 1.32 Scts, up 2.3% y-o-y, in line with our expectations. 
  • Revenue increased 14% y-o-y (mainly due to additional income stream from Australian acquisitions). 
  • Net property income (NPI) was 10% y-o-y higher, after taking into account a 28% increase in property expenses. 
  • Volatility in AUD and MYR are key risk factors. 
  • Upside reversion potential from Toshin and Malaysia will more than offset near-term operating pressures at Wisma Atria. 
  • Maintain BUY, TP S$0.84. 


SUNTEC REAL ESTATE INV TRUST (T82U.SI)

  • 4Q15 of 2.75 Scts (+7% y-o-y) for Suntec REIT were in line. Results were boosted by contribution from Suntec City Retail and capital distribution. 
  • Going into 2016, despite the headwinds in the office market, Suntec guided that its office portfolio performance should remain stable. 
  • Meanwhile, the contribution from the retail component at Suntec City is expected to be positive in 2016 (i.e higher NPI).
  • Maintain HOLD, S$1.58 TP.


Yeo Kee Yan DBS Vickers | Ling Lee Keng DBS Vickers | http://www.dbsvickers.com/ 2016-01-27

DBS Vickers SGX Stock Analyst Report BUY Maintain BUY 1.62 Same 1.62
BUY Maintain BUY 1.15 Same 1.15
BUY Maintain BUY 1.33 Same 1.33
BUY Maintain BUY 2.56 Same 2.56
BUY Maintain BUY 0.84 Same 0.84
HOLD Maintain HOLD 1.58 Same 1.58

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