CDL HOSPITALITY TRUSTS
CDLHT
J85.SI
ASCOTT RESIDENCE TRUST
A68U.SI
SG Hospitality: - Slower growth in tourist arrivals for Jun
- According to Singapore Tourism Board (STB) figures, tourist arrivals from Jan-Jun 2016 are up +12.5% YoY. However, the pace of tourist arrival growth seems to have slowed with Jun arrivals up +7.1% YoY (vs. +10.8% for May, +15.3% for Apr).
- On a MoM basis, tourist arrivals dropped 6.4% in Jun this year (vs. -3.1% for Jun ’15, and -2.2% for Jun ’14).
- We note that visitor days grew +4.5% YoY for the Jan-Jun period, while inching up +1.6% YoY for Jun alone. This corresponds with various management’s feedback that Jun was a particularly tough month within 2Q16, especially in comparison to Jun 2015 during which the SEA games were held.
- Given the currently weak corporate outlook, the prospect of a more muted leisure demand would be worrisome for the 2H16.
- Yesterday, we reiterated our OVERWEIGHT rating on the REITs space, but would like to highlight that the hospitality sector remains the most challenged sector fundamentally.
- Despite this, some valuations look attractive and we encourage investors to buy on dips. Within the hospitality sector, Ascott Residence Trust [BUY; FV: S$1.24] and CDL Hospitality Trust [BUY; FV: S$1.53] are our top picks
Deborah Ong
OCBC Securities
|
http://www.ocbcresearch.com/
2016-08-24
OCBC Securities
Analyst Report
1.24
Same
1.24
1.53
Same
1.53
