FORTUNE REAL ESTATE INV TRUST
SGX:F25U
Fortune REIT - FY18 Interim Results Preview
- 1H18 distribution income expected to grow by a modest 3% on higher rental income.
- Reversionary growth should stay healthy.
- BUY With HK$10.50 Target Price.
What ’s New
- Fortune REIT will announce its interim results for FY18 on 27 July. We forecast its distribution income to rise 3% to HK$501m, led by a modest growth in rental income.
- We forecast total revenue to grow 3% to HK$1.03bn, thanks to positive rental reversion. We expect its rental reversion to stay healthy at 10-15% on renewals in 1H18. Cost-to-income ratio is estimated to remain stable at c.25- 26% (1H17: 25.3%). NPI should also grow 3%. io.
- Fortune REIT has just commenced the asset enhancement works at West Block of Fortune Kingswood, which are carried in three phases with targeted completion in 2020. io.
- Key things to watch for include asset enhancement progress update, outlook of retail reversionary growth, interest-rate hedging, and acquisition prospects, among others.
Jeff YAU CFA
DBS Group Research Research
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Ian CHUI
DBS Research
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Jason LAM
DBS Research
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https://www.dbsvickers.com/
2018-07-24
SGX Stock
Analyst Report
10.500
Same
10.500
