MAPLETREE LOGISTICS TRUST (SGX:M44U)
Mapletree Logistics Trust - Right Place To Find Shelter But At A Lower Entry Level
- Mapletree Logistics Trust's 4QFY20 DPU +1.2% y-o-y.
- Positive rental reversions of 2.0%; firm occupancy rate of 98%.
- Boost from positive e-commerce trends, but not immune to weaker macro backdrop.
4QFY20 results in-line with our expectations
- Mapletree Logistics Trust (SGX:M44U) reported an in-line set of 4QFY20 results. Gross revenue and NPI increased 5.5% and 9.3% y-o-y to S$128.1m and S$114.7m, respectively. DPU grew at a smaller magnitude of 1.2% y-o-y to 2.048 S cents due to higher income tax expenses and a larger unit base.
- For FY20, Mapletree Logistics Trust’s DPU improved 2.5% to 8.142 S cents and this formed 100.7% of our forecast.
Firm operating metrics
- Mapletree Logistics Trust’s operating metrics showcased its continued resiliency. Portfolio occupancy increased slightly by 0.3 ppt q-o-q to 98.0% as there were increases seen in Hong Kong and China. Australia, Malaysia and Vietnam maintained their full occupancy.
- On the rental front, Mapletree Logistics Trust achieved positive rental reversions of 2.0% in 4QFY20, the breakdown of which are as follows:
- Malaysia +4.5%,
- Vietnam +3.9%,
- Hong Kong +3.7%,
- Australia +1.3%,
- China +1.1%,
- Singapore +0.9% and
- South Korea +0.6%.
- Management had delivered positive rental uplifts for all quarters in FY20.
Positive boost from e-commerce growth, but watchful of softer macroeconomic outlook
- Mapletree Logistics Trust’s diversified portfolio of logistics properties has allowed it benefit from an increase in activities from some of its e-commerce tenants, while some of its tenants have also asked for additional space for stockpiling needs.
- Approximately 25-30% of Mapletree Logistics Trust’s portfolio has e-commerce exposure. On the other hand, management sees challenges from tenants in the F&B Retail Outlets and Fashion, Apparel & Cosmetics trade sectors (close to 10% of portfolio gross revenue), and has set aside S$5-10m which may be used to provide rental relief for tenants that are more adversely affected by COVID-19.
- We incorporate more conservative occupancy assumptions in our model in light of the uncertain macroeconomic landscape, and lower our FY21F DPU forecast by 3.8%. However, we expect Mapletree Logistics Trust to remain relatively more resilient vis-à-vis its peers, and also see Mapletree Logistics Trust as a key beneficiary of the structural shift towards more robust e-ecommerce growth trends ahead. As such, we lower our cost of equity assumption from 7.0% to 6.5%.
- After rolling forward our valuations, our fair value estimate increases to S$1.79 from S$1.59.
- See Mapletree Logistics Trust Share Price; Mapletree Logistics Trust Target Price; Mapletree Logistics Trust Analyst Reports; Mapletree Logistics Trust Dividend History; Mapletree Logistics Trust Announcements; Mapletree Logistics Trust Latest News.
OCBC Research Team
OCBC Investment Research
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https://www.iocbc.com/
2020-04-27
SGX Stock
Analyst Report
1.79
SAME
1.590
