Keppel DC REIT - OCBC Investment 2020-07-22: Another Quarter, Another Affirmation Of Quality

KEPPEL DC REIT (SGX:AJBU) | SGinvestors.io KEPPEL DC REIT (SGX:AJBU)

Keppel DC REIT - Another Quarter, Another Affirmation Of Quality

  • Keppel DC REIT's 1H20 DPU grew 13.6% y-o-y.
  • Portfolio occupancy improved to 96.1%.
  • Raise Fair Value to S$2.86.



Keppel DC REIT's 1H20 results met our expectations

  • Keppel DC REIT (SGX:AJBU)’s 1H20 results came in within our expectations. Gross revenue and NPI jumped 29.8% and 32.1% y-o-y to S$124.0m and S$114.2m, respectively. This was driven largely by inorganic growth from acquisitions.
  • Keppel DC REIT's DPU rose 13.6% y-o-y to 4.375 S cents, and this formed 50.0% of our FY20 forecast.


Healthy and defensive operating metrics

  • Operationally, Keppel DC REIT’s portfolio occupancy saw an improvement of 1.4 ppt q-o-q to 96.1%. This was due largely to the inclusion of the 100%-occupied Kelsterbach Data Centre into its portfolio following the completion of the acquisition, but partially offset by a slight decline in occupancy (-2.5 ppt q-o-q) at Keppel DC Dublin 1 to 63.3%.
  • Overall portfolio WALE remains healthy at 7.4 years, with only 2.6% and 6.2% of leases expiring in 2H20 and 2021, respectively.


Ample room for inorganic growth ahead






OCBC Research Team OCBC Investment Research | https://www.iocbc.com/ 2020-07-22
SGX Stock Analyst Report HOLD MAINTAIN HOLD 2.86 UP 2.540



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