CapitaLand Integrated Commercial Trust - CGS-CIMB Research 2021-07-29: Diversification Boosts Resilience

CAPITALAND INTEGRATED COMM TR (SGX:C38U) | SGinvestors.io CAPITALAND INTEGRATED COMM TR (SGX:C38U)

CapitaLand Integrated Commercial Trust - Diversification Boosts Resilience




CapitaLand Integrated Commercial Trust (CICT)'s 1H21 results highlights

  • CapitaLand Integrated Commercial Trust (SGX:C38U) reported 1H21 gross revenue/NPI of S$645.6m/S$472.2m, up 102.8%/118.2% y-o-y, due to the inclusion of CCT’s contributions post-merger and consolidation of income from Raffles City Singapore (previously a JV).
  • CapitaLand Integrated Commercial Trust's 1H21 distributable income of S335.9m (+206.2% y-o-y) translates to a DPU of S$0.0518. Committed portfolio occupancy stood at 94.9% as at end-1H21 (vs. 95.9% in 1Q21).


Tenant sales improved but shopper traffic continues to lag

  • 1H retail occupancy was 97%. Portfolio retail sales in 1H21 beat 1H20’s by 5.3% but flat vs 2019’s level at 86.3%. Shopper footfall was 4.2% higher y-o-y but only 61.3% of 2019’s level, with suburban malls performing better than downtown malls on both metrics. Trade sectors that did well in 1H include jewellery & watches, home furnishing, and education.
  • In 1H21, CapitaLand Integrated Commercial Trust renewed/leased 0.54m sq ft of retail space with a -9.1% reversion, although the decline rate slowed in 2Q. CapitaLand Integrated Commercial Trust has a remainder of 7.2% of retail leases by portfolio gross rental income to be renewed in 2H21. We anticipate the negative reversion to persist as tenants continue to adapt to a post-COVID-19 world.
  • In 1H21, CapitaLand Integrated Commercial Trust granted S$18.9m of rental waivers to tenants, particularly during the first P2 (Heightened Alert) period.


Maintaining high office occupancy

  • End-Jun office committedLot One Shoppers’ Mall is currently undergoing fit-out works, on track to reopen in 2H21.
  • Office space at 21 Collyer Quay has been handed over to WeWork, and the lease is set to commence in late-2021.
  • With a 40.5% gearing, CapitaLand Integrated Commercial Trust said it would also continue to evaluate portfolio reconstitution including divestments and explore acquisition strategies, focusing on developed markets.


Reiterate ADD rating on CICT






LOCK Mun Yee CGS-CIMB Research | EING Kar Mei CFA CGS-CIMB Research | https://www.cgs-cimb.com 2021-07-29
SGX Stock Analyst Report ADD MAINTAIN ADD 2.560 SAME 2.560



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