Monday, February 17, 2014

OCBC Report 18 Feb 14

KEY IDEA

CapitaMall Trust: Worth a revisit


Summary:
CapitaMall Trust (CMT) has continued to underperform both its local retail REIT peers and the broader S-REITs sector YTD, despite its enhanced portfolio assets, financial position and strong track record. At current price, we believe that valuation is increasingly compelling, now that CMT is trading at 1.04x P/B, and offers a FY14F yield of 6.1%. In the past year, CMT has benefitted from higher secured rentals at several of its portfolio properties post asset enhancement initiatives (AEIs). We believe CMT will continue to focus largely on organic growth via AEI and tenant repositioning to improve its portfolio yield. The domestic landscape has also been supportive of the retail leasing demand, given the relatively resilient retail sales, expanding population and interest from international and new-to-market retailers. Maintain BUY and S$2.20 fair value on CMT. (Kevin Tan)



MORE REPORTS


Mapletree Logistics Trust: Fire at Mapletree Xi’an Distribution Centre

Summary:
Mapletree Logistics Trust (MLT) reported that a fire broke out at one of its China properties, Mapletree Xi’an Distribution Centre, last Sat evening. One of the two blocks of buildings at the property was partially damaged by the fire. The fire has been put out and no injuries were reported. We note that the property is insured for physical damage and loss of business income for a period of 18 months, and that the property accounts for only 0.4% of MLT’s gross revenue. Hence, we expect minimal impact on MLT’s portfolio relating to the fire incident. We are maintaining our HOLD rating and fair value of S$1.06 on MLT. (Kevin Tan)
For more information on the above, visit www.ocbcresearch.comfor the detailed report.

NEWS HEADLINES


- Singapore's non-oil domestic exports (NODX) declined 3.3% YoY in Jan, due to lacklustre electronics shipments.


- Singapore notched a record 15.5m visitor arrivals last year, a 7.2% rise from 2012 that outpaced the more subdued 1.6% increase in tourism spend.

- Rail operators here are in for heftier fines for train disruptions, with the maximum penalty now raised to 10% of the rail line's annual fare revenue.

- Hiap Hoe Limited has bagged its fourth acquisition in Australia - an A-grade commercial building in Perth - for A$90m (S$102.3m).

- Blumont Group will be investing about A$1.95m (S$2.2m) in an Australia-listed diamond miner, its first foray into the precious stones sector.

- OSIM International has been served a writ of summons by The Wellness Group Pte Ltd and its chairman, Manoj Murjani, over its shares in TWG Tea.

- Cryoviva Singapore, a JV company between SGX-Catalist-listed AsiaMedic Ltd and Cryoviva International, has been licensed to run Singapore's third private cord-blood bank.

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