ANALYSTS SAY: Buy, Sell, Hold (27 Oct)

UOB KAYHIAN

Suntec REIT (SUN SP)
3Q22: Held Back By Higher Interest Rates And Weaker GBP

SUN achieved stronger operational performance in occupancies and rents across its office and retail portfolios. DPU from operations declined 15.6% yoy due to higher interest rates, weakness of the GBP and a higher proportion of asset management fees paid in cash. Management intends to maintain capital distribution at S$23m for two years. 2023F distribution yield is fair at 5.5%, although P/NAV of 0.66x is attractive. Maintain HOLD. Target price: S$1.39.

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Suntec REIT (SUN SP)
3Q22: Held Back By Higher Interest Rates And Weaker GBP

SUN achieved stronger operational performance in occupancies and rents across its office and retail portfolios. DPU from operations declined 15.6% yoy due to higher interest rates, weakness of the GBP and a higher proportion of asset management fees paid in cash. Management intends to maintain capital distribution at S$23m for two years. 2023F distribution yield is fair at 5.5%, although P/NAV of 0.66x is attractive. Maintain HOLD. Target price: S$1.39. 

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CGS CIMB

Frasers Centrepoint Trust
Stable performance but still recovering

■ FY9/22 DPU of 12.23 Scts (+1.2% yoy) was in line, forming 97.8% of FY22F.
■ FY22 reversions at +1.5%, tenant sales at 112.4% of pre-COVID levels.
■ Still positive on suburban malls. Reiterate Add with lower TP of S$2.48.

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Suntec REIT
3Q DPU dragged by higher funding cost

■ 3Q/9M22 DPU of 2.084/6.894 Scts slightly below at 20%/70% of our FY22F forecast.
■ Improvements across all segments, offset by higher funding costs.
■ Maintain Add with a lower TP of S$1.55. 

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ESR-LOGOS REIT
Healthy topline performance

■ 3Q22 NPI of S$69.9m is deemed broadly in line with our expectations, at
28.8% of our FY22F forecast.
■ Double-digit positive rental reversions, mainly from logistics and hi-specs
properties.
■ Reiterate Add rating with a lower TP of S$0.44.

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Yangzijiang Shipbuilding
First of likely more LNG carrier orders

■ YZJSB secured its maiden order for two 175,000 CBM LNG carriers for delivery in 2025-26. Reiterate Add with a TP of S$1.63.
■ We estimate contract prices to be in line with industry at c.US$240m each, bringing YTD order wins to US$4.08bn and orderbook to c.US$10.75bn.
■ Charter rates for 174k CBM vessels were record US$330k/day (spot) and US$260k/day (1-year), reflecting a tight market spurring newbuild orders.

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