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CGS CIMB |
UOB KAYHIAN |
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CDL Hospitality Trust Factoring in delay in Moxy contributions
■ Construction delays Moxy CQ contribution but purchase price locked in. ■ We push back our Moxy CQ contribution and EFR from 4Q25F to 2Q26F. ■ Hospitality sector recovery is on track with our forecasts. Reiterate Add.
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Banking – Singapore Rate Cuts Coming But Not Too Much
We anticipate one rate cut in 4Q24 (previous: three rate cuts) and four rate cuts in 2025 (unchanged), bringing the Fed Funds Rate to 4.00% by end-25. Rate cuts are less pronounced due to sticky inflation. The last mile for the deceleration of inflation is drawn-out due to tight labour markets. Maintain OVERWEIGHT. We raise our 2025 earnings forecasts for DBS by 1.5% and OCBC by 1.3%. DBS and OCBC provide 2025 dividend yields of 6.7% and 6.2% respectively. BUY OCBC (Target: S$18.35), followed by DBS (Target: S$41.40).
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UOB KAYHIAN |
LIM & TAN |
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Digital Core REIT (DCREIT SP) Expansion In Germany And Japan Increases Geographical Diversification
DCREIT continues to increase geographical diversification by acquiring an additional 24.9% stake in a Frankfurt data centre and a 10% stake in an Osaka data centre. Data centres in Germany and Japan expanded by 19ppt yoy to 33% of annualised rent. Aggregate leverage increased slightly by 0.7ppt yoy to 35.1%, while the average cost of debt eased 0.8ppt qoq to 3.9%. DCREIT provides a 2025 distribution yield of 6.3% (KDCREIT: 5.2% and MINT: 6.3%). Maintain BUY. Target price: US$0.85.
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We highlight the key points from Netlink Trust’s ($0.825, up 0.5 cents) annual report that was just released Revenue increased 1.9% to $411.3 million, up from $403.5 million the previous year. Earnings before interest, tax, depreciation, and amortisation on (EBITDA) was $292.4 million, marginally lower than that in FY23 mainly due to a one-off non-cash write-off of decommissioned network assets and higher operating costs. Netlink Trust’s market cap stands at S$3.2bln and currently trades at 29.5x forward PE and 1.3x PB, with a dividend yield of 6.4%. Consensus target price stands at S$0.96, representing 16.4% upside to current share price. Given it’s stable, sustainable and attractive yield, we maintain an Accumulate rating. |
| LIM & TAN | MAYBANK KE |
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At S$0.345, Yangzijiang Financial is capitalised at S$1.2bln and trades at undemanding valuations of 5.9x forward P/E, 0.3x P/B and 6.4% dividend yield. The company has received shareholders’ approval to expand into a broader range of maritime-related activities. Both the chairman and CFO have a great depth of expertise in the maritime industry and will provide some familiarity in these new businesses. While investor sentiments continue to look for a recovery in China’s real estate sector, share price may see support in YZJFH’s S$1.4bln cash pile, greater than its current market cap. Based on consensus target price of 45 cents, potential upside from its last traded price of 34.5 cents is about 30%. Given the attractive yield, low price to book and good potential upside to consensus target price, we recommend an “Accumulate” rating on YZJFH.
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First REIT (FIRT SP) A comeback story underpinned by diversification Initiate coverage with BUY and TP of SGD0.28 FIRT is a healthcare-focused REIT that owns hospitals and nursing homes in Indonesia, Japan and Singapore. It has come a long way since restructuring its master lease agreement by adding investments in nursing homes and its geographic exposure. We like its senior-focused nursing homes in Japan, which are supported by the aging population. Its hospitals are benefitting from more affluent Indonesians who choose private local hospitals over medical tourism. FIRT has restored its revenue back to levels near pre-restructuring, while its valuation is still attractive at a 20% discount to book despite moderate risks. We project an appealing FY24E DPU yield of 10%. Initiate BUY with a DDM-based TP of SGD0.28 (16% upside). Read more.... |
