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PHILLIP SECURITIES |
PHILLIP SECURITIES |
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Singapore REITs Monthly: Oct24
Fewer rate cuts expected
▪ The S-REITs Index slumped 5.5% in October, reversing the 3.5% gain in September. The top performer for the month was Keppel DC REIT (KDCREIT SP, NEUTRAL, TP S$2.16), gaining 5.5% after it reported above 40% positive rent reversion for its major Singapore contract renewal. Acrophyte Hospitality Trust (ARAUS SP, non-rated) was the worst performer, falling 14%. The industrial sub-sector was the top performer in September, declining 3.8%, while the worst-performing sub-sector was overseas diversified, dropping 9.3%
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Thai Beverage PLCRebound in volumes, beer less relevant▪ Results were within expectations. FY24 revenue and PATMI (excl. NAB) were 98% /98% of our forecasts. Dividends in FY24 were raised 3.3% to THB0.62 (S$0.023).▪ Post-share swap, ThaiBev will avoid swings in earnings from Frasers Property fair value changes and lumpy development projects. In exchange, it will receive more stable beverage profits, including Vinamilk. Non-alcoholic beverages will account for 15% of PATMI, larger than beer’s 10%.
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PHILLIP SECURITIES |
PHILLIP SECURITIES |
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Keppel DC REIT Acquisition of KDC SGP 7 and 8
▪ KDCREIT is proposing to acquire Keppel DC Singapore 7 (SGP 7) and Keppel DC Singapore 8 (SGP 8), situated at Genting Lane, for a total consideration of c.S$1.438bn (including 10- year land lease tenure extension). ▪ The transaction is 8.1% accretive based on 1H24 pro-forma DPU, assuming the extension of the land lease and tax transparency is achieved.
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Yoma Strategic Holdings Ltd Riding through devaluation and disruptions
▪ 1HFY25 revenue declined 15% YoY to US$111.6mn due to a 55% depreciation in the Myanmar kyat (MMK). In local currency terms, revenue would have expanded 35% YoY, supported by an 81% jump in Yoma Land revenue. ▪ Net loss widened to US$12.5mn primarily from a US$7mn translation loss from Thai baht and US dollar borrowings. Wave Money’s money transfer volumes were mainly impacted by physical cash shortages in July, along with intensified conflicts in Northern Myanmar and severe flooding in August and September.
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MAYBANK KIM ENG |
LIM & TAN |
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Singapore Post Ltd (SPOST SP) Unlocking intrinsic value
Initiate with BUY and SOTP of SGD0.74 We believe SingPost is deeply undervalued, and now that management has moved to monetize and streamline its businesses, we see significant potential value from the sale of: 1) Famous Holdings & its Australian business; 2) SingPost Centre and post offices over the next 1-2 years. Our SOTP valuation is SGD0.86/share, and our SGD0.74 TP is based on a 15% holding co. discount. We expect further sharp rises in earnings and dividends from synergies and cost optimisation, as seen in 1H25. The conclusion of SGX’s review may also be a catalyst. Initiate coverage with BUY and TP of SGD0.74. Risks to our BUY rating are economic recession, rise in labour costs, asset monetization pricing not optimal and FX risks.
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The Business Times reported that City Developments / CDL (S$5.14, up 2 cents) and its joint venture associates recorded S$611.1 million in sales for the third quarter ended Sep 30, 2024, from 321 units sold, up from S$325 million and 183 units in the same period last year. Sales were primarily bolstered by the launch of Kassia, a 276-unit freehold development located off Upper Changi Road North. Launched in July, the project has sold 65 per cent of its units, or 179 units, to date, CDL said in a bourse filing on Friday (Nov 22). For the nine months ended Sep 30, CDL and its joint venture associates sold 905 units, generating a total sales value of S$1.8 billion, compared with S$1.4 billion from 691 units in the previous year. “The group’s other launched projects continued to sell well,” CDL said. To date, the 638-unit Tembusu Grand at Katong has sold 581 units (91 per cent), while The Myst at Upper Bukit Timah Road has sold 297 of its 408 units (73 per cent). City Dev is a key beneficiary of the current strong demand for residential housing. We maintain our BUY recommendation on City Dev given its undemanding P/B of 0.5x and target price of $8. |
