A-Reit – Maybank Kim Eng
Ascendas REIT (A-REIT) has recently entered into a put and call option
agreement with Chasen Holdings for the sale of 6 Pioneer Walk (Goldin
Logistics Hub) for SGD32m
We raise our FY3/13F DPU by 2.2% in view of the divestment gains (assumed
paid out) but lower our FY3/14F-15F DPU by 0.6% pa. We expect FY3/14F-15F
gross revenue to decline by 0.3% pa due to the loss of rental income.
Based on our forecasts, business/science parks currently constitute 40% of
our FY12F GAV, followed by hi-tech (23%), logistics and distribution (19%),
light industrial (15%) and warehouse retail facilities (3%). Potential
acquisitions overseas could provide further upside for DPU growth.
Importantly, A-REIT is also less vulnerable to asset erosion, with its
defensive properties located primarily in Singapore. The stock currently
trades at 6.7% FY3/13F yield and 1.1x P/BV. Reiterate BUY with a
DDM-derived target price unchanged at SGD2.23.
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