CMT – Nomura

First look

CMT’s 3Q09 highlighted a slip in gross and net income in the group’s core mall portfolio. Excluding Raffles City, gross income from its retail malls fell 0.6% q-q as negative reversions took hold. Rising retail supply and continued cautious consumer spending will weigh on the outlook for rents, in our view, with some 36.2% of CMT’s leases up for renewal (by gross income) in 2010. With shares trading at 1.1x P/B, we retain our REDUCE rating. Price target S$1.28/unit.

Core mall rents slipping