MIT – DBSV

New moves for Dragon Year

• 3Q12 results exhibited strong resilience

• Maiden asset enhancement programs to be embarked over next two years

• BUY, with slightly higher TP of S$1.26

Results in line. Gross rental and net property income of S$65.7m and S$45.6m were 23% and 24% above IPO forecasts respectively. This strong growth was largely due to full quarter contribution from the new acquisitions. Organic performance remained healthy with occupancy at a high c.95.1% (vs 94.5% in 2Q12), while rental rates inched up to est. S$1.56, ex acquisition portfolio. As a result, distributable income beat forecast by 28%, translating to a DPU of 2.16 Scts (+15% due to an enlarged share base).

Operational data still positive. Reversions remained at a strong c26-31% above passing levels for most sub-sectors. However, its business parks saw a slight downward reversion of c10% due to a higher base effect, which we believe is tenant specific.

New asset enhancement plans. MINT will embark on its maiden AEI works (starting 2Q11 till end 2013) to build an additional c200k of GFA as well as enhance the façade of its Toa Payoh North 1 & Woodlands clusters to meet growing demand for space at the respective clusters. The manager targets an IRR of c9% for both AEI projects when completed in 2H13.

BUY with revised TP S$1.26. Supported by strong earnings stream from a diversified portfolio, MINT is expected to deliver a stable set of results in the coming quarters. In view of the new AEI plans, we have raised our

FY14F DPU slightly by 1.1% to 8.6 Scts. As a result we adjusted our target price to S$1.26. Current price offers a FY12-14F yield of 7.5-8.1%.