CDLHTrust – UOBKH
3Q07: DPU up 69% than IPO forecast
3Q revenue higher than IPO forecast by 69% to S$24.0m. The initial portfolio of four Singapore hotels registered strong revenue growth ranging from 25% to 41% yoy. Novotel Clarke Quay, acquired in June 07, made its maiden contribution of $3.8m or 16% of total revenue. In tandem with revenue growth, DPU increased 69% to 2.36 cents than IPO forecast, suggesting annualized yield of 3.92%.
RevPAR grew 27.4% to $179 on same-store basis, driven by increase in both occupancy rate and Average Daily Rate (ADR). Singapore welcomed visitor arrival of 7.6m in the first three quarters, 5.3% growth yoy. Due to tight supply of hotel rooms, the Trusts’ Singapore hotel portfolio enjoyed ADR increment of 20%, in line with industry level. Its occupancy rate was also up 7.1 ppt to 89.9%
The largest hotel owner in Singapore, still with room to grow. All CDL REIT’s assets are close to CBD or Orchard Road, which allows it to cater for both leisure and business travelers. High margin corporate business accounted for 77% of total revenue in ytd 07, up from 71% in 06. Boasting 2324 hotel rooms in Singapore, CDL is set to benefit from booming tourism sector in the Lion City. Its gearing remains low at 23%, with $550m debt capacity for asset acquisition given 45% optimal gearing ratio.
Maintain BUY with earning forecast under review.
Cambridge – DMG
– Results in line with projections. Cambridge posted Q3 distributable income of $8.8m (DPU 1.7cts), +10% qoq and 29% ahead of its IPO forecast, on a 25% yoy and 8% qoq rise in revenue to $13.5m. The improved results were due to additional contributions from new acquisitions. For the 9M, distributable bottomline came in at $24.2m or 72% of our full year forecast. – Added 6 properties to portfolio since beginning 07. For the 9M07, the group had acquired 6 buildings valued at $137m, bringing its portfolio to 33 properties. New contributions from these properties had boosted bottomline. It has another $190.5m of new purchases which are expected to be completed over the next 1 month. In all, these assets are expected to add about $25m rental revenue annually to topline. – A further $94m of MOUs. The key driver to DPU growth is new acquisitions. In this respect, the group has expanded its portfolio by $328m with another $94m of MOUs. Given the increasingly competitive domestic acquisition environment, CIT also plans to venture into Malaysia and China and could look to possibly invest offshore over the next 12 months. Recent $193.9m cash raising exercise via an issue of 276.9m new units has lowered gearing to 38% and has freed up $480m of debt headroom for the group to seek new buys. – Maintain Buy. Share price has retraced 26% from the recent high and at present, offers significant value in view of its stable and secure income profile and long lease life. FY08 yield of 8.6% is amongst the highest with the S-reit sector. Our price target of $0.94 is conservative and is based on discounting cashflow from existing portfolio and has not imputed earnings accretion from potential new purchases. Reiterate buy with potential upside of 33%.
ALLCO – DBS
ALLCO, DBS remains a BUY with target price $1.65
– Gearing after Keypoint stands at 47%. Following the completion of Keypoint acquisition, Allco’s gearing will increase from 33% to approximately 47%, a level that potentially inhibits further acquisitions in the near term and Allco may seek funding from the equity markets for future acquisitions.
– Positive rental reversions. The demand for Singapore’s office and retail space within CBD continues to outstrip supply over the near future. Allco is poised to benefit from this demand squeeze.
– Attractive yield play. Allco continues to enjoy exposure to the booming Singapore property sector (54.1%), Australia (32.8%) and Japan (13.1%). At current price, Allco offers investors an attractive 6.3% yield with potential upside when rental reversions kick in (54% and 30%) over FY08 – FY09.
– Maintain BUY with TP S$1.65. We continue to like Allco and maintain our BUY call with TP S$1.65 based on DCF valuation. Compared to other S-REITS, Allco is currently trading at a 25% discount to NAV of S$1.36.
CMT – SGX
CapitaMall Trust’s Private Placement Fully Subscribed
Raises approximately S$352.1 million at S$3.63 per unit
Singapore, 30 October 2007 – CapitaMall Trust Management Limited (“CMTML”), the manager of CapitaMall Trust (“CMT”), is pleased to inform that 97.0 million New Units have been fully subscribed by investors through a private placement (the “Private Placement”), at an issue price of S$3.63 per New Unit (the “Issue Price”), raising aggregate gross proceeds of approximately S$352.1 million. The Private Placement is expected to reduce CMT’s gearing from 40.7% to 34.9%.
The issue price of S$3.63 represents a discount of approximately 3.2% to CMT’s volume weighted average price of the existing units in CMT (“Units”), based on all trades in the Units on Singapore Exchange Securities Trading Limited (“SGX-ST”) for the full market day of 29 October 2007. The book building exercise by Joint Lead Managers and Underwriters, DBS Bank Limited (“DBS”) and UBS AG, acting through its business group, UBS Investment Bank (“UBS”), commenced in the evening of 29 October 2007, and closed at 6.00 pm (Singapore Time) on 30 October 2007. The total demand book comprised over 30 quality long-term institutional investors from Switzerland, off-shore United States, Europe, Asia and Australia.
Mr Pua Seck Guan, Chief Executive Officer of CMTML, said, “We would like to thank all investors who have subscribed for the New Units under the Private Placement. The support from a wide spectrum of property-focused local and international investors is indeed a testament of their confidence in our strong execution and delivery capabilities. With our strengthened debt capacity, we are now well-poised to pursue yield accretive acquisition opportunities in Singapore to deliver stable distributions and sustainable total returns to Unitholders. “
Status and Listing of the New Units
The New Units to be issued under the Private Placement will rank equal in all respects with the then existing units of CMT and will qualify for any distributions which may be paid for the period from the day the New Units are issued to 31 December 2007, as well as distributions thereafter. Subject to the SGX-ST granting its approval in-principle, the trading of the New Units on the SGX-ST is currently expected to commence on or about 7 November 2007.
CMT’s policy is to distribute its distributable income on a quarterly basis to Unitholders. The next distribution was originally scheduled to take place in respect of CMT’s third quarter distributable income for the period 1 July 2007 to 30 September 2007 (the “Scheduled Distribution”). However, in conjunction with the Private Placement, CMTML intends to declare, in lieu of the Scheduled Distribution, a distribution of CMT’s distributable income for the period from 1 July 2007 to the day immediately prior to the date on which New Units are issued under the Private Placement. The New Units will not be entitled to such distribution.
The next distribution thereafter will comprise CMT’s distributable income for the period from the day that New Units are issued pursuant to the Private Placement to 31 December 2007. Quarterly distributions will resume thereafter.
Source : SGX