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UOB KAYHIAN |
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■ 1HFY6/19 DPU of 2.28 Scts was in line at 49% of our full-year forecast. ■ Singapore office segment saw recovery while retail segment remained weak. ■ Maintain Add, with a slightly higher TP of S$0.75.
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| OCBC SECURITIES | PHILLIP SECURITIES |
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OUE Hospitality Trust: 2019 is the year!
OUE Hospitality Trust’s (OUEHT) 4Q18 results were within expectations, with DPU up 0.8% YoY to 1.28 S cents. FY18 DPU came to 100% of our full-year forecast. We are optimistic about OUEHT’s prospects in 2019, given its current positioning as a Singapore-only hospitality REIT, the benign supply situation, as well as the anticipated opening of Jewel Changi Airport. In addition, Mandarin Orchard Singapore looks to benefit from the proposed plans to rejuvenate Orchard Road, which were announced yesterday. As part of a year-long trial by the Orchard Road Business Association (expected to start in Apr), Orchard Road will see more activities such as retail and food and beverage pop-ups, and arts and entertainment events. OUEHT’s valuations remain very compelling as at 30 Jan 2019. After incorporating the latest set of results, our fair value has increased from S$0.79 to S$0.82. As at 30 Jan’s close, OUEHT is trading at a 7.2% FY19F yield, ~70 bps and ~150 bps above FEHT’s and CDLHT’s respectively. We previously upgraded OUEHT from Hold to BUY on 20 Sept 2018, on the back of OUEHT’s dramatic share price decline. Since then till 30 Jan’s close, it has posted total returns of 7.0%, outperforming the Straits Times Index by 6.7 ppt and the FTSE Straits Times REIT Index by 1.6 ppt. We continue to find the REIT’s unit price very attractive as at 30 Jan. Maintain BUY on OUEHT with a S$0.82 fair value.
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Ascendas REIT Grabbing a new tenant
Gross revenue and DPU in line with expectation Almost full quarter contribution from Second UK portfolio of 26 logistics assets Build-to-suit development for Grab’s new headquarters at one-north Maintain ACCUMULATE. Raised target price to $2.88 (previously $2.78) due to higher DPU estimate
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Check out our compilation of Target Prices
