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UOB KAYHIAN |
UOB KAYHIAN |
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Mapletree Logistics Trust (MLT SP) 2QFY25: Incurring Negative Double-digit Rental Reversion In China
MLT improved portfolio occupancy by 0.3ppt qoq to 96.0% in 2QFY25. Unfortunately, China incurred negative rental reversion of -12.2%. The outlook for China remains challenging and the weakness is expected to persist over the next few quarters. MLT cautioned that cost of debt would continue to rise as loans are refinanced and interest rate swaps are rolled over at higher interest rates in 2HFY25 and FY26. MLT provides FY26 distribution yield of 5.9% (FLT: 6.2%). Maintain HOLD. Target price: S$1.45.
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Hong Kong Exchanges and Clearing (388 HK) 3Q24: Risk-And-Reward Is More Balanced; Upgrade To BUY
HKEX reported a 6.5% yoy earnings growth in 3Q24 after a sharp increase in headline ADT following the rollout of stimulus packages by China in late-September. Although market velocity has normalised, ADT remains elevated, and NII could be more resilient going forward, suggesting more upside for earnings. The risk-to-reward ratio is more balanced now after the recent correction as HKEX is trading close to historical average of 30.5x forward PE. Upgrade to BUY. Target price: HK$364.00.
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MAYBANK KIM ENG |
LIM & TAN |
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Mapletree Logistics Trust (MLT SP) Finding a floor
Lower distribution, potentially receding headwinds MLT reported 2QDPU of SGD2.027c, -2% QoQ,-10.6% YoY. China weakness, higher financing expense, FX headwinds and divestments more than offset stable performance and contribution from acquisitions. While occupancy inched up, reversion was slightly negative (positive ex-China). Gearing was slightly higher while borrowing cost was stable. Headwinds are less intense – China reversion is guided to be less negative and debt cost guide is lower. We tweak up FY26 est., but maintain our SGD1.60 TP and BUY rating.
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Keppel Ltd ($6.38, unchanged) disclosed in its voluntary business update for 3Q & 9M 2024 that net profit, excluding the effects of the legacy offshore and marine (O&M) assets, was comparable year on year (yoy) for 9M 2024. During this period, Keppel registered a 14% growth in recurring income with higher contributions from both asset management and operating income. For 3Q 2024, net profit was lower yoy, in the absence of valuation and divestment gains in the Connectivity segment. At its last traded price of $6.38, Keppel Ltd is capitalized at $11.5bln and trades at 13x PE, 1.1x book, 5.3% yield and based on Bloomberg consensus target price of $7.71/share, 1 year upside potential is 21%. We like Keppel’s asset monetization and asset light business plans and maintain “BUY”. |
| LIM & TAN | DBS VICKERS |
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OUE REIT (S$0.30, unchanged) announced revenue of S$74.8 million for the financial period 1 July 2024 to 30 September 2024 (“3Q 2024”), 1.3% lower year-on-year (“YoY”). The slight decline was primarily attributed to the lower contribution from the hospitality segment. Net property income (“NPI”) was 3.7% YoY lower at S$60.3 million, due to upward revision of prior years’ property tax for Hilton Singapore Orchard and Crowne Plaza Changi Airport. On a like-for-like basis excluding the tax revision, NPI would have decreased by 1.2% YoY OUE REIT’s market cap stands at S$1.6bln, and currently trades at 0.51x P/B with an annualized dividend yield of 6.2%. Consensus target price stands at S$0.36, representing 20% upside from current share price. OUE REIT’s portfolio remains well-supported by the growing hospitality segment and stable performance of Singapore commercial properties. As a beneficiary of the upcoming rate cut cycle and with its robust operations, we recommend “Accumulate”.
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COMFORTDELGRO Expansion in UK P2P with Addison Lee acquisition, execution will be key
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