Frasers Commercial Trust (A48U.SG) is down 2.9% at S$0.170, in hefty volume of 23.6 million shares, after reporting 1Q FY11 gross revenue of $29.0 million, down 2.3% on year and off 1.1% on quarter, which was mainly on lower contribution from Cosmo Plaza due to the expiry of a significant tenancy in August 2010. 

FCOT successfully divested Cosmo Plaza on Jan. 18, 2011, notes OCBC; “We view the divestment of Cosmo Plaza favorably, as this will improve the overall quality of the portfolio and create additional debt headroom for FCOT to enlarge its existing portfolio via future acquisitions.” 

 

The house puts its Buy rating and $0.18 fair value estimate under review, pending more updates from management and notes that net property income dropped 2.4% on year and 1.2% on quarter to $22.9 million; “Our valuation has previously factored in the divestment of Cosmo Plaza, and 1Q11 income was in line with our estimates.” 

 

The REIT is likely to trade in a $0.165-$0.175 range today.