SINGAPORE (June 6): OCBC Investment Research is maintaining “hold” on CapitaLand Mall Trust (CMT) while raising its fair value estimate by a cent to $2.33 on the faster-than-expected ramp up of Funan.

This comes after CMT’s manager announced the impending <a href="https://www.theedgesingapore.com/funan-reopen-june-28-after-undergoing-three-year-redevelopment">opening of the integrated development on June 28</a>, two months ahead of the original scheduled date.

In response, OCBC has raised its FY19 and FY20 DPU forecasts by 0.5% and 2%, respectively, based on projections for the development’s retail and office components to contribute 3.2% and 7.6% of FY19 and FY20 net property income (NPI) forecasts in aggregate.

In a Thursday report, analyst Andy Wong says he believes the pre-committed occupancy of 92% for Funan’s retail component is a firm commitment level that bears testament to the development’s unique positioning and CMT’s strong marketing efforts.

While he likes CMT for its resilient portfolio and strong track record, which makes it a “defensive shelter amid the ongoing trade tensions”, the analyst  believes these positives have already been priced in.

“CMT is currently trading at blended FY19/20F distribution yield of 5.0%, as at 4 June closing price. This is 1.3 standard deviations below its 8-year mean of 5.4%,” notes Wong.

As at 10:57am, units in CMT are trading 4 cents higher at $2.50, implying a FY20F DPU yield of 5.28 times.

CapitaLand Mall Trust to deliver higher returns in near-term, but positives already priced in: OCBC

MSCI boss warns of climate risks

Keppel to acquire 50% stake in European asset manager Aermont Capital for up to $517 mil

Local banks 'resilient' in 2023, but MAS warns of deteriorating asset quality, climate transition risks

The new kings and queens of content

Singapore’s headline and core inflation figures increase to 4.7% and 3.3% in October

UOB Kay Hian lowers MPACT’s TP, DPU on lower contributions from China and further depreciation on forex

Matter of time before Straits Times Index stages rally

About 62.5% of shares in VTAC have been redeemed prior to the despac

The cybersecurity parasite hiding in plain sight

CapitaLand Mall Trust to deliver higher returns in near-term, but positives already priced in: OCBC

Related News

Highlights

MSCI boss warns of climate risks

Related News

UOB Kay Hian lowers MPACT’s TP, DPU on lower contributions from China and further depreciation on forex

OCBC remains RHB’s top pick after 3QFY2023 results

Is your retail brand everything, everywhere, all at once?