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FCT to largely benefit from Singapore's reopening although pent-up travel demand may dampen shopper traffic: OCBC

Felicia Tan
Felicia Tan4/14/2022 03:05 PM GMT+08  • 3 min read
FCT to largely benefit from Singapore's reopening although pent-up travel demand may dampen shopper traffic: OCBC
The team has lowered its fair value estimate on FCT to $2.67. Photo: The Edge Singapore
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The team at OCBC Investment Research (OCBC) is keeping its “buy” call on Frasers Centrepoint Trust (FCT) as it sees the REIT as being “well-positioned” for Singapore’s reopening.

The team has, however, lowered its fair value estimate to $2.67 from $2.81 previously. It has also reduced its distribution per unit (DPU) estimate for the FY2023 by 1.4% on lower margin assumptions, and upped its risk-free rate assumption from 1.9% to 2.5%

“One of investors’ key concerns on the Singapore REITs (S-REITs) sector is rising utility costs. We believe FCT is sheltered from this in the near-term due to contracts which have been locked in for the remainder of FY2022 at least,” the team writes.

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