SINGAPORE (Oct 23): DBS Group Research is maintaining Mapletree Logistics Trust (MLT) at “buy” with $1.50 target price.
DBS says 2018 has been an exceptional year in terms of acquisitions, with MLT acquiring close to $1 billion of properties.
In a Tuesday report, lead analyst Derek Tan says he sees an improved quality in portfolio after the acquisition of five warehouses in Singapore, whose contribution will boost earnings and infuse further income stability in 2H19.
“We have further priced in $300 million worth of acquisitions to be completed towards the end of FY2020 in our estimates,” adds Tan.
In 2Q19, MLT’s gross revenues and net property income (NPI) grew by 13.8% and 14.6% y-o-y to $106.6 million and $90.2 million respectively on improved performance from its existing portfolio and contribution from past acquisitions in Hong Kong.
See: MapletreeLog declares 3.8% higher 2Q DPU of 1.958 cents on organic growth
On a half-year basis, gross revenues and new property income grew by 11.9% and 12.8% respectively, due to contribution from its Hong Kong acquisitions. Overall performance was also boosted by the new contribution from joint ventures, relating to MLT’s acquisition of 11 properties in China.
Due to the enlarged share base, 1H19 DPU of 3.915 cents formed 51% of DBS’s FY19F estimates.
Year to date, units in MLT are down 6.8% to $1.24.
