Dasin Retail Trust has rebounded off a low of 59 cents made on June 30, to end the week at 61 cents. At this price, the trust is priced at just 0.43 times its net asset value of $1.41 which represents a hefty discount.
On April 28, Zhang Zhencheng, owner of Dasin Retail Trust’s trustee-manager and the trust’s major unitholder, and a unit of ARA Asset Management announced that ARA would take a 50% stake in the manager, and acquire approximately 5% of Dasin units from Zhang. For the Dasin units, ARA would acquire a 2.5% stake first, followed by the remaining units to make its stake up to 5%. A business update by Dasin on May 17 said the sale shares of the manager and the initial stake in the trust is expected to complete in May this year. There has to-date been no announcement of the completion of this transaction. In addition, the units in Dasin held by Zhang rose from 53.56% to 53.7% because of fees paid to the trustee-manager in units.
A representative of Dasin’s manager said: “for the ARA deal, if and when there are further updates from the Chairman and controlling shareholder of the Trustee-Manager, we will make the necessary announcements.”
Separately, as at May 4, the trustee-manager has announced that Aqua-Wealth Holdings, owned by Zhang, has pledged 38 million Dasin Retail Trust units, or 4.87% at that date, to CGS-CIMB. The units are pledged for the financing of Aqua Wealth's trades in securities with or through CGS-CIMB.
Unrelated to the pledged shares, almost $500 million of debt comes due on July 18. Of this, $419.5 million is offshore debt, and $80.1 million is onshore debt. The market grapevine says that the financing is taking a little longer and ARA could be stepping in as part of the syndicated loan.
“We will make the announcement to update the market upon entering into a refinancing agreement,” Dasin’s manager says via email.
Dasin is not the only property trust under presssure. Keppel DC REIT is at a one-year low. Technically, it broke below the twice-tested $2.53 level, indicating a downside of $2.33. At present, short term indicators are sufficiently oversold to trigger a rebound, and minor support at $2.40 could also lead to a bounce. Resistance for the bounce is at $2.53. Its 1HFY2021 results due out later this month, could shed more light into the sell-down. By then, prices could have bottomed.
RH Petrogas formed what looks like a shooting star on July 2. Prices peaked at just under 20 cents on June 16. However the move up to that level took place in two trading sessions, and ended in a minor top formation on the candlestick chart. A clear negative divergence has developed between smoothed RSI and price. Although prices closed at 17.6 cents on July 2, support at 17.5 cents has been attacked and is now a weak support. A break below this level would cause further selling pressure, and indicate a downside objective.
The Straits Times Index has fluctuated somewhat these part four trading sessions. It eased all the way to 3,089 on June 29, before rebounding to 3,128 on July 2. The 3,089 to 3,090 level should be viewed as a support. This has caused short-term indicators to turn up from relatively low levels - but not from the bottom of their range. Hence the current rebound may run into resistance at it approaches its 50-day moving average at 3,154.
Directional Movement Indicators are mildly negative because ADX has turned up and the DIs are negatively placed. Quarterly momentum is relatively neutral. The STI needs to break above 3,158 to regain up-momentum.