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Sabana REIT receives boost from NTP+, moving averages, as STI remains in corrective mode

The Edge Singapore
The Edge Singapore 4/16/2021 10:12 PM GMT+08  • 3 min read
Sabana REIT receives boost from NTP+, moving averages, as STI remains in corrective mode
Sabana REIT's unit price receives boost from NTP+ TOP, positive moving averages, while STI remains in corrective mode
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Sabana Shariah Compliant Industrial REIT’s new NTP+ Mall which was highlighted in this week’s publication was a pleasant surprise. No wonder its units strengthened after the manager announced, on March 10, that NTP+, which the manager described as a two-storey lifestyle mall spanning approximately 43,000 sq ft of gross floor area, comprising 25 retail and F&B units on the ground floor, and a foodcourt on the second level, received its temporary occupation permit. Donald Han, CEO of Sabana REIT told our journalists that committed occupancy is 97%. Han has also articulated that return on cost is likely to be double-digit.

Clearly, the announcement that NTP+ had received its TOP had an impact on the trading price. On March 9-10, Sabana REIT’s unit price was at 37.5 cents, a level it had been at for some months. But on March 11, prices closed at 38.5 cents as investors digested the NTP+ news. As a comparison, Sabana REIT ended 2020 at 35.5 cents. With its close on April 16 of 42 cents, Sabana REIT is up 18%.

SEE:Sabana REIT's NTP+ mall to open in 2Q2021

Technically too, the moving averages turned positive in early Feb, just as prices moved to 36 cents. Resistance appears at 46-47 cents, the trading range of the stock pre-Covid. Long-term investors however, can remain invested in Sabana REIT if they opt to take up the distribution reinvestment plan, which was first introduced in 2014 where units are issued usually at a 2% discount to the prevailing price.

Singapore Press Holdings is up 73% since the start of the year, and closing in on $2. At end-Dec, the stock was just above $1. While technical indicators continue to rise, and there are as yet no signs of a downturn by the short term indicators, 21-day RSI is just shy of 82, which is at least a two year high. At any rate, some traders may be interested in locking in profits.

For more stories about where the money flows, click here for our Capital section

The Straits Times Index’s quarterly momentum is struggling. In addition, short term stochastics and 21-day RSI are falling. This is despite the 17 point price rise week-on-week, of which a 16 point gain took place on April 16. In the immediate term, the STI’s range may narrow further, from 3,150-3,220, to 3,200-3220. The uptrend could resume towards the end of April. The original break above the narrow 3,071 to 3,118 range in the week of Mar 15-19 still remains valid as does the upside of 3,368 to 3,377.

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