Maybank Kim Eng analyst Chua Su Tye has kept his "buy" call on Mapletree Logistics Trust, but with an upgraded target price of $2.35 from $2.25 following its “strong” earnings for 1QFY22 ended June 30.

On July 19, thanks to higher rental income and contribution from recent acquisitions worth $1.6 billion, MLT reported a distribution per unit of 2.161 cents, up 5.7% y-o-y, which was ahead of consensus estimates.

“We expect occupancies to stay resilient on the back of steady demand growth, and raised DPUs by 4% on stronger rental assumptions,” writes Chua in his July 20 note.

During the quarter, MLT enjoyed better rental reversions of 2.2%, a slight dip from the 2.4% gain enjoyed in the preceding 4QFY2021, led mainly by its Vietnam, Hong Kong and Singapore properties.

See also: Mapletree Logistics Trust to raise $650.0 mil through equity fund

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Overall portfolio occupancy increased from 97.5% to 97.8%, and weighted average lease expiry (WALE) was stable at 3.8 years.

“We expect its occupancies to remain resilient, as demand continues to be driven by e-commerce tenancies and 3PLs,” says Chua.

“While its retail sector occupiers have adopted a wait-and-see approach, MLT is looking to drive rental upside from its higher value tenants in the next 9-12 months,” he adds.

MLT last traded at $2.10, down 0.94% on July 19.