SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Asia’s leading multi-asset exchange

Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Equity Bottom-Up

<figure>
 <img src='https://api2.sgx.com/sites/default/files/2021-06/Capture_4.PNG' alt='S-REITs ' />
 </figure>
 <div class='content-caption'>S-REITs </div>
<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd">
<html><body>
Singapore real estate investment trusts (S-Reits) and property trusts continue to increase assets under management (AUMs).

This year, 15 acquisitions have been announced valued at over S$5 billion. Of these, 11 were industrial and logistics-related properties.

Three of the largest announced were by Mapletree Industrial Trust (MIT), Ascendas Reit and Frasers Logistics &amp; Commercial Trust (FLCT).

MIT proposed in May to buy 29 data centres across 18 states in the United States for close to S$1.8 billion. MIT said the acquisition aligns with its strategy to increase its portfolio of data centres, and diversifies MIT's footprint across US data centre markets. Its portfolio of data centres will increase to S$4.6 billion (or 53.6 per cent of its total portfolio) post-acquisition, making MIT one of the largest owners of data centres among Asia-Pacific-listed Reits by AUM. 
Ascendas Reit announced in March the acquisition of 11 data centres across the United Kingdom, the Netherlands, France and Switzerland for S$904.6 million. Ninety-three per cent of the acquired portfolio is located in key European data centre markets that benefit from being close and connected to large population centres. The acquisition expands the Reit's existing data centre portfolio from 4 per cent to 10 per cent.

FLCT proposed in May to buy six properties in Germany, the Netherlands and the UK for S$548.7 million. The six properties include four logistics and industrial properties in Germany and the Netherlands, and a logistics and industrial property as well as a business park in the UK. This marks the Reit's maiden entry into the UK logistics sector.  REIT Watch is a weekly column on The Business Times, <a href="https://www.businesstimes.com.sg/companies-markets/s-reits-ytd-asset-acquisitions-exceed-s5-billion">read</a> the original version.
</body></html>


      
    
    S-REITs 


Singapore real estate investment trusts (S-Reits) and property trusts continue to increase assets under management (AUMs).

This year, 15 acquisitions have been announced valued at over S$5 billion. Of these, 11 were industrial and logistics-related properties.

Three of the largest announced were by Mapletree Industrial Trust (MIT), Ascendas Reit and Frasers Logistics &amp; Commercial Trust (FLCT).

MIT proposed in May to buy 29 data centres across 18 states in the United States for close to S$1.8 billion. MIT said the acquisition aligns with its strategy to increase its portfolio of data centres, and diversifies MIT's footprint across US data centre markets. Its portfolio of data centres will increase to S$4.6 billion (or 53.6 per cent of its total portfolio) post-acquisition, making MIT one of the largest owners of data centres among Asia-Pacific-listed Reits by AUM.  
Ascendas Reit announced in March the acquisition of 11 data centres across the United Kingdom, the Netherlands, France and Switzerland for S$904.6 million. Ninety-three per cent of the acquired portfolio is located in key European data centre markets that benefit from being close and connected to large population centres. The acquisition expands the Reit's existing data centre portfolio from 4 per cent to 10 per cent.

FLCT proposed in May to buy six properties in Germany, the Netherlands and the UK for S$548.7 million. The six properties include four logistics and industrial properties in Germany and the Netherlands, and a logistics and industrial property as well as a business park in the UK. This marks the Reit's maiden entry into the UK logistics sector.   REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - S-Reits' YTD asset acquisitions exceed S$5 billion

Frasers Hospitality Trust / Equity Bottom-Up

<figure>
 <img src='https://api2.sgx.com/sites/default/files/2021-05/Capture_20.PNG' alt='Frasers Group' />
 </figure>
 <div class='content-caption'>Frasers Group</div>
<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd">
<html><body>
FRASERS Property is one of Singapore's largest property groups with S$39.2 billion in total assets as at March 31, 2021.

The group develops, owns and manages an integrated portfolio of properties across residential, hospitality, retail, commercial and business parks, and in industrial and logistics sectors across Asia, Australia, Europe, the Middle East and Africa, and China.

With a S$4.6 billion market capitalisation, Frasers Property is the sponsor of three SGX-listed trusts - Frasers Centrepoint Trust (FCT), Frasers Logistics &amp; Commercial Trust (FLCT), and Frasers Hospitality Trust (FHT).

FLCT has 97 logistics, industrial and commercial properties across Australia, Singapore, Germany, the UK and the Netherlands. 
The Reit achieved a record revenue of S$231.7 million and adjusted net property income (NPI) of S$173.9 million, representing increases of 95.1 per cent and 79.3 per cent year-on-year respectively in H1FY21, mainly from the merger with Frasers Commercial Trust last April. 
It announced 3.80 cents in distribution per unit (DPU), up 9.5 per cent year-on-year, and a portfolio occupancy rate of 96.8 per cent.

Its majority exposure to resilient sub-sectors industrial and logistics (at 58.3 per cent of its portfolio value) amid the pandemic can be seen in the Reit's 37.8 per cent total returns in the past one year. It is the second best performing among S-Reits.

FLCT entered the Straits Times Index in April 2021 and has obtained a BBB+ with stable outlook credit rating from S&amp;P Global Ratings.

FCT is one of Singapore's largest suburban retail landlords with 10 malls with a total AUM of S$6.4 billion.

The Reit reported 73.8 per cent growth in both revenue and NPI for H1FY21 at S$173.6 million and S$125.7 million respectively, mainly from its latest AsiaRetail Fund portfolio. The Reit announced a DPU of 5.996 cents, 28.4 per cent higher year-on-year.

It noted that tenants' sales have recovered to near pre-Covid-19 levels, despite shopper traffic still lagging due to safe distancing measures. Its retail portfolio occupancy has held up at 96.1 per cent and average reversion was at -0.7 per cent.

FCT recently announced that the property owner of Waterway Point, of which it owns 40 per cent, has been awarded its first green loan of S$589 million, lifting FCT's proportion of green loans to 18 per cent.

FHT is a global hotel and serviced residence trust with 15 properties across nine cities and an appraised portfolio value of S$2.25 billion as at Sept 30, 2020.

In its H1FY21 results, the trust reported year-on-year declines of 36.2 per cent and 40.9 per cent in revenue and NPI respectively, as the sector continues to be affected by the pandemic.

However, on a half-year comparison, FHT has shown signs of improvement with 53.8 per cent and 83.5 per cent increases in revenue and NPI respectively, driven by better performance in its Australia portfolio.

The trust retained 60 per cent of its distributable income and reported lower distribution per stapled security of 0.179 cents.

FHT believes that domestic tourism may recover faster than international tourism given the pent-up demand for travel and views countries where it has a presence in such as Australia, Japan and the UK, to be best positioned for earlier recovery.  REIT Watch is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/china-poised-to-drive-economic-growth"> </a><a href="https://www.businesstimes.com.sg/companies-markets/growing-sustainably-with-frasers-s-reits">read</a><a href="https://www.businesstimes.com.sg/companies-markets/bulk-of-s-reits-in-key-global-real-estate-indices"> </a>the original version.
</body></html>


      
    
    Frasers Group


FRASERS Property is one of Singapore's largest property groups with S$39.2 billion in total assets as at March 31, 2021.

The group develops, owns and manages an integrated portfolio of properties across residential, hospitality, retail, commercial and business parks, and in industrial and logistics sectors across Asia, Australia, Europe, the Middle East and Africa, and China.

With a S$4.6 billion market capitalisation, Frasers Property is the sponsor of three SGX-listed trusts - Frasers Centrepoint Trust (FCT), Frasers Logistics &amp; Commercial Trust (FLCT), and Frasers Hospitality Trust (FHT).

FLCT has 97 logistics, industrial and commercial properties across Australia, Singapore, Germany, the UK and the Netherlands.  
The Reit achieved a record revenue of S$231.7 million and adjusted net property income (NPI) of S$173.9 million, representing increases of 95.1 per cent and 79.3 per cent year-on-year respectively in H1FY21, mainly from the merger with Frasers Commercial Trust last April.  
It announced 3.80 cents in distribution per unit (DPU), up 9.5 per cent year-on-year, and a portfolio occupancy rate of 96.8 per cent.

Its majority exposure to resilient sub-sectors industrial and logistics (at 58.3 per cent of its portfolio value) amid the pandemic can be seen in the Reit's 37.8 per cent total returns in the past one year. It is the second best performing among S-Reits.

FLCT entered the Straits Times Index in April 2021 and has obtained a BBB+ with stable outlook credit rating from S&amp;P Global Ratings.

FCT is one of Singapore's largest suburban retail landlords with 10 malls with a total AUM of S$6.4 billion.

The Reit reported 73.8 per cent growth in both revenue and NPI for H1FY21 at S$173.6 million and S$125.7 million respectively, mainly from its latest AsiaRetail Fund portfolio. The Reit announced a DPU of 5.996 cents, 28.4 per cent higher year-on-year.

It noted that tenants' sales have recovered to near pre-Covid-19 levels, despite shopper traffic still lagging due to safe distancing measures. Its retail portfolio occupancy has held up at 96.1 per cent and average reversion was at -0.7 per cent.

FCT recently announced that the property owner of Waterway Point, of which it owns 40 per cent, has been awarded its first green loan of S$589 million, lifting FCT's proportion of green loans to 18 per cent.

FHT is a global hotel and serviced residence trust with 15 properties across nine cities and an appraised portfolio value of S$2.25 billion as at Sept 30, 2020.

In its H1FY21 results, the trust reported year-on-year declines of 36.2 per cent and 40.9 per cent in revenue and NPI respectively, as the sector continues to be affected by the pandemic.

However, on a half-year comparison, FHT has shown signs of improvement with 53.8 per cent and 83.5 per cent increases in revenue and NPI respectively, driven by better performance in its Australia portfolio.

The trust retained 60 per cent of its distributable income and reported lower distribution per stapled security of 0.179 cents.

FHT believes that domestic tourism may recover faster than international tourism given the pent-up demand for travel and views countries where it has a presence in such as Australia, Japan and the UK, to be best positioned for earlier recovery.   REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - Growing sustainably with Frasers' S-Reits

Research from SooChow CSSD Capital Markets (Asia), SCCM Asia Research

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<h2>Singapore</h2><h3>SREITs results in a glance (see detailed spreadsheet and calendar attached)</h3><table class="table table-striped"><tbody><tr><td style="width: 141.25pt;"> </td><td style="width: 141.2pt;">PRIME (US$)</td><td style="width: 141.2pt;">KORE (US$)</td><td style="width: 141.2pt;">MUST (US$)</td></tr><tr><td style="width: 141.25pt;">Period</td><td style="width: 141.2pt;">1Q21</td><td style="width: 141.2pt;">1Q21</td><td style="width: 141.2pt;">1Q21</td></tr><tr><td style="width: 141.25pt;">Gross Revenue (S$ m)</td><td style="width: 141.2pt;">35.9 (+2.5% YoY)</td><td style="width: 141.2pt;">34.6 (-2.1% YoY)</td><td style="width: 141.2pt;">NA</td></tr><tr><td style="width: 141.25pt;">NPI (S$ m)</td><td style="width: 141.2pt;">23.0 (-2.0% YoY)</td><td style="width: 141.2pt;">20.4 (-2.8% YoY)</td><td style="width: 141.2pt;">NA</td></tr><tr><td style="width: 141.25pt;">DPU (S$ c)</td><td style="width: 141.2pt;">Not Disclosed</td><td style="width: 141.2pt;">Not Disclosed</td><td style="width: 141.2pt;">NA</td></tr><tr><td style="width: 141.25pt;">NAV per Unit (S$)</td><td style="width: 141.2pt;">Not Disclosed</td><td style="width: 141.2pt;">Not Disclosed</td><td style="width: 141.2pt;">0.730</td></tr><tr><td style="width: 141.25pt;">P/B (x)</td><td style="width: 141.2pt;">0.99(Based on 4Q20 NAV)</td><td style="width: 141.2pt;">0.90 (Based on 4Q20 NAV)</td><td style="width: 141.2pt;">1.030 (Based on 4Q20 NAV)</td></tr><tr><td style="width: 141.25pt;">Occupancy (%)</td><td style="width: 141.2pt;">91.7</td><td style="width: 141.2pt;">91.6</td><td style="width: 141.2pt;">92.0</td></tr><tr><td style="width: 141.25pt;">Reversion (%)</td><td style="width: 141.2pt;">8.5</td><td style="width: 141.2pt;">5.7</td><td style="width: 141.2pt;">2.1</td></tr><tr><td style="width: 141.25pt;">Gearing (%)</td><td style="width: 141.2pt;">33.6</td><td style="width: 141.2pt;">37.5</td><td style="width: 141.2pt;">41.3</td></tr><tr><td style="width: 141.25pt;">Cost of Debt (%)</td><td style="width: 141.2pt;">2.8</td><td style="width: 141.2pt;">2.82</td><td style="width: 141.2pt;">3.18</td></tr><tr><td style="width: 141.25pt;">1 Yr Fwd Yield (%)</td><td style="width: 141.2pt;">8.24</td><td style="width: 141.2pt;">8.3</td><td style="width: 141.2pt;">8.00</td></tr><tr><td style="width: 141.25pt;">Debt Hedged (%)</td><td style="width: 141.2pt;">90.0</td><td style="width: 141.2pt;">84.7</td><td style="width: 141.2pt;">NA</td></tr><tr><td style="width: 141.25pt;">Target Price</td><td style="width: 141.2pt;">NA</td><td style="width: 141.2pt;">NA</td><td style="width: 141.2pt;">NA</td></tr><tr><td style="width: 141.25pt;">Rating</td><td style="width: 141.2pt;">NA</td><td style="width: 141.2pt;">NA</td><td style="width: 141.2pt;">NA</td></tr></tbody></table><h3><a href="https://www.smartkarma.com/entities/prime-us-reit" target="_blank" data-smartkarma-citation="entities:28144" rel="noopener">Prime US REIT (PRIME SP)</a> 1Q21 Business Update – Robust operations metrics; Trading at an attractive 8+% USD yield  </h3><ul><li>1Q21 revenue and NPI came in +2.5% YoY and -2.0% YoY, respectively, to US$35.9m (25.2% BB est) and US$23.5m (26.7% BB est). 1Q21 DI came in -1.2% YoY at US$17.6m, which benefitted from lower interest cost. 1Q21 DPU was undisclosed</li><li>Leasing momentum remained robust with a positive rental reversion of +8.5% in 1Q21 (vs +8.7% in 4Q20 and +8.9% in 3Q20). Focusing on long-term leases – 57,647sqft of long-term leases were executed in 1Q21 at a rental reversion of +9.5%. Below-market portfolio in place rents (by 6.5%) also provide a buffer for rental reversion potential</li><li>Overall portfolio committed occupancy fell to 91.7% in 1Q21 (vs. 92.4% in 4Q20 and 92.6% in 3Q20). PRIME has ~100% of cash rental income with built-in rental escalations averaging over +2% pa. Portfolio occupancy still well above Class-A office average of 84.3%. Rent collections remained robust at 99% with minimal rent concessions. Portfolio WALE stood at 4.3%</li><li>Portfolio gearing stands at 33.8% (vs. 33.5% in 4Q20 and 32.7% in 3Q20) with average cost of debt of 2.8% pa. (vs. 2.7% in 4Q20 and 2.7% in 3Q20) and 90.0% of debt hedged</li><li>PRIME currently trades at 8.24% FY21E yield and 0.99x P/B.</li></ul>

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached) PRIME (US$)KORE (US$)MUST (US$)Period1Q211Q211Q21Gross Revenue (S$ m)35.9 (+2.5% YoY)34.6 (-2.1% YoY)NANPI (S$ m)23.0 (-2.0% YoY)20.4 (-2.8% YoY)NADPU (S$ c)Not DisclosedNot DisclosedNANAV per Unit (S$)Not DisclosedNot Disclosed0.730P/B (x)0.99(Based on 4Q20 NAV)0.90 (Based on 4Q20 NAV)1.030 (Based on 4Q20 NAV)Occupancy (%)91.791.692.0Reversion (%)8.55.72.1Gearing (%)33.637.541.3Cost of Debt (%)2.82.823.181 Yr Fwd Yield (%)8.248.38.00Debt Hedged (%)90.084.7NATarget PriceNANANARatingNANANAPrime US REIT (PRIME SP) 1Q21 Business Update – Robust operations metrics; Trading at an attractive 8+% USD yield  1Q21 revenue and NPI came in +2.5% YoY and -2.0% YoY, respectively, to US$35.9m (25.2% BB est) and US$23.5m (26.7% BB est). 1Q21 DI came in -1.2% YoY at US$17.6m, which benefitted from lower interest cost. 1Q21 DPU was undisclosedLeasing momentum remained robust with a positive rental reversion of +8.5% in 1Q21 (vs +8.7% in 4Q20 and +8.9% in 3Q20). Focusing on long-term leases – 57,647sqft of long-term leases were executed in 1Q21 at a rental reversion of +9.5%. Below-market portfolio in place rents (by 6.5%) also provide a buffer for rental reversion potentialOverall portfolio committed occupancy fell to 91.7% in 1Q21 (vs. 92.4% in 4Q20 and 92.6% in 3Q20). PRIME has ~100% of cash rental income with built-in rental escalations averaging over +2% pa. Portfolio occupancy still well above Class-A office average of 84.3%. Rent collections remained robust at 99% with minimal rent concessions. Portfolio WALE stood at 4.3%Portfolio gearing stands at 33.8% (vs. 33.5% in 4Q20 and 32.7% in 3Q20) with average cost of debt of 2.8% pa. (vs. 2.7% in 4Q20 and 2.7% in 3Q20) and 90.0% of debt hedgedPRIME currently trades at 8.24% FY21E yield and 0.99x P/B.

ASEAN Builder's Scoop (19May21) - PRIME robust operations metrics

<h2>Singapore</h2><h3>SREITs results in a glance (see detailed spreadsheet and calendar attached)</h3><table class="table table-striped"><tbody><tr><td style="width: 162.6pt;"> </td><td style="width: 162.5pt;">ECWREIT</td><td style="width: 162.5pt;">SASSR</td><td style="width: 162.5pt;">BHGREIT</td></tr><tr><td style="width: 162.6pt;">Period</td><td style="width: 162.5pt;">1Q21</td><td style="width: 162.5pt;">1Q21</td><td style="width: 162.5pt;">1Q21</td></tr><tr><td style="width: 162.6pt;">Gross Revenue (S$ m)</td><td style="width: 162.5pt;">30.8 (+30.9% YoY)</td><td style="width: 162.5pt;">EMA Rental Income: 34.1 (+23.4% YoY)</td><td style="width: 162.5pt;">Not Disclosed</td></tr><tr><td style="width: 162.6pt;">NPI (S$ m)</td><td style="width: 162.5pt;">27.7 (+30.9% YoY)</td><td style="width: 162.5pt;">EMA Rental Income (Excluding straight-line adjustments): 32.3 (+27.8% YoY)</td><td style="width: 162.5pt;">Not Disclosed</td></tr><tr><td style="width: 162.6pt;">DPU (S$ c)</td><td style="width: 162.5pt;">1.53</td><td style="width: 162.5pt;">1.759 (+31.9% YoY)</td><td style="width: 162.5pt;">Not Disclosed</td></tr><tr><td style="width: 162.6pt;">NAV per Unit (S$)</td><td style="width: 162.5pt;">0.91</td><td style="width: 162.5pt;">0.922</td><td style="width: 162.5pt;">Not Disclosed</td></tr><tr><td style="width: 162.6pt;">P/B (x)</td><td style="width: 162.5pt;">0.81</td><td style="width: 162.5pt;">1.00</td><td style="width: 162.5pt;">0.64(Based on 4Q20 NAV)</td></tr><tr><td style="width: 162.6pt;">Occupancy (%)</td><td style="width: 162.5pt;"> 99.1</td><td style="width: 162.5pt;">93.5</td><td style="width: 162.5pt;">92.1</td></tr><tr><td style="width: 162.6pt;">Reversion (%)</td><td style="width: 162.5pt;"> NA</td><td style="width: 162.5pt;">Not Disclosed</td><td style="width: 162.5pt;">Not Disclosed</td></tr><tr><td style="width: 162.6pt;">Gearing (%)</td><td style="width: 162.5pt;">38.3</td><td style="width: 162.5pt;">27.6</td><td style="width: 162.5pt;">35.6</td></tr><tr><td style="width: 162.6pt;">Cost of Debt (%)</td><td style="width: 162.5pt;">4.1</td><td style="width: 162.5pt;">3.3</td><td style="width: 162.5pt;">3.8</td></tr><tr><td style="width: 162.6pt;">1 Yr Fwd Yield (%)</td><td style="width: 162.5pt;">7.76</td><td style="width: 162.5pt;">7.46</td><td style="width: 162.5pt;">NA</td></tr><tr><td style="width: 162.6pt;">Debt Hedged (%)</td><td style="width: 162.5pt;">100% of offshore facilities</td><td style="width: 162.5pt;">Not Disclosed</td><td style="width: 162.5pt;">60% of offshore loans</td></tr><tr><td style="width: 162.6pt;">Target Price</td><td style="width: 162.5pt;">Under Review</td><td style="width: 162.5pt;">NA</td><td style="width: 162.5pt;">NA</td></tr><tr><td style="width: 162.6pt;">Rating</td><td style="width: 162.5pt;">Under Review</td><td style="width: 162.5pt;">NA</td><td style="width: 162.5pt;">NA</td></tr></tbody></table><h3><a href="https://www.smartkarma.com/entities/ec-world-reit" target="_blank" data-smartkarma-citation="entities:22842" rel="noopener">EC World Reit (ECWREIT SP)</a> 1Q21 DPU +32.3% YoY; Robust growth but DI retention persist with retained DI snowballing to S$5.49m</h3><ul><li>Both revenue and NPI grew by 30.9% YoY in 1Q21 to S$30.8m (26.9% BB est.) and S$27.7m (28.1% BB est.), respectively, mainly due to absence of rental rebates in 1Q20 and strengthening of RMB. In RMB terms, gross revenue and NPI were 26.0% and 26.1% YoY higher, respectively</li><li>1Q21 DPU increased 32.3% YoY or 7.4% QoQ to S$1.532c (26.9% BB est.), mainly due to absence of rental rebates given. ECWREIT continued to retain 10% of DI in 1Q21 (vs. 10% in 4Q20 and 5% in 1Q20) on a conservative view of uncertainties arising from prolonged COVID-19 pandemic globally and for general working capital purpose</li><li>ECWREIT has secured renewal of major lease at Hengde Logistics, extending WALE to 3.2 years (by GRI) from 3.1 years as at 31Mar21. ~11.8% of GRI will be due for renewal for the remaining of FY21E</li><li>Portfolio occupancy remains robust at 99.1% (vs. 99.3% in 4Q20 and 96.7% in 3Q20)</li><li>On 30Apr, ECWREIT announced an incident of a displacement and collapse of a berth at Chongxian Port Investment that resulted in the damage of two gantry cranes located within the vicinity of the berth. Due to the location of the damaged area, the operations at the damaged berth and the 2 adjacent berths have been suspended. The rest of the port operation is not affected. The cause of the incident is still being investigated. ECWREIT is working closely with the insurer to assess the quantum of revenue loss and property damage recoverable by insurance claims</li><li>Portfolio gearing stands at 38.3% (vs. 38.1% in 4Q20 and 38.6% in 1Q20) with average cost of debt of 4.1% pa. (vs. 4.2% in 4Q20 and 4.3% in 1Q20) and 100% of offshore facilities hedged</li><li>ECWREIT currently trades at 7.76% FY21E yield and 0.81x P/B.</li></ul>Comments: 1Q21 revenue and NPI came in at 26.5% and 26.0% of our full-year FY21E estimates, respectively. Meanwhile, 1Q21 DPU came in at 27.5% of FY21E estimates. Note that we have assumed a 10% DI retention for FY21E, the higher than expected 1Q21 DPU was due to a lower 1Q21 tax rate at 24.7% (vs. our projected 38.0%). Including 1Q21’s S$1.38m, total retained DI since 1Q20 has amounted to S$5.49m (or S$0.681c per Unit). Port Logistics had done well in 1Q21, with revenue increasing 40.4% YoY to S$12.7m, and NPI increasing 41.8% YoY to S$11.9m (NPI margin +0.9pp. YoY to 93.5%). E-commerce Logistics has also recorded a strong 1Q21 growth, with revenue and NPI rising 32.4% and 30.9% YoY to S$14.7m and S$12.7m, respectively (NPI margin -1.0% to 86.5%). On the other hand, Specialised Logistics was muted in 1Q21, with Revenue and NPI flattish YoY at S$3.4m and S$3.1m, respectively (NPI margin +0.7pp. to 90.7%). While insurance claims could offset the revenue loss and restoration costs somewhat, we are cognizant that Chongxian Port Investment contributed to ~27% and ~28% of FY20 Revenue and NPI, respectively. We are currently reviewing our recommendations for ECWREIT.

SingaporeSREITs results in a glance (see detailed spreadsheet and calendar attached) ECWREITSASSRBHGREITPeriod1Q211Q211Q21Gross Revenue (S$ m)30.8 (+30.9% YoY)EMA Rental Income: 34.1 (+23.4% YoY)Not DisclosedNPI (S$ m)27.7 (+30.9% YoY)EMA Rental Income (Excluding straight-line adjustments): 32.3 (+27.8% YoY)Not DisclosedDPU (S$ c)1.531.759 (+31.9% YoY)Not DisclosedNAV per Unit (S$)0.910.922Not DisclosedP/B (x)0.811.000.64(Based on 4Q20 NAV)Occupancy (%) 99.193.592.1Reversion (%) NANot DisclosedNot DisclosedGearing (%)38.327.635.6Cost of Debt (%)4.13.33.81 Yr Fwd Yield (%)7.767.46NADebt Hedged (%)100% of offshore facilitiesNot Disclosed60% of offshore loansTarget PriceUnder ReviewNANARatingUnder ReviewNANAEC World Reit (ECWREIT SP) 1Q21 DPU +32.3% YoY; Robust growth but DI retention persist with retained DI snowballing to S$5.49mBoth revenue and NPI grew by 30.9% YoY in 1Q21 to S$30.8m (26.9% BB est.) and S$27.7m (28.1% BB est.), respectively, mainly due to absence of rental rebates in 1Q20 and strengthening of RMB. In RMB terms, gross revenue and NPI were 26.0% and 26.1% YoY higher, respectively1Q21 DPU increased 32.3% YoY or 7.4% QoQ to S$1.532c (26.9% BB est.), mainly due to absence of rental rebates given. ECWREIT continued to retain 10% of DI in 1Q21 (vs. 10% in 4Q20 and 5% in 1Q20) on a conservative view of uncertainties arising from prolonged COVID-19 pandemic globally and for general working capital purposeECWREIT has secured renewal of major lease at Hengde Logistics, extending WALE to 3.2 years (by GRI) from 3.1 years as at 31Mar21. ~11.8% of GRI will be due for renewal for the remaining of FY21EPortfolio occupancy remains robust at 99.1% (vs. 99.3% in 4Q20 and 96.7% in 3Q20)On 30Apr, ECWREIT announced an incident of a displacement and collapse of a berth at Chongxian Port Investment that resulted in the damage of two gantry cranes located within the vicinity of the berth. Due to the location of the damaged area, the operations at the damaged berth and the 2 adjacent berths have been suspended. The rest of the port operation is not affected. The cause of the incident is still being investigated. ECWREIT is working closely with the insurer to assess the quantum of revenue loss and property damage recoverable by insurance claimsPortfolio gearing stands at 38.3% (vs. 38.1% in 4Q20 and 38.6% in 1Q20) with average cost of debt of 4.1% pa. (vs. 4.2% in 4Q20 and 4.3% in 1Q20) and 100% of offshore facilities hedgedECWREIT currently trades at 7.76% FY21E yield and 0.81x P/B.Comments: 1Q21 revenue and NPI came in at 26.5% and 26.0% of our full-year FY21E estimates, respectively. Meanwhile, 1Q21 DPU came in at 27.5% of FY21E estimates. Note that we have assumed a 10% DI retention for FY21E, the higher than expected 1Q21 DPU was due to a lower 1Q21 tax rate at 24.7% (vs. our projected 38.0%). Including 1Q21’s S$1.38m, total retained DI since 1Q20 has amounted to S$5.49m (or S$0.681c per Unit). Port Logistics had done well in 1Q21, with revenue increasing 40.4% YoY to S$12.7m, and NPI increasing 41.8% YoY to S$11.9m (NPI margin +0.9pp. YoY to 93.5%). E-commerce Logistics has also recorded a strong 1Q21 growth, with revenue and NPI rising 32.4% and 30.9% YoY to S$14.7m and S$12.7m, respectively (NPI margin -1.0% to 86.5%). On the other hand, Specialised Logistics was muted in 1Q21, with Revenue and NPI flattish YoY at S$3.4m and S$3.1m, respectively (NPI margin +0.7pp. to 90.7%). While insurance claims could offset the revenue loss and restoration costs somewhat, we are cognizant that Chongxian Port Investment contributed to ~27% and ~28% of FY20 Revenue and NPI, respectively. We are currently reviewing our recommendations for ECWREIT.

ASEAN Builder's Scoop (12May21) - ECWREIT strong growth despite retention

<figure>
 <img src='https://api2.sgx.com/sites/default/files/2021-05/S-REITS%20distributions.PNG' alt='S-REITS distributions' />
 </figure>
 <div class='content-caption'>S-REITS distributions</div>
<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN" "http://www.w3.org/TR/REC-html40/loose.dtd">
<html><body>
ENTERING the earnings season the first quarter of 2021, 14 S-Reits had reported their distributions per unit (DPUs) as at end April, averaging a 31 per cent increase year on year (yoy). Another 10 S-Reits are expected to announce quarterly business updates or financial results in May.

Of the 14 S-Reits that reported, 12 saw a yoy increase in DPU. The five S-Reits with the highest yoy DPU increments are: SPH Reit (+313.3 per cent), Mapletree Commercial Trust (+57.9 per cent), ARA Logos Logistics Trust (+35.7 per cent), Frasers Centrepoint Trust (28.4 per cent) and Keppel DC Reit (18.1 per cent).

SPH Reit declared a DPU of 1.24 Singapore cents for Q2 FY2021 ended Feb 28 - a 313.3 per cent increase yoy. Its near-term focus is to maintain healthy occupancy and sustainable rental income in partnership with tenants. SPH Reit's portfolio occupancy rate stands at 98 per cent as at Feb 28, compared to 98.9 per cent a year ago.

Mapletree Commercial Trust (MCT) declared a DPU of 5.32 Singapore cents for H2 FY21 ended March 31, up 57.9 per cent yoy, bringing full year DPU to 9.49 Singapore cents. The latest declared DPU includes the release of S$13.0 million from the retained cash carried forward from Q4 FY20.

MCT said monthly tenant sales in Q4 FY21 have recovered to more than 86 per cent of pre-Covid levels.

ARA Logos Logistics Trust (ALOG) declared a DPU of 1.353 Singapore cents for Q1 FY21, representing a 35.7 per cent increment yoy. The increase in DPU, though partly due to the retention of S$2.5 million distributable income in Q1 FY20, was also contributed by the 8.7 per cent yoy rise in NPI.

ALOG said the stronger portfolio performance was due to the commencement of new leases at several properties as well as higher revenue generated from the Australia portfolio on the back of the strengthening Australian dollar. As at end-March, ALOG's portfolio committed occupancy rose to 99.1 per cent.

Frasers Centrepoint Trust (FCT) declared H1 FY21 DPU of 5.996 Singapore cents, up 28.4 per cent yoy. This marks its first set of financial results since the acquisition of the remaining 63.11 per cent stake in AsiaRetail Fund Ltd in October. FCT said its retail portfolio occupancy remained stable at 96.1 per cent. FCT expects the vaccination programme in Singapore and continued re-opening of the economy to support the recovery of shopper traffic and tenants' sales.

Keppel DC Reit (KDCREIT) reported DPU of 2.462 Singapore cents for Q1 FY21, representing an 18.1 per cent yoy increase. The DPU increment was attributed to contributions from new accretive acquisitions and asset enhancement initiatives in 2020. Note that KDCREIT pays distributions on a semi-annual basis, and no distribution will be paid for Q1 FY2021. 

REIT Watch is a weekly column on The Business Times, <a href="https://www.businesstimes.com.sg/companies-markets/14-s-reit-dpus-up-average-31-year-on-year">read</a><a href="https://www.businesstimes.com.sg/companies-markets/bulk-of-s-reits-in-key-global-real-estate-indices"> </a>the original version.
</body></html>


      
    
    S-REITS distributions


ENTERING the earnings season the first quarter of 2021, 14 S-Reits had reported their distributions per unit (DPUs) as at end April, averaging a 31 per cent increase year on year (yoy). Another 10 S-Reits are expected to announce quarterly business updates or financial results in May.

Of the 14 S-Reits that reported, 12 saw a yoy increase in DPU. The five S-Reits with the highest yoy DPU increments are: SPH Reit (+313.3 per cent), Mapletree Commercial Trust (+57.9 per cent), ARA Logos Logistics Trust (+35.7 per cent), Frasers Centrepoint Trust (28.4 per cent) and Keppel DC Reit (18.1 per cent).

SPH Reit declared a DPU of 1.24 Singapore cents for Q2 FY2021 ended Feb 28 - a 313.3 per cent increase yoy. Its near-term focus is to maintain healthy occupancy and sustainable rental income in partnership with tenants. SPH Reit's portfolio occupancy rate stands at 98 per cent as at Feb 28, compared to 98.9 per cent a year ago.

Mapletree Commercial Trust (MCT) declared a DPU of 5.32 Singapore cents for H2 FY21 ended March 31, up 57.9 per cent yoy, bringing full year DPU to 9.49 Singapore cents. The latest declared DPU includes the release of S$13.0 million from the retained cash carried forward from Q4 FY20.

MCT said monthly tenant sales in Q4 FY21 have recovered to more than 86 per cent of pre-Covid levels.

ARA Logos Logistics Trust (ALOG) declared a DPU of 1.353 Singapore cents for Q1 FY21, representing a 35.7 per cent increment yoy. The increase in DPU, though partly due to the retention of S$2.5 million distributable income in Q1 FY20, was also contributed by the 8.7 per cent yoy rise in NPI.

ALOG said the stronger portfolio performance was due to the commencement of new leases at several properties as well as higher revenue generated from the Australia portfolio on the back of the strengthening Australian dollar. As at end-March, ALOG's portfolio committed occupancy rose to 99.1 per cent.

Frasers Centrepoint Trust (FCT) declared H1 FY21 DPU of 5.996 Singapore cents, up 28.4 per cent yoy. This marks its first set of financial results since the acquisition of the remaining 63.11 per cent stake in AsiaRetail Fund Ltd in October. FCT said its retail portfolio occupancy remained stable at 96.1 per cent. FCT expects the vaccination programme in Singapore and continued re-opening of the economy to support the recovery of shopper traffic and tenants' sales.

Keppel DC Reit (KDCREIT) reported DPU of 2.462 Singapore cents for Q1 FY21, representing an 18.1 per cent yoy increase. The DPU increment was attributed to contributions from new accretive acquisitions and asset enhancement initiatives in 2020. Note that KDCREIT pays distributions on a semi-annual basis, and no distribution will be paid for Q1 FY2021. 

REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - 14 S-Reit DPUs up average 31% year on year

Singapore

Frasers Property Limited provides real estate ownership and development services. The Company engages in the development of land, housing projects, apartments, as well as commercial, industrial, and retail properties. Frasers Property serves customers globally.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Frasers Property Ltd (FPL SP)

REIT Watch - S-Reits' YTD asset acquisitions exceed S$5 billion

Singapore real estate investment trusts (S-Reits) and property trusts continue to increase assets under management...

Singapore Exchange Ltd (SGX)

REIT Watch - Growing sustainably with Frasers' S-Reits

FRASERS Property is one of Singapore's largest property groups with S$39.2 billion in total assets as at March 31, 2021. The...

Singapore Exchange Ltd (SGX)

ASEAN Builder's Scoop (19May21) - PRIME robust operations metrics

PRIME robust operations metrics; CIT plans for GBP500m SREIT IPO; FIRT completes restructuring; Retail landlords roll out tenants support; China...

SCCM Asia Research

ASEAN Builder's Scoop (12May21) - ECWREIT strong growth despite retention

ECWREIT strong growth despite retention; SASSR rebounded from a low-base; CAPL fund mgmt, resi the bright spots; FPL SG & AUS supporting growth;...

SCCM Asia Research

REIT Watch - 14 S-Reit DPUs up average 31% year on year

ENTERING the earnings season the first quarter of 2021, 14 S-Reits had reported their distributions per unit (DPUs) as at end...

Singapore Exchange Ltd (SGX)

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)