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

Mapletree North Asia Commercial Trust / Equity Bottom-Up

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 <div class='content-caption'>Schedule of SREIT earnings</div>
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SPH Reit kicked off the current financial reporting season for S-Reits on Apr 1, 2022 with the release of its H1 FY2022 (ended Feb 28, 2022) financial results.

This was followed by 7 other S-Reits, including Keppel DC Reit (Q1 business update), Keppel Pacific Oak US Reit (Q1 business update), Mapletree North Asia Commercial Trust (full-year results), Keppel Reit (Q1 business update), Mapletree Commercial Trust (full-year results), Digital Core Reit (Q1 business update) and Sabana Industrial Reit (Q1 business update), over a 3-day period from Apr 19 to 21, 2022.

Another 22 S-Reits have also confirmed that they will unveil financial results or business updates between Apr 22, 2022 and May 12, 2022 for their respective periods ended Mar 31, 2022. 
Among them, 3 would be reporting full-year financial results, 4 would be reporting first-half or first-quarter financial results, and another 15 would be providing quarterly business updates.

Mapletree North Asia Commercial Trust (MNACT) and Mapletree Commercial Trust (MCT) have both released financial results for the full year from Apr 1, 2021 to Mar 31, 2022 (FY21/22) while Mapletree Industrial Trust and Mapletree Logistics Trust will be unveiling full-year results on Apr 26 and 28, respectively.

Both MNACT and MCT managers reiterated their confidence and commitment to the proposed merger of the 2 trusts, citing long-term value and scale of the merged entity. 
On Mar 21, 2022, the trusts announced an alternative option for MNACT unitholders to receive the scheme consideration wholly in cash, providing additional optionality and enhanced flexibility to MNACT unitholders who wish to fully realise their investment, given higher uncertainty amid prevailing market conditions.

Both trusts are expected to hold extraordinary general meetings (EGMs) to obtain approvals from unitholders by end May 2022. REIT Watch is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/singapore-office-s-reits-poised-to-benefit-from-positive-rental-momentum-0"> </a><a href="https://www.businesstimes.com.sg/companies-markets/upcoming-s-reits-earnings-releases-schedule-0">read </a>the original version.
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    Schedule of SREIT earnings


SPH Reit kicked off the current financial reporting season for S-Reits on Apr 1, 2022 with the release of its H1 FY2022 (ended Feb 28, 2022) financial results.

This was followed by 7 other S-Reits, including Keppel DC Reit (Q1 business update), Keppel Pacific Oak US Reit (Q1 business update), Mapletree North Asia Commercial Trust (full-year results), Keppel Reit (Q1 business update), Mapletree Commercial Trust (full-year results), Digital Core Reit (Q1 business update) and Sabana Industrial Reit (Q1 business update), over a 3-day period from Apr 19 to 21, 2022.

Another 22 S-Reits have also confirmed that they will unveil financial results or business updates between Apr 22, 2022 and May 12, 2022 for their respective periods ended Mar 31, 2022.  
Among them, 3 would be reporting full-year financial results, 4 would be reporting first-half or first-quarter financial results, and another 15 would be providing quarterly business updates.

Mapletree North Asia Commercial Trust (MNACT) and Mapletree Commercial Trust (MCT) have both released financial results for the full year from Apr 1, 2021 to Mar 31, 2022 (FY21/22) while Mapletree Industrial Trust and Mapletree Logistics Trust will be unveiling full-year results on Apr 26 and 28, respectively.

Both MNACT and MCT managers reiterated their confidence and commitment to the proposed merger of the 2 trusts, citing long-term value and scale of the merged entity.  
On Mar 21, 2022, the trusts announced an alternative option for MNACT unitholders to receive the scheme consideration wholly in cash, providing additional optionality and enhanced flexibility to MNACT unitholders who wish to fully realise their investment, given higher uncertainty amid prevailing market conditions.

Both trusts are expected to hold extraordinary general meetings (EGMs) to obtain approvals from unitholders by end May 2022.  REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - Upcoming S-Reits' earnings releases schedule

CapitaLand Ascendas REIT / Equity Bottom-Up

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 <div class='content-caption'>Tenant breakdown</div>
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The data centre industry has experienced tremendous growth in the past 2 years, as businesses are faced with a sudden and increased need for greater cloud capacity to enable work-from-home arrangements.

According to Cushman &amp; Wakefield's 2022 Global Data Center Market Comparison report, the top 10 markets with the greatest capacity under development include London, Northern Virginia, Silicon Valley, Atlanta, Chicago, Dublin, Hong Kong, Phoenix, Singapore and Jakarta.

The report also highlighted the 3 main types of challenges and responsibilities that data centre operators face. These include the ability to source for renewable energy, the ability to develop better methods of cooling servers and the ability to design more efficient facilities to meet the sustainability goals of clients and governments. 
In Singapore, data centres accounted for 7 per cent of Singapore's total electricity consumption in 2020.

Earlier this year, the moratorium on new data centres in Singapore was lifted, with certain criteria on energy efficiency.

Minister for Trade and Industry, Gan Kim Yong had said that the government had "to find a way to manage the growth of data centres in a sustainable manner consistent with our climate change commitments". 
SGX lists several Reits with substantial data centre assets, including Mapletree Industrial Trust,  Ascendas Reit and 2 pure play data centre Reits - Keppel DC Reit and Digital Core Reit.  
Keppel DC Reit (KDCReit), Asia's first pure-play data centre Reit, has 21 properties located across 9 countries in Asia-Pacific and Europe.

The Reit also has the right of first refusal for S$2 billion of potential data centre assets for acquisitions through its sponsor, Keppel T&amp;T as well as Keppel's private data centre funds.

In its most recent FY21 results, KDCReit posted a record high portfolio occupancy of 98.3 per cent and announced distribution per unit (DPU) of 9.851 cents, representing a 7.4 per cent year-on-year growth.

The Reit has also committed to progressively reduce its combined Scope 1 and Scope 2 emissions with an aim to halve it by 2030 from a 2019 baseline.

It also aims to introduce renewable energy to at least 50 per cent of its colocation assets by 2030, as well as encourage the use of renewable energy at all other portfolio assets.

Digital Core Reit, which listed on the SGX in 2021, has a portfolio of 10 data centres across the United States and Canada.

The Reit's core strategy includes investing in high-quality assets with strategic locations generating long-term pricing power and well-maintained physical structure.

Digital Core Reit has projected a DPU of 4.18 US cents for FY2022 and guided for a 5.3 per cent DPU growth in FY2023.

The Reit has committed to delivering sustainable growth for all stakeholders and aims to reduce Scope 1 and 2 emissions by 68 per cent and Scope 3 emissions by 24 per cent by 2030. REIT Watch is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/singapore-office-s-reits-poised-to-benefit-from-positive-rental-momentum-0"> </a><a href="https://www.businesstimes.com.sg/companies-markets/data-centre-s-reits-committed-to-sustainable-growth-0">read</a><a href="https://www.businesstimes.com.sg/companies-markets/singapore-office-s-reits-poised-to-benefit-from-positive-rental-momentum-0"> </a>the original version.
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    Tenant breakdown


The data centre industry has experienced tremendous growth in the past 2 years, as businesses are faced with a sudden and increased need for greater cloud capacity to enable work-from-home arrangements.

According to Cushman &amp; Wakefield's 2022 Global Data Center Market Comparison report, the top 10 markets with the greatest capacity under development include London, Northern Virginia, Silicon Valley, Atlanta, Chicago, Dublin, Hong Kong, Phoenix, Singapore and Jakarta.

The report also highlighted the 3 main types of challenges and responsibilities that data centre operators face. These include the ability to source for renewable energy, the ability to develop better methods of cooling servers and the ability to design more efficient facilities to meet the sustainability goals of clients and governments.  
In Singapore, data centres accounted for 7 per cent of Singapore's total electricity consumption in 2020.

Earlier this year, the moratorium on new data centres in Singapore was lifted, with certain criteria on energy efficiency.

Minister for Trade and Industry, Gan Kim Yong had said that the government had "to find a way to manage the growth of data centres in a sustainable manner consistent with our climate change commitments".  
SGX lists several Reits with substantial data centre assets, including Mapletree Industrial Trust,  Ascendas Reit and 2 pure play data centre Reits - Keppel DC Reit and Digital Core Reit.   
Keppel DC Reit (KDCReit), Asia's first pure-play data centre Reit, has 21 properties located across 9 countries in Asia-Pacific and Europe.

The Reit also has the right of first refusal for S$2 billion of potential data centre assets for acquisitions through its sponsor, Keppel T&amp;T as well as Keppel's private data centre funds.

In its most recent FY21 results, KDCReit posted a record high portfolio occupancy of 98.3 per cent and announced distribution per unit (DPU) of 9.851 cents, representing a 7.4 per cent year-on-year growth.

The Reit has also committed to progressively reduce its combined Scope 1 and Scope 2 emissions with an aim to halve it by 2030 from a 2019 baseline.

It also aims to introduce renewable energy to at least 50 per cent of its colocation assets by 2030, as well as encourage the use of renewable energy at all other portfolio assets.

Digital Core Reit, which listed on the SGX in 2021, has a portfolio of 10 data centres across the United States and Canada.

The Reit's core strategy includes investing in high-quality assets with strategic locations generating long-term pricing power and well-maintained physical structure.

Digital Core Reit has projected a DPU of 4.18 US cents for FY2022 and guided for a 5.3 per cent DPU growth in FY2023.

The Reit has committed to delivering sustainable growth for all stakeholders and aims to reduce Scope 1 and 2 emissions by 68 per cent and Scope 3 emissions by 24 per cent by 2030.  REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - Data centre S-Reits committed to sustainable growth

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Lendlease Global Commercial REIT / Equity Capital Markets

<ul>
<li>Lendlease REIT is looking to raise up to US$427m via a private placement and a preferential offering.</li>
<li>The deal is very well flagged as the acquisition was announced in Feb 2022 and the EGM approval for the same was received earlier this month.</li>
<li>In this note, we will run the deal through our ECM framework and talk about the recent updates.</li>
</ul>


Lendlease REIT is looking to raise up to US$427m via a private placement and a preferential offering.
The deal is very well flagged as the acquisition was announced in Feb 2022 and the EGM approval for the same was received earlier this month.
In this note, we will run the deal through our ECM framework and talk about the recent updates.


Lendlease Global REIT Placement - Very Well Flagged but Still Quite a Large One to Digest

<ul>
<li>Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares.</li>
<li>The company will use the proceeds from the placement to pay down debt that it has accumulated from earlier acquisition/construction.</li>
<li>In this note, we will talk about the recent developments and run the deal through our ECM framework.</li>
</ul>


Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares.
The company will use the proceeds from the placement to pay down debt that it has accumulated from earlier acquisition/construction.
In this note, we will talk about the recent developments and run the deal through our ECM framework.


Abacus Property Group Placement - Previous Deal Did Well, This One Won’t Be Accretive

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<div class="content-caption">Insti investors continue to net buy sreits</div>

The iEdge S-Reit Index recovered 2.5 per cent in total returns over the past 5 sessions (Feb 25, 2022 through to Mar 3, 2022), after a 2 per cent decline seen last Thursday (Feb 24) as global markets saw major moves amid the market volatility.
Despite the dip, the iEdge S-Reit Index has returned 0.6 per cent in total returns for the whole period from Feb 24, 2022 through to Mar 3, 2022.
This means it outperformed the FTSE EPRA Nareit Asia ex-Japan Index which declined 0.7 per cent during the same period. Within the S-Reit sub-sectors, gainers were led by the specialised, healthcare and office Reits while decliners were led by hospitality, retail and diversified Reits.
During the period, institutional investors have been a key driver in S-Reits' fund flow activities, accumulating net institutional inflows of S$30.4 million.
Retail investors on the other hand, net sold S$42.6 million for the sector. In terms of sub-sectors, institutional flows were driven by inflows seen in diversified S-Reits (+S$16.7 million), specialised/data centre S-Reits (+S$6.9 million), and office S-Reits (+S$6.7 million).
The largest retail outflows were seen in diversified S-Reits (-S$22.8 million), office S-Reits (-S$6.6 million), and industrial S-Reits (-S$5.5 million).
On a year-to-date basis, S-Reits have seen a 2 per cent decline, against the Straits Times Index's 4.4 per cent total returns, while the FTSE EPRA Nareit Asia ex-Japan Index has seen a decline of 2.3 per cent.
Interest rates continue to be a key focus for the sector, as expectations of a rate hike grow.
As the earnings season concludes for the sector, broad based distribution per unit growth and healthy occupancy rates remain a common theme. REIT Watch is a weekly column on The Business Times,<a href="https://www.businesstimes.com.sg/companies-markets/green-shoots-for-retail-and-hospitality-s-reits-amid-new-pandemic-phase" target="_blank" rel="noopener">&nbsp;</a><a href="https://www.businesstimes.com.sg/companies-markets/institutional-investors-continue-to-net-buy-s-reits" target="_blank" rel="noopener">read&nbsp;</a>the original version.


Insti investors continue to net buy sreits

The iEdge S-Reit Index recovered 2.5 per cent in total returns over the past 5 sessions (Feb 25, 2022 through to Mar 3, 2022), after a 2 per cent decline seen last Thursday (Feb 24) as global markets saw major moves amid the market volatility.
Despite the dip, the iEdge S-Reit Index has returned 0.6 per cent in total returns for the whole period from Feb 24, 2022 through to Mar 3, 2022.
This means it outperformed the FTSE EPRA Nareit Asia ex-Japan Index which declined 0.7 per cent during the same period.  Within the S-Reit sub-sectors, gainers were led by the specialised, healthcare and office Reits while decliners were led by hospitality, retail and diversified Reits.
During the period, institutional investors have been a key driver in S-Reits' fund flow activities, accumulating net institutional inflows of S$30.4 million.
Retail investors on the other hand, net sold S$42.6 million for the sector.  In terms of sub-sectors, institutional flows were driven by inflows seen in diversified S-Reits (+S$16.7 million), specialised/data centre S-Reits (+S$6.9 million), and office S-Reits (+S$6.7 million).
The largest retail outflows were seen in diversified S-Reits (-S$22.8 million), office S-Reits (-S$6.6 million), and industrial S-Reits (-S$5.5 million).
On a year-to-date basis, S-Reits have seen a 2 per cent decline, against the Straits Times Index's 4.4 per cent total returns, while the FTSE EPRA Nareit Asia ex-Japan Index has seen a decline of 2.3 per cent.
Interest rates continue to be a key focus for the sector, as expectations of a rate hike grow.
As the earnings season concludes for the sector, broad based distribution per unit growth and healthy occupancy rates remain a common theme.  REIT Watch is a weekly column on The Business Times,&nbsp;read&nbsp;the original version.

REIT Watch - Institutional Investors Continue to Net Buy S-Reits

Singapore

Mapletree Industrial Trust is a Singapore-focused real estate investment trust with a large and diversified portfolio of industrial properties. The Trust invests in a diverse portfolio of industrial properties with the primary objective of achieving an attractive level of return from rental income and for long-term capital growth.

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Mapletree Industrial Trust (MINT SP)

REIT Watch - Upcoming S-Reits' earnings releases schedule

SPH Reit kicked off the current financial reporting season for S-Reits on Apr 1, 2022 with the release of its H1 FY2022 (ended...

Singapore Exchange Ltd (SGX)

REIT Watch - Data centre S-Reits committed to sustainable growth

The data centre industry has experienced tremendous growth in the past 2 years, as businesses are faced with a sudden and...

Singapore Exchange Ltd (SGX)

Lendlease Global REIT Placement - Very Well Flagged but Still Quite a Large One to Digest

Lendlease REIT is looking to raise up to US$427m via a private placement and a preferential offering. The deal is very well flagged.

Sumeet Singh

Abacus Property Group Placement - Previous Deal Did Well, This One Won’t Be Accretive

Abacus aims to raise around US$146m (A$200m) via issuing new shares worth 7.1% of issued shares. In this note, we will run the deal through our ECM...

Sumeet Singh

REIT Watch - Institutional Investors Continue to Net Buy S-Reits

The iEdge S-Reit Index recovered 2.5 per cent in total returns over the past 5 sessions (Feb 25, 2022 through to Mar 3, 2022), after a 2 per...

Singapore Exchange Ltd (SGX)

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)