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

SCCM Asia Research

Research from SooChow CSSD Capital Markets (Asia)

Headquartered in Singapore, SooChow CSSD Capital Markets (Asia) is an investment bank focusing on emerging growth companies across Asia, providing a full suite of investment banking services, including corporate finance, mergers and acquisitions advisory, equity capital markets, institutional equities sales and trading and equities research.

SooChow CSSD Capital Markets (Asia)

Thematic (Sector/Industry)

<ul><li><a href="https://www.smartkarma.com/entities/capitaland-integrated-commercial-trust" target="_blank" data-smartkarma-citation="entities:105" rel="noopener">Capitaland Integrated Commercial Trust (CICT SP)</a> 2H21 DPU -8.9% YoY; Office cap rates compressed while retail rental reversions improving   </li><li><a href="https://www.smartkarma.com/entities/mapletree-north-asia-commercial-trust" target="_blank" data-smartkarma-citation="entities:5127" rel="noopener">Mapletree North Asia Commercial Trust (MAGIC SP)</a> 3Q22 Business Updates – High occupancies a priority against falling reversions</li><li><a href="https://www.smartkarma.com/entities/ascott-residence-trust" target="_blank" data-smartkarma-citation="entities:6560" rel="noopener">Ascott Residence Trust (ART SP)</a> 2H21 DPU +14% YoY; RevPAU rebounded strongly with plenty of growth initiatives in the pipelines</li></ul>

Capitaland Integrated Commercial Trust (CICT SP) 2H21 DPU -8.9% YoY; Office cap rates compressed while retail rental reversions improving   Mapletree North Asia Commercial Trust (MAGIC SP) 3Q22 Business Updates – High occupancies a priority against falling reversionsAscott Residence Trust (ART SP) 2H21 DPU +14% YoY; RevPAU rebounded strongly with plenty of growth initiatives in the pipelines

ASEAN Builder's Scoop (28Jan22) - CICT Office Cap Rates Compressed

<ul><li><a href="https://www.smartkarma.com/entities/keppel-dc-reit" target="_blank" data-smartkarma-citation="entities:85" rel="noopener">Keppel DC REIT (KDCREIT SP)</a> 2H21 DPU +2.8% YoY; Rising portfolio valuations as Cap rates tighten in APAC</li><li><a href="https://www.smartkarma.com/entities/parkway-life-reit" target="_blank" data-smartkarma-citation="entities:13422" rel="noopener">Parkway Life REIT (PREIT SP)</a> Parkway Life REIT (PREIT SP) 4Q21 DPU came in flat; Consistently expensive but delivering stable results</li><li><a href="https://www.smartkarma.com/entities/capitaland-integrated-commercial-trust" target="_blank" data-smartkarma-citation="entities:105" rel="noopener">Capitaland Integrated Commercial Trust (CICT SP)</a> CapitaLand Integrated Commercial Trust (CICT SP) to sell JCube at &lt;4% yield; Received a 10yrs ROFR on the potential redevelopment of the site  </li></ul>

Keppel DC REIT (KDCREIT SP) 2H21 DPU +2.8% YoY; Rising portfolio valuations as Cap rates tighten in APACParkway Life REIT (PREIT SP) Parkway Life REIT (PREIT SP) 4Q21 DPU came in flat; Consistently expensive but delivering stable resultsCapitaland Integrated Commercial Trust (CICT SP) CapitaLand Integrated Commercial Trust (CICT SP) to sell JCube at &lt;4% yield; Received a 10yrs ROFR on the potential redevelopment of the site  

ASEAN Builder's Scoop (25Jan22) - KDCREIT Rising Portfolio Valuations

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

Wanda Commercial Management Group / Equity Capital Markets

<ul>
<li>Wanda Commercial Management Group (WCMG) is looking to raise up to US$4bn in its upcoming Hong Kong IPO.</li>
<li>WCMG is a commercial operation service provider. As of Oct 2021, the firm managed 398 malls with total gross floor area (GFA) under management of 56.5m sqm.</li>
<li>In this note, we will talk about the positive aspects of the deal.</li>
</ul>


Wanda Commercial Management Group (WCMG) is looking to raise up to US$4bn in its upcoming Hong Kong IPO.
WCMG is a commercial operation service provider. As of Oct 2021, the firm managed 398 malls with total gross floor area (GFA) under management of 56.5m sqm.
In this note, we will talk about the positive aspects of the deal.


Wanda Commercial Management Group Pre-IPO - The Positives - Aiming for One of HK's Largest 2022 IPOs

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

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 <img src='https://api2.sgx.com/sites/default/files/2022-01/Capture_8.PNG' alt='Timeline of SREIT proposed and completed M&As since 2018' />
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 <div class='content-caption'>Timeline of SREIT proposed and completed M&As since 2018</div>
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For S-Reits, listing on the exchange is the beginning of a journey. Twenty-four S-Reits had announced asset acquisitions valued at over S$15.3 billion and exceeding S$12.7 billion in total purchase consideration in 2021.

Aside from asset acquisitions, S-Reits have also been active in terms of mergers and acquisition (M&amp;A) opportunities. They have seen at least 5 consolidations since 2018 and could be seeing 2 more this year.

The 5 consolidated S-Reits since 2018 are CapitaLand Integrated Commercial Trust (by CapitaLand Mall Trust and CapitaLand Commercial Trust), Frasers Logistics &amp; Commercial Trust (by Frasers Commercial Trust and Frasers Logistics &amp; Industrial Trust), Ascott Residence Trust (by Ascott Residence Trust and Ascendas Hospitality Trust), OUE Commercial REIT (OUE Commercial REIT and OUE Hospitality Trust), and ESR-REIT (by ESR-REIT and Viva Industrial Trust). 
Most recently announced on Dec 31, 2021 is the proposed merger between Mapletree Commercial Trust (MCT) and Mapletree North Asia Commercial Trust (MNACT) to form Mapletree Pan Asia Commercial Trust (MPACT). 
The proposed merger is expected to propel the combined entity to be the seventh largest REIT listed in Asia with a market capitalisation of approximately S$10.5 billion. 
The combined portfolio will consist of 18 commercial assets diversified across Singapore, China, Hong Kong, Japan and South Korea with assets under management (AUM) of approximately S$17.1 billion (per MCT’s AUM as of 30 September 2021 and MNACT’s AUM as of 31 October 2021). 
The proposed merger is expected to be effected by a trust scheme of arrangement with MCT acquiring all MNACT Units in exchange for new units in MCT or a combination of cash and MCT Units.

Reit managers of MCT and MNACT view the merger as an opportunity to bring together 2 leading commercial Reits with highly complementary qualities and see the combined portfolio in providing higher financial flexibility and debt headroom to accelerate its growth and acquisitions.

The new entity is also expected to benefit from the increased representation in key indices and potentially attract a wider investor base and improved trading liquidity.

Another proposed merger in progress is by ESR-Reit and Ara Logos Logistics Trust (ALOG) to form ESR-LOGOS REIT (E-LOG), with a core focus on new economy real estate. 
The combined entity, E-LOG, will hold a diversified portfolio of 87 properties consisting of logistics/warehouse, high-specifications industrial properties, business parks and general industrial properties with total assets of approximately S$5.4 billion across Singapore and Australia (as of 30 June 2021). 
Similarly, via a trust scheme, the proposed merger will see ESR-Reit acquire all units in ALOG in exchange for a combination of cash and new units in ESR-Reit.

Reit managers of ESR-Reit and ALOG have noted that the proposed merger will enhance E-LOG's growth trajectory backed by its sponsor, ESR Group, by providing access to the sponsor's new economy pipeline properties in Asia-Pacific worth over US$50 billion.  REIT Watch is a weekly column on The Business Times, <a href="https://www.businesstimes.com.sg/real-estate/s-reits-bigger-and-bolder-over-the-years">read </a>the original version.
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    Timeline of SREIT proposed and completed M&As since 2018


For S-Reits, listing on the exchange is the beginning of a journey. Twenty-four S-Reits had announced asset acquisitions valued at over S$15.3 billion and exceeding S$12.7 billion in total purchase consideration in 2021.

Aside from asset acquisitions, S-Reits have also been active in terms of mergers and acquisition (M&amp;A) opportunities. They have seen at least 5 consolidations since 2018 and could be seeing 2 more this year.

The 5 consolidated S-Reits since 2018 are CapitaLand Integrated Commercial Trust (by CapitaLand Mall Trust and CapitaLand Commercial Trust), Frasers Logistics &amp; Commercial Trust (by Frasers Commercial Trust and Frasers Logistics &amp; Industrial Trust), Ascott Residence Trust (by Ascott Residence Trust and Ascendas Hospitality Trust), OUE Commercial REIT (OUE Commercial REIT and OUE Hospitality Trust), and ESR-REIT (by ESR-REIT and Viva Industrial Trust).  
Most recently announced on Dec 31, 2021 is the proposed merger between Mapletree Commercial Trust (MCT) and Mapletree North Asia Commercial Trust (MNACT) to form Mapletree Pan Asia Commercial Trust (MPACT).  
The proposed merger is expected to propel the combined entity to be the seventh largest REIT listed in Asia with a market capitalisation of approximately S$10.5 billion.  
The combined portfolio will consist of 18 commercial assets diversified across Singapore, China, Hong Kong, Japan and South Korea with assets under management (AUM) of approximately S$17.1 billion (per MCT’s AUM as of 30 September 2021 and MNACT’s AUM as of 31 October 2021).  
The proposed merger is expected to be effected by a trust scheme of arrangement with MCT acquiring all MNACT Units in exchange for new units in MCT or a combination of cash and MCT Units.

Reit managers of MCT and MNACT view the merger as an opportunity to bring together 2 leading commercial Reits with highly complementary qualities and see the combined portfolio in providing higher financial flexibility and debt headroom to accelerate its growth and acquisitions.

The new entity is also expected to benefit from the increased representation in key indices and potentially attract a wider investor base and improved trading liquidity.

Another proposed merger in progress is by ESR-Reit and Ara Logos Logistics Trust (ALOG) to form ESR-LOGOS REIT (E-LOG), with a core focus on new economy real estate.  
The combined entity, E-LOG, will hold a diversified portfolio of 87 properties consisting of logistics/warehouse, high-specifications industrial properties, business parks and general industrial properties with total assets of approximately S$5.4 billion across Singapore and Australia (as of 30 June 2021).  
Similarly, via a trust scheme, the proposed merger will see ESR-Reit acquire all units in ALOG in exchange for a combination of cash and new units in ESR-Reit.

Reit managers of ESR-Reit and ALOG have noted that the proposed merger will enhance E-LOG's growth trajectory backed by its sponsor, ESR Group, by providing access to the sponsor's new economy pipeline properties in Asia-Pacific worth over US$50 billion.   REIT Watch is a weekly column on The Business Times, read the original version.



REIT Watch - S-Reits: Bigger and bolder over the years

<ul>
<li>Vertex Technology Acquisition Corporation Ltd (VTAC) aims to raise around US$126m via Singapore’s first SPAC listing.</li>
<li>VTAC is sponsored by Vertex Venture Holdings (VVH), a wholly owned subsidiary of Temasek. </li>
<li>In this tear sheet, we will talk about the deal background and structure.</li>
</ul>


Vertex Technology Acquisition Corporation Ltd (VTAC) aims to raise around US$126m via Singapore’s first SPAC listing.
VTAC is sponsored by Vertex Venture Holdings (VVH), a wholly owned subsidiary of Temasek. 
In this tear sheet, we will talk about the deal background and structure.


Vertex Technology Acquisition Corporation Ltd Tear Sheet - Singapore’s First SPAC Listing

Singapore

Capitaland Integrated Commercial Trust operates as a retail estate investment trust. The Compnay invests in retail and office properties and integrated developments. Capitaland Integrated Commercial Trust serves clients in Asia Pacific.

Capitaland Integrated Commercial Trust (CICT SP)

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Capitaland Integrated Commercial Trust (CICT SP)

ASEAN Builder's Scoop (28Jan22) - CICT Office Cap Rates Compressed

MAGIC high occupancy a priority; ART RevPAU rebounded strongly; CDREIT underlying operations recovering; FHT QoQ ongoing recovery; MREIT to acquire...

SCCM Asia Research

ASEAN Builder's Scoop (25Jan22) - KDCREIT Rising Portfolio Valuations

PREIT consistently pricey as results stable; CICT sells JCube at <4% yield; FLT divests CSE at ~2.5% yield; YLLG sells out Shanghai project; SPALI...

SCCM Asia Research

Wanda Commercial Management Group Pre-IPO - The Positives - Aiming for One of HK's Largest 2022 IPOs

Wanda Commercial Management Group (WCMG) is looking to raise up to US$4bn in its upcoming Hong Kong IPO. In this note, we talk about the positive...

Sumeet Singh

REIT Watch - S-Reits: Bigger and bolder over the years

For S-Reits, listing on the exchange is the beginning of a journey. Twenty-four S-Reits had announced asset acquisitions valued...

Singapore Exchange Ltd (SGX)

Vertex Technology Acquisition Corporation Ltd Tear Sheet - Singapore’s First SPAC Listing

Vertex Technology Acquisition Corporation Ltd (VTAC) aims to raise around US$126m via Singapore’s first SPAC listing. VTAC is backed by Vertex,...

Sumeet Singh

Price Gauge

52-week Range

Market Cap (USDm)

P/E

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