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><a href="https://www.smartkarma.com/entities/frasers-centrepoint-trust" target="_blank" data-smartkarma-citation="entities:2870" rel="noopener">Frasers Centrepoint Trust (FCT SP)</a> to sell YewTee Point for S$220m; 75% upside from original purchase price</h3><p>FCT will divest YewTee Point for S$220m, having entered into a sale-and-purchase agreement with an unrelated third party. The transaction is expected to be completed on 28May21. The sales proceed will be used to repay debts and lower gearing level. The Choa Chu Kang mall was valued at S$200m by Savills as at 31Jan21. On a pro-forma FY20 (Sep20) basis, the DPU dilution is 2.33% and NAV would rise by 0.8%. The divestment is in line with the manager’s proactive portfolio management strategy to optimise the trust's portfolio composition. Upon completion of the divestment, FCT's retail portfolio will comprise nine retail properties, all located in the suburbs of Singapore.</p><p>Comments: The S$220m offer price is ~16% higher than the latest book value (as at end FY20) and translates to S$2,986psf (based on NLA). It also represents a significant 75% upside from purchase price of S$125.7m in 2010.</p>

SingaporeFrasers Centrepoint Trust (FCT SP) to sell YewTee Point for S$220m; 75% upside from original purchase priceFCT will divest YewTee Point for S$220m, having entered into a sale-and-purchase agreement with an unrelated third party. The transaction is expected to be completed on 28May21. The sales proceed will be used to repay debts and lower gearing level. The Choa Chu Kang mall was valued at S$200m by Savills as at 31Jan21. On a pro-forma FY20 (Sep20) basis, the DPU dilution is 2.33% and NAV would rise by 0.8%. The divestment is in line with the manager’s proactive portfolio management strategy to optimise the trust's portfolio composition. Upon completion of the divestment, FCT's retail portfolio will comprise nine retail properties, all located in the suburbs of Singapore.Comments: The S$220m offer price is ~16% higher than the latest book value (as at end FY20) and translates to S$2,986psf (based on NLA). It also represents a significant 75% upside from purchase price of S$125.7m in 2010.

ASEAN Builder's Scoop - FCT to Sell YewTee Point; Activists at SSREIT Asked ESR to Buy Assets

Partner, River Valley Asset Management

River Valley Asset Management

Partner

Singapore-based boutique asset management firm

River Valley Asset Management is a Singapore-based boutique asset management firm. Our team at RVAM strongly believes in being a trusted steward of our clients' wealth across generations.

Each of our fund managers has years of rich portfolio management experience over multiple market cycles at world-class investment houses. We bring our clients the combined strength of our investment team to manage their financial portfolios and to provide bespoke guidance on all aspects of their financial health.

We offer multi-asset class expert investment advice to accredited investors who are family offices, high net worth individuals and institutional investors to preserve and grow our clients' wealth.

The fund management team of the company includes Homiyar Vasania, Anand Ramachandran and Jamshed Desai.

<p><span lang="EN-SG">As a mature economy with stable businesses, Singapore's equity benchmarks are dominated by Banks &amp; Government Linked Companies (GLC's) which have grown large over time. The large listed companies in Singapore (private as well as GLC’s) are now facing headwinds from tight labour markets resulting in rising costs and, in the absence of growth, the need to focus on raising productivity. <br></span><br><span lang="EN-SG"><span lang="EN-SG">It is therefore not surprising that the Singapore markets do not excite the average investor. However, within this space we have been finding many hidden gems which have consistently delivered and increasingly fit the needs of a Singaporean investor looking for stable returns in a low growth environment: the REIT marketplace. Over the last seven years the REIT index has delivered over 10% p.a. annualized return which stands in stark contrast to the meagre 4% returns from benchmark STI index.</span></span></p>

As a mature economy with stable businesses, Singapore's equity benchmarks are dominated by Banks &amp; Government Linked Companies (GLC's) which have grown large over time. The large listed companies in Singapore (private as well as GLC’s) are now facing headwinds from tight labour markets resulting in rising costs and, in the absence of growth, the need to focus on raising productivity.   It is therefore not surprising that the Singapore markets do not excite the average investor. However, within this space we have been finding many hidden gems which have consistently delivered and increasingly fit the needs of a Singaporean investor looking for stable returns in a low growth environment: the REIT marketplace. Over the last seven years the REIT index has delivered over 10% p.a. annualized return which stands in stark contrast to the meagre 4% returns from benchmark STI index.

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

<ul><li>IN THE third quarter of 2023, the Straits Times Index (STI) generated a 2.1 per cent total return, bringing its nine-month total return to 3.3 per cent.</li><li>During the quarter, the STI marginally outpaced the FTSE Asean Extended 60 Index and FTSE Asia Pacific Index, which recorded total returns of 1.1 per cent and declines of 1.1 per cent, respectively.</li><li>On the other side of the “higher-for-longer” Fed funds rate outlook, the iEdge S-Reit Index declined 4.2 per cent in total return in Q3 2023.</li></ul>

IN THE third quarter of 2023, the Straits Times Index (STI) generated a 2.1 per cent total return, bringing its nine-month total return to 3.3 per cent.During the quarter, the STI marginally outpaced the FTSE Asean Extended 60 Index and FTSE Asia Pacific Index, which recorded total returns of 1.1 per cent and declines of 1.1 per cent, respectively.On the other side of the “higher-for-longer” Fed funds rate outlook, the iEdge S-Reit Index declined 4.2 per cent in total return in Q3 2023.

REIT Watch - Three S-Reits buck the trend in September

Mapletree Industrial Trust / Equity Bottom-Up

<ul><li>While the iEdge S-Reit Index (benchmark for the S-Reits cluster) returned flat in the year to date, the top 10 performing S-Reits within the benchmark averaged 11.1 per cent total returns.</li><li>Of these, four were industrial Reits – AIMS Apac Reit (11.2 per cent in total returns), Mapletree Logistics Trust (9.3 per cent), Mapletree Industrial Trust (7.7 per cent), and CapitaLand Ascendas Reit (7.3 per cent).</li><li>The four industrial Reits averaged 9 per cent in total returns in the year to date and recorded combined net institutional fund inflows of S$18.9 million.</li></ul>

While the iEdge S-Reit Index (benchmark for the S-Reits cluster) returned flat in the year to date, the top 10 performing S-Reits within the benchmark averaged 11.1 per cent total returns.Of these, four were industrial Reits – AIMS Apac Reit (11.2 per cent in total returns), Mapletree Logistics Trust (9.3 per cent), Mapletree Industrial Trust (7.7 per cent), and CapitaLand Ascendas Reit (7.3 per cent).The four industrial Reits averaged 9 per cent in total returns in the year to date and recorded combined net institutional fund inflows of S$18.9 million.

REIT Watch - Four industrial S-Reits among best performing in the year to date

<ul><li>Schedule of S-REITs & Property Trusts’ Earnings or Business Updates Mapletree Logistics Trust 25-Jul 26-Jul  This coming week, another 17 S-Reits and property trusts will be releasing their earnings or business updates for the period ended Jun 30, 2023.</li></ul>

Schedule of S-REITs & Property Trusts’ Earnings or Business Updates Mapletree Logistics Trust 25-Jul 26-Jul  This coming week, another 17 S-Reits and property trusts will be releasing their earnings or business updates for the period ended Jun 30, 2023.

REIT Watch - 17 S-Reits reporting earnings during the week

Singapore

Alpha Integrated Real Estate Investment Trust is a Singapore-listed real estate investment trust focused on high-quality industrial assets, including high-tech industrial, chemical warehouse & logistics, warehouse & logistics, and general industrial properties. It holds a diversified portfolio of 18 properties in Singapore. The company was founded in 2010 and is headquartered in Singapore.

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Alpha Integrated (SSREIT SP)

ASEAN Builder's Scoop - FCT to Sell YewTee Point; Activists at SSREIT Asked ESR to Buy Assets

Activists at SSREIT asked ESR to buy its assets; GLL to be acquired and delisted; Sheng Tai-IWG expands workspace in Melaka

SCCM Asia Research

Singapore - The Hidden Gems

As a mature economy with stable businesses, Singapore's equity benchmarks are dominated by Banks & Government Linked Companies (GLC's) which...

River Valley Asset Management

REIT Watch - Three S-Reits buck the trend in September

IN THE third quarter of 2023, the Straits Times Index (STI) generated a 2.1 per cent total return, bringing its nine-month total return to 3.3 per...

Singapore Exchange Ltd (SGX)

REIT Watch - Four industrial S-Reits among best performing in the year to date

While the iEdge S-Reit Index (benchmark for the S-Reits cluster) returned flat in the year to date, the top 10 performing S-Reits within the...

Singapore Exchange Ltd (SGX)

REIT Watch - 17 S-Reits reporting earnings during the week

Schedule of S-REITs & Property Trusts’ Earnings or Business Updates Mapletree Logistics Trust 25-Jul 26-Jul This coming week, another 17...

Singapore Exchange Ltd (SGX)

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