Thursday, February 27, 2014

Ascott Residence Trust: Delivering the first shot in Dalian (DBSV)

Ascott Residence Trust:
STI : 3,086.64
BUY S$1.18
Price Target : 12-Month S$ 1.33
Delivering the first shot in Dalian

•First acquisition in Dalian, China for Rmb 571m
•Accretive to earnings; more to come
•Maintain BUY and S$1.33 TP

Delivering its first acquisition in Dalian; implied yield of 5.5% is accretive.  Ascott REIT announced the proposed acquisition of a 125-unit serviced residence in Dalian for Rmb 571m (cS$118.6m) from a third party. The property is located in the heart of Jinzhou New District, which has seen robust foreign direct investments in recent years and is home to many established multinational corporations. The purchase price implies an EBITDA yield of 5.5%, which is higher than its current portfolio yield of 5.4% for its serviced residences in China.  The acquisition will be funded with proceeds from the recent rights issue and is estimated to results in a 1.5% uplift in DPUs. Gearing will inch up to c36%.

Strong property attributes; more acquisitions expected.   The Manager has once again demonstrated his ability to source for accretive deals and further entrench Ascott REIT’s presence in China.  The property is noted to be the only international serviced residence in the area with minimal competition. After completion (est. mid-2014), the property will be rebranded as Somerset Grand Central Dalian and managed by Ascott Group, and combined with its presence in Shenyang and Dalian, will provide scale and network to further drive the property’s performance. We believe this acquisition is the first of many and forms part of S$350m already assumed in our projections for FY14F. Our estimates are maintained.

Maintain BUY, TP S$1.33.   We believe yields of close to 7.3%-7.5% remain attractive. Re-rating catalysts to hinge on the Manager’s continued ability to source accretive acquisitions and potential acquisition of Sponsor’s property pipeline that will grow its portfolio meaningfully.

Source/Extract/Excerpts/来源/转贴/摘录: DBSV-Research,
Publish date: 21/02/14

No comments:

Post a Comment

Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)

乔治·索罗斯(George Soros)



高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo

There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
  • Selected Indexes 52 week range

  • Margin of Safety

    Investment Clock

    World's First Interactive Investment Clock