Keppel DC REIT - DBS Research 2023-07-25: Where Will The Next Accretive Acquisition Come From?

• Keppel DC REIT (SGX:AJBU)'s 1H23 revenues and NPI increased 3.6% and 3.3%, respectively, mainly due to contributions from Guangdong DC 2 and 3 acquired on 12 August 2022, and organic growth from renewals and income escalations, and partially offset by lower contributions from Singapore colocation assets due to higher operating costs (higher electricity costs).
• - Read this at SGinvestors.io -
• All-in interest rates in 2Q23 increased by 50bps, mainly due to the refinancing of the ~S$74m EUR loan due this year.
• - Read this at SGinvestors.io -

1H23 DPU of 5.051 cents, in line with our projections

• Keppel DC REIT's 1H23 DPU of 5.051 cents remained fairly flat y-o-y and h-o-h, and makes up ~51% of our FY23 estimates. See Keppel DC REIT's dividend date.
• Rental growth and higher portfolio occupancy rates to drive sustained organic growth; offset higher financing costs. We believe that Keppel DC REIT will be able to maintain 2H23 DPU at these levels.

Financing costs increased 50bps in 2Q23

• Read more at SGinvestors.io.

Dale LAI DBS Group Research | Derek TAN DBS Research | https://www.dbs.com/insightsdirect/ 2023-07-25 SGinvestors.io

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