Mapletree Pan Asia Commercial Trust - Maybank Research 2023-10-30: Weak Performance; Downgrade To HOLD

• Mapletree Pan Asia Commercial Trust (SGX:N2IU) reported 2QFY24 DPU of S$0.0224, +2.8% q-o-q, -8.2% y-o-y. 1HFY24 DPU of S$0.0442 fell 10.2% y-o-y and was 47.5% of our FY24 estimate.

Headwinds from overseas assets & debt cost

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• We factor in higher operating and funding costs and lower DPU forecast for Mapletree Pan Asia Commercial Trust by ~10% and cut our DDM-based target price for Mapletree Pan Asia Commercial Trust by 26% to S$1.25.
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Steady performance of local assets

• Mapletree Pan Asia Commercial Trust's 2QFY24 gross revenue of S$240.2m was up 1.3% q-o-q, 10.1% y-o-y. NPI of S$183.2m was +2.2% q-o-q, +8.7% y-o-y. Excluding contribution of overseas properties (acquired in 2Q last year), gross revenue and NPI rose 5.3% y-o-y and 4.5% y-o-y respectively.
• Contribution from China and Japan declined q-o-q and y-o-y due to negative reversions and adverse FX impact.
• Festival Walk revenue and NPI for 2QFY24 grew 3.4% and 2.1%, respectively, due to higher ancillary income.
• Higher borrowing cost through the year and increased number of units lowered 2QFY24 DPU y-o-y.

Debt and FX headwinds

• Read more at SGinvestors.io.

Krishna Guha Maybank Research | https://www.maybank-ke.com.sg/ 2023-10-30 SGinvestors.io

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