Sasseur REIT - Phillip Securities 2023-10-03: Growth Drivers Intact

• We maintain our BUY recommendation on Sasseur REIT (SGX:CRPU) with unchanged DDM-based target price of S$0.90 and FY23-24e dividend yield of 9.6% - 9.9%.
• We visited Sasseur REIT's outlet malls in Chongqing Liangjiang, Chongqing Bishan and Xi’an (ROFR asset) during Sasseur Group’s Anniversary Sales. Outlet sales at the Sponsor Group level increase 39% year-to-date as of Sept 22, 2023. Sales for the past 9 months have outperformed the entire year of FY22 due to the pent up demand and clear value proposition for its products.
• - Read this at SGinvestors.io -
• - Read this at SGinvestors.io -

Highlights of site visit to Sasseur's outlet malls

Outlet sales at the Sponsor Group level robust.

• Sales for the past nine months have outperformed the entire year of FY23, with the Chongqing Liangjiang outlet mall being the top contributor, and domestic brands accounting for ~70% of sales. Nike, Adidas, and +39 Space are usually the top three best-performing tenants for Chongqing Liangjiang and Xi’an outlet. New brands, including Teenie Weenie (for teenagers), Le Coq Sportif (sports), and AIMER (lingerie), have also gained popularity among middle-income Chinese customers.
• We anticipate a 29% y-o-y increase in FY23 sales, driven by Sasseur REIT's clear value proposition, which capitalises on the trend of consumption downgrade in China.

VIP membership at the Sponsor Group level is expected to increase by 20% to 20 million

• Read more at SGinvestors.io.

Liu Miao Miao Phillip Securities Research | https://www.stocksbnb.com/ 2023-10-03 SGinvestors.io

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