Singapore REITs - OCBC Investment 2024-02-26: Pullback Presents Buying Opportunities For Quality Names

Singapore REITs - Pullback Presents Buying Opportunities For Quality Names

Singapore REITs - OCBC Investment Research | SGinvestors.ioCapitaLand Ascendas REIT (SGX:A17U) MAPLETREE INDUSTRIAL TRUST (SGX:ME8U) MAPLETREE LOGISTICS TRUST (SGX:M44U)
  • Following an outperformance against the broader Singapore market in 2023, the S-REITs sector has lagged year-to-date in terms of share price movement. We believe this can be attributed largely to a rebound in the 10-year US Treasury (UST) yield and the 10-year Singapore government bond yield, which in turn was driven by a push back in Fed rate cut expectations.

Yields at play again as S-REITs pullback on delayed rate cut expectations

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4Q23/FY23 results review: DPU still largely declining on a y-o-y basis

  • During the recently concluded 4Q23/FY23 earnings season, most S-REITs under our coverage which disclosed distribution per unit (DPU) data continued to record declines on a y-o-y basis. This was once again attributed to higher borrowing costs, an enlarged unit base and FX translation losses.
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  • Overall average and median DPU growth came in at -3.5% and -2.2% y-o-y respectively, for the reporting period. However, the weaker performance was largely expected, as nine out of the 13 S-REITs’ results were considered to be in-line with our expectations. 3 S-REITs missed our expectations and only one exceeded.
  • We have since adjusted our DPU forecasts by -3.2% for the current financial year (FY1) and - 2.7% for the next financial year (FY2) on average, and by -2.8% for FY1 and -1.9% for FY2 on a median basis.

Softness in DPU to continue in near-term with growth to resume in next financial year

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Above is the excerpt from report by OCBC Investment Research.
Clients of OCBC Securities may be the first to access the full report in PDF @

OCBC Research Team OCBC Investment Research | 2024-02-26

Read More Analysis On Singapore REITs (S-REITs):
Analyst Reports on Singapore REIT Sector

Check Out Also The Summary Of:
S-REIT Share Price Performance
S-REIT Target Prices & Ratings


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