- In China, growth from e-commerce has slowed. The huge logistics supply of 12m sqm in 2023 has pushed the nationwide vacancy rate to a high of 23%. We are concerned that the weakness from China could persist and last longer than the 6-12 months guided by management of Mapletree Logistics Trust (SGX:M44U).
- - Read this at SGinvestors.io -
- Mapletree Logistics Trust provides FY25 distribution yield of 5.6% (vs Frasers Logistics & Commercial Trust: 7.0%).
China’s logistics market in dire straits.
- Consumer spending in China is weighted down by negative wealth effect caused by falling prices in the residential property and stock markets. China’s online retail sales of goods & services slowed to 11.9% y-o-y in Dec 23 due to weakness in consumer confidence.
- - Read this at SGinvestors.io -
Risk from prolonged downturn in China.
- Mapletree Logistics Trust (SGX:M44U)’s management cautioned that demand is expected to be soft over the next 6-12 months. Tier 1 cities saw positive rental reversion of 2% but Tier 2 cities suffered negative reversion of 17% in 3QFY24. Management expects continued negative rental reversion at high single digits to low teens.
- Occupancy for China was stable at 93.1% in 3QFY24. Occupancy for Tier 1 cities has deteriorated by 4ppt q-o-q to 91%, while occupancy for Tier 2 cities was stable at 93%.
Prudent capital management.
- Read more at SGinvestors.io.
Above is the excerpt from report by UOB Kay Hian Research.
Clients of UOB Kay Hian may be the first to access the full report in PDF @ https://www.utrade.com.sg/.
Jonathan KOH CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-03-15
Read also UOB's most recent report:
2025-01-03 Mapletree Logistics Trust - Weighted Down By Exposure To Greater China.
Previous report by UOB:
2024-10-24 Mapletree Logistics Trust 2QFY25 - Negative Double-digit Rental Reversion In China.
Price targets by other brokers at Mapletree Logistics Trust Target Prices.
Listing of research reports at Mapletree Logistics Trust Analyst Reports.
Relevant links:
Mapletree Logistics Trust Share Price History,
Mapletree Logistics Trust Announcements,
Mapletree Logistics Trust Dividends & Corporate Actions,
Mapletree Logistics Trust News Articles