Frasers Centrepoint Trust - RHB Invest 2024-04-25: On The Right Track

• Frasers Centrepoint Trust’s 1HFY24 DPU was slightly below our forecasts. We still recommend the add-on-dips strategy.
• Operationally, Frasers Centrepoint Trust continues to show robustness with very high occupancy and high single-digit rent reversions (similar to peers), which are expected to continue.
• - Read this at SGinvestors.io -

Healthy uptick in 1HFY24 rent reversions

• Healthy uptick in Frasers Centrepoint Trust's 1HFY24 rent reversions at +7.5% (1HFY23: +4.3%) driven by its dominant malls and well-supported by higher tenant sales (2QFY24: +4.3% y-o-y), that are 20% above pre-pandemic levels (for Mar 2024).
• - Read this at SGinvestors.io -
• The S$38m asset enhancement initiative (AEI) at Tampines 1 is on track to be completed by Sep 2024. The additional AEI space has received >99% pre-leasing commitment to date, with an expected ROI of ~8%.

NEX acquisition contributions to fully kick in from 3QFY24.

• Frasers Centrepoint Trust completed the acquisition of an additional 24.5% stake in the mall at end-March. The acquisition is mildly accretive, but has room for growth from reconfiguration of tenant space and asset enhancements which are currently being executed, as well as further upside if tax transparency status is achieved on the mall income.
• Overall gearing edged up this quarter from a drawdown of debt to fund the acquisition, but remains comfortable at 38.5%.

Possible divestment of Central Plaza

• Read more at SGinvestors.io.

Vijay Natarajan RHB Securities Research | https://www.rhbgroup.com/ 2024-04-25 SGinvestors.io

---