Mapletree Logistics Trust - UOB Kay Hian 2024-07-26: Growth Deceleration; Downgrade To HOLD

• Mapletree Logistics Trust plans to expand in growth markets, such as India, Malaysia and Vietnam, but the pace of acquisitions is curtailed by its elevated aggregate leverage of 39.6%. The outlook for China remains challenging and the weakness is expected to persist over the next few quarters. Downgrade to HOLD.

Hampered by strong S$.

• - Read this at SGinvestors.io -
• Gross revenue and NPI decreased by 0.3% and 0.9% y-o-y in 1QFY25 as contributions from overseas logistics properties were curtailed by a strong S$ (JPY: -10% y-o-y and KRW: -4% y-o-y).
• - Read this at SGinvestors.io -

Persistent weakness from China.

• Mapletree Logistics Trust achieved positive rental reversion of 2.6% in 1QFY25 (Singapore: 7.8%, Hong Kong: 2.1% and China: -11.3%). Excluding China, which accounted for half of lease expiry in 1QFY25, positive rental reversion would be 4.6%.
• Portfolio occupancy eased marginally by 0.3ppt q-o-q to 95.7% as of Jun 24. Occupancies for Australia, India, Japan and Vietnam were maintained at above 98%. Temporary vacancies in Singapore and Vietnam are expected to be backfilled in 2QFY25.

Resilient balance sheet.

• Read more at SGinvestors.io.

Jonathan KOH CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-07-26 SGinvestors.io

---