Keppel DC REIT - DBS Research 2025-01-27: Transformational Acquisition Driving Robust Earnings Growth

• Maintain BUY recommendation on Keppel DC REIT with higher target price of S$2.50 reflecting stronger growth expectations.

FY24 revenues & NPI were driven by strong organic growth & acquisitions.

• - Read this at SGinvestors.io -
• Additionally, Keppel DC REIT received a settlement sum of ~S$11mil from the DXC dispute, which also bolstered revenues for the year.

FY24 DPU of 9.451 cents was ~0.7% higher y-o-y, beating our estimates.

• - Read this at SGinvestors.io -
• Keppel DC REIT sustained momentum through FY24, reporting consecutive quarters of exceptional rental reversions of over +40% in both 2Q24 and 3Q24, followed by solid performance in 4Q24, with more than +30% rental reversion.
• Portfolio occupancy remained healthy at 97.2% in 4Q24, with only a slight decline due to lower occupancies at KDC SGP 1 and Gore Hill in Sydney.

Gearing remains at a healthy 31.5%; financing costs have started to decline.

• Read more at SGinvestors.io.

Dale LAI DBS Group Research | Derek TAN DBS Group Research | https://www.dbs.com/insightsdirect/ 2025-01-27 SGinvestors.io

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