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S-REITs underperformed in 1H26 (S-REIT index: -6% vs STI: +11%). Key reason in our view: Uncertainty over interest rate outlook augmented by shift in fund flows towards Singapore banks and artificial intelligence (AI) beneficiaries.
- - Read this at SGinvestors.io -
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Key rerating catalysts: Positive earnings surprise, stabilising inflation, and interest rate outlook with retreating oil prices and rotating fund inflows into REITs. Stay NEUTRAL
Room for moderation in a hawkish rate outlook.
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The market, in our view, has not priced in this scenario, with a decline in S-REIT prices resulting in attractive 0.9x P/BV sector valuation, at -1 standard deviation levels of long-term average yields and offering an average yield of ~6% with a yield spread of ~380bps over the 10-year government bond yield – among the highest globally.
DPU growth outlook largely intact
- Read more at SGinvestors.io.
Above is an excerpt from a report by RHB Securities Research.
Clients of RHB may be the first to access the full PDF report @ https://www.rhbtradesmart.com/.
Vijay Natarajan NA RHB Securities Research | https://www.rhbgroup.com/ 2026-07-08
Read More Analysis On Singapore REITs (S-REITs):
Analyst Reports on Singapore REIT Sector
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S-REIT Share Price Performance
S-REIT Target Prices & Ratings
