MapletreeInd Updated Target Price following Q1 2011 result release

MapletreeInd Updated Target Price following Q1 2011 result release:

Brokerage	Recommendation	Target Price (S$)	Date
DBS Vickers	BUY	1.21	27/04/11
CIMB	OUTPERFORM	1.27	27/04/11

Latest updates at Stock Target Price.

Related Posts

• MapletreeInd Q1 2011 Quarterly Earnings Report

MapletreeInd Q1 2011 Quarterly Earnings Report

MapletreeInd Q1 2011 Quarterly Earnings Report:

• Press Release 
• Financial Statements
• Presentation Slides

Key Points

• Distribution per Unit (“DPU”) of 1.93 cents, higher than IPO Forecast (“Forecast”) by 9.7% for the Fourth Quarter Financial Year 2010 from 1 January 2011 to 31 March 2011 (“4Q FY2010”).
• DPU for the period from Listing Date of 21 October 2010 to 31 March 2011 exceeds Forecast by 11.3%.
• Net Asset Value (“NAV”) per unit improved to S$0.95 from S$0.86.
• Higher average occupancy rate of 93.2% and higher average passing rental rate of S$1.49 per square foot per month for 4Q FY2010.
• Strong upward rental reversions
• NAV Per Unit of S$0.85 as at 31 March 2011.
• Aggregate Leverage Ratio of 36.1% as at 31 March 2011.
• Unitholders can expect to receive their quarterly DPU for the period 1 January to 31 March 2011 on 31 May 2011. The closure of MIT’s transfer books and register of unitholders is 5.00pm on Thursday, 5 May 2011.

Author's Note
The DPU of 1.93 cents will be paid on 31 May 2011. Book closure is on 5 May 2011.

The DPU was 1.52 cents from the period from Listing Date of 21 October 2010 to 31 December 2010. This is the first quarter that a full quarter of DPU will be distributed since the Listing Date.

Related Posts

• Results Release 
• DPU History 
• MapletreeInd Q4 2010 Quarterly Earnings Report

CMT, Ascott Reit, MIT - Date of Result Release for Q1 2011

Updated date of Result Release for Q1 2011:

CapitaMall Trust APR 20

Ascott Reit APR 20
MapletreeInd APR 26

Latest Update at Results Release.

MapletreeInd Q4 2010 Quarterly Earnings Report

MapletreeInd Q4 2010 Quarterly Earnings Report:

• Press Release
• Financial Statements
• Presentation Slides

Key Points

• DPU of 1.52 cents higher than forecast by 13.4% for the period from Listing Date of 21 October 2010 to 31 December 2010.
• Healthy average occupancy rate of 92.3% and average passing rental rate of $1.45 per square feet per month for Third Quarter Financial Year 2010.
• Unitholders can expect to receive their quarterly DPU for the period 21 October to 31 December 2010 on Monday, 28 February 2011. 
• The closure of MIT’s transfer books and register of unitholders is 5.00pm on Tuesday, 1 February 2011
• NAV per unit of $0.87 as at 31 December 2010.

Author's Note
The DPU of 1.52 cents from the period from Listing Date of 21 October 2010 to 31 December 2010 will be paid on 28 February 2011. Books closure is on 1 Feb 2011.

This is the first distribution by Mapletree Industrial Trust since its listing on 21 Oct 2010.

Related Posts

• Results Release 
• DPU Information Page 
• IPO of Mapletree Industrial Trust
• MIT assigned a final rating of BBB+ by Fitch - 21 OCT 2010 
• Mapletree Industrial Trust Final Ballotting Announcement - 20 OCT 2010

MapletreeInd, First Reit, LMIR - Updated Target Price following Q4 2010 result release

MapletreeInd, First Reit, LMIR - Updated Target Price following Q4 2010 result release:

REIT	Brokerage	Recommendation	Target Price (S$)	Date
First Reit	OCBC	BUY	0.820	18/02/11
LippoMapleTrust	OCBC	BUY	0.590	17/02/11
MapleTreeInd	CIMB	OUTPERFORM	1.240	18/02/11

Latest updates at Stock Target Price.

Related Posts

• LippoMapleTrust Q4 2010 Quarterly Earnings Report 
• MapletreeInd Q4 2010 Quarterly Earnings Report
• First Reit Q4 2010 Quarterly Earnings Report

MapletreeInd - Date of Result Release for Q4 2010

Updated date of Result Release for Q4 2010:

MapltreeInd  JAN 25

Latest Update at Results Release.

All about REIT - The IPO Prospectus

In recent weeks we have seen an increase in the number of companies going for IPO. The most notable ones being that of Global Logistics Properties (GLP) and Mapletree Industrial Trust (MIT), which are linked to GIC and Temasek Holdings respectively. Just last week, we were looking at the listing of Sabana Reit, the first Shari'ah Compliant Reit in SGX.

For an IPO, the main avenue for retail investors to access and evaluate a company will be the IPO prospectus. However, it is very unlikely for someone to read the whole IPO prospectus because it is usually a few hundred pages thick. For example, the IPO prospectus for Sabana Reit comes with a whopping 480 pages! So what shall we look out for in an IPO prospectus? I will be sharing here some of the main items I will look at in the IPO prospectus for a Reit. Though the sharing here is Reit-centric, I think most of the things should apply equally well for the IPO of normal companies. I shall use the IPO prospectus of Sabana Reit as a reference here.

Where to Find the IPO Prospectus
First and foremost is of course where to get hold of the IPO prospectus. I remember few years back when I was working near the SGX centre, I will frequently see a desk being placed outside, with a staff manning a few hundred copies of the IPO prospectus whenever there is an impending IPO. Thanks to the advent of technology, now we no longer need to go all the way to SGX centre to carry back the very thick prospectus. With the MAS Opera site, we can easily download the PDF copy of the prospectus through the internet. You can easily find the MAS Opera site by googling for the phrase "MAS Opera". The site should appear right at the top or near the top.

Once you are in the main page of the MAS Opera site, you should be able to see a category called "Collective Investment Scheme Offers". The IPO prospectus for Reits can be found under this category. This category also includes prospectus of Unit Trusts to be launched by Fund Houses. For normal companies you should look under the category "Share Offers".

Preliminary and Final Prospectus
When a company or a Reit has announced its intention for listing, it will usually lodge a preliminary IPO prospectus with the Monetary Authority of Singapore (MAS) first. When its nearer to the IPO date, the final prospectus will be lodged. There shouldn't be too much differences in the contents, except that the final prospectus should provide details of the important dates for the IPO, such as the subscription period and listing date. Both the Preliminary and Final Prospectus can be found in the MAS Opera site.

The Cover Pages
Without even going into the main contents IPO prospectus, the cover and the first few pages alone will usually give you a general idea about the company/Reit. For the Sabana Reit prospectus, it has provided in its cover pages the summary information about its IPO price, number of units to be issued, its nature of business, its strategies, the projected yield, the indicative timetable, etc.

Use of Proceeds
We should get some idea of what the proceeds raised for the IPO will be used for. Other than for acquisition of the initial properties from the Sponsor, sometimes it may also be used for initial debt payment, which is the case for Mapletree Industrial Trust.

For Sabana Reit, the details of the Use of Proceeds can be found in Pg 75. Most of the proceeds of about S$885 million will go into Acquisition of the Properties, with about S$34 million as transaction costs.

Projected Yield
The projected yield is a very important information for Reits and it will usually be provided in the prospectus, as it is mandatory for Reits to distribute at least 90% of its distributable income. The projected yield is calculated based on the IPO offer price of the Reit. For IPO prospectus of normal companies, this information may not be provided as some companies may be more focused on growth, and thus the dividend payout may not be that predictable.

In the Sabana Reit prospectus, the projected yield can be found in the cover pages, and more details are provided in the "PROFIT FORECAST AND PROFIT PROJECTION" section on Pg 36. The projected yields for Sabana Reit are 8.22% and 8.25% for 2010 and 2011 respectively, based on the issue price of S$1.05. This information can then be used to compare with yields of other Reits, preferably in the same sector, i.e. industrial Reits.

Initial Gearing
Sometimes comparing yield with other Reits alone is not sufficient. We should also compare the gearing. Gearing is defined as the debt over the total assets.
The gearing may not be provided in a standard section in the prospectus. You can search for key words like "Gearing" or "Aggregate Leverage" to find it.

For the Sabana Reit prospectus, the gearing or aggregate leverage can in fact be found in quite a number of places. One such place will be the section on "Capital structure that provides stability and future financing flexibility". Here the figure provided is 26.5%. This is lower than most of the industrial Reits, which are around 30 to 39%.

Sponsor
The sponsor of the Reit may not be something quantifiable like the yield or gearing, but it does give us an idea of how well the Reit can be supported in times of need. Market may give the Reit a premium by virtue of its sponsor. Most of the earlier Reits have sponsors that are either listed blue chip companies (Capitaland, Keppel Land) or government linked private companies (Mapletree Holdings). Recently we are seeing listing of Reits by smaller players such as CWT, sponsor of Cache Logistics Trust.

In the prospectus for Reits, there is usually a section about the Sponsor. For the Sabana Reit prospectus, it can be found on Pg 160. The sponsor of Sanaba Reit is Freight Links Group, a leading international total logistics solutions provider with a strong presence in Singapore and the Asia Pacific region. It is also listed in the SGX mainboard, though many may not be familiar with it before the IPO of Sabana Reit.

NAV per Unit
The NAV per unit is usually used to compare with the share price of the unit to determine how much it is in discount or in premium. The IPO price is usually higher than the NAV per unit. It may not be favourable if the price has too much premium over the NAV per unit. You may also need to compare with the market whether Reits are generally trading in premium or discount, and by how much.

For Sabana Reit the NAV per unit is S$0.99. This can be found in the section "UNAUDITED PRO FORMA BALANCE SHEET AS AT THE LISTING DATE" on Pg 35. The IPO price of S$1.05 is at about 6% premium.

Pro Forma Financial Statements
The Pro Forma statements will help you have a rough idea of how the Reit is going to be performing after IPO, like what is the net profit is going to be like based on the initial portfolio of properties. But you must take note of the assumptions made in the prospectus in coming out with the figures. The Reit may not perform as indicated in the Pro Forma statements as they are after all derived based on the assumptions made.

Others
Although the above figures and information are important to look at in the prospectus, it doesn't mean that other information is not important. If time allows, you should try to cover as much of the prospectus as possible. Items such as Risk factors are definitely worth a look in helping to evaluate the IPO. It will be good if you can look for external sources of information about the Reit and its sponsor, such as any analyst report about the IPO to get a better picture.

Now the above figures are primarily useful for comparing with Reits of similar nature in the market. They are not useful for predicting the opening price on the listing day, as that is usually sentiments driven. Personally I find that compared to normal companies, it is easier to gauge whether the price of a Reit has run up too much on listing day, as its yield cannot be too far off from its peers in the market.

Related Links

• MAS Opera

Related Posts

• SABANA REIT - Admission of 632,800,000 units to the Official List of SGX-ST
• IPO of Mapletree Industrial Trust  
• About a Reit - IPO of Cache Logistics Trust 
• All about REIT - Rights Issue Part 2: What happens during a Rights Issue
• Other articles from All about REIT

IPO of Mapletree Industrial Trust

MIT started trading on 21 OCT 2010 2:00 PM. I was taken by surprise by its huge surge soon after trading begins to as high as S$1.20 intraday. Considering the IPO price of S$0.93, this is a rise of about 29%!

I have finally found some time to briefly go through the IPO prospectus of MIT a couple of days back, and would just like to present some figures which I think are important to the evaluation of the Reit.

The Sponsor
The sponsor of the reit is Mapletree Investments Pte Ltd, a fully-owned subsidiary of Temasek Holdings. This is definitely a positive factor to the value of the reit.

Yield
With reference to page 14 of the prospectus, under the section "Stable distributions", the projected yield based on the IPO offer price of S$0.93 is as follows:

	Distribution Yield (based on the Offering Price)
From the Listing Date to 31 March 2011	7.6% (annualised)
Projection Year 2011/2012	8.0%

So for 2010/2011, the annualised DPU is expected to be about 7.068 cents. For 2011/2012, it is expected to be 7.440 cents.

Based on the closing price of S$1.160 on the first day of trading, the expected yield is 6.09% for 2010/2011 and 6.41% for 2011/2012.

Distribution Policy
With reference to page 14 of the prospectus, under the section "Stable distributions":
"MIT’s distribution policy is to distribute 100.0% of its Adjusted Taxable Income (as defined herein) for the period from the Listing Date to 31 March 2012 and thereafter to distribute at least 90.0% of its Adjusted Taxable Income."

Distribution Frequency
With reference to page 64 of the prospectus, under the section on "Distributions", MIT’s first distribution after the Listing Date will be for the period from the Listing Date to 31 December 2010 and will be paid by the Manager on or before 1 March 2011. Subsequent distributions will take place on a quarterly basis.

We should be expecting the first distribution announcement sometime in Jan 2011 when the reit reports its quarterly results for the first time. The distribution will be for earnings for the period from 21 OCT 2010 to 31 DEC 2010, which is actually not a complete quarter.

Debt
With reference to page 66 of the prospectus, under the section on "Capitalization", the reit will fully draw upon a New Debt Facility on the Listing Date in an amount of S$837.0 million. There is an existing debt of S$977.8 million which was used to part refinance the acquisition of the MIT Private Trust Portfolio. This existing debt will be repaid on the Listing Date using proceeds from the IPO.


Asset Value & NAV
With reference to page 71 of the prospectus, under the section on "UNAUDITED PRO FORMA BALANCE SHEETS AS AT 31 MARCH 2010 AND THE LISTING DATE", the value of the Total assets on listing is about S$2164 million. The NAV per unit is S$0.86.

The IPO price of S$0.93 is 1.08 times above NAV per unit.
The first day closing price of S$1.160 is 1.35 times above NAV per unit. 

Gearing
We take the debt upon listing to be S$837 million. With the initial total assets of S$2164 million, the gearing will be about 38.6%. 

Some Thoughts
One obvious positive factor for this reit is having Mapletree as its sponsor. In one of my previous posts about Sponsors, I have mentioned that the sponsor has the unofficial role of supporting the reit in times of trouble. Mapletree is definitely capable of doing that. I would say at the IPO price of S$0.93, the yield above 7% is quite attractive. At S$1.160, the yield is still above 6% and is still on par with other reits with big name sponsors like Ascendas Reit, Capital Mall Trust, etc. But in terms of price over NAV per unit, at S$1.160, the ratio 1.35 times is definitely too high compared to most of the other S-Reits. One of the main negative factor about this reit, in my opinion, will be the gearing of 38.6%, which is towards the high side compared to other S-Reits. The reit was given a rating of BBB+ by Fitch on its listing day, meaning it can potentially gear up to 60%. Though there is still some debt headroom at 38.6% before it reaches 60%, in recent times it is not uncommon to see reits raising funds by equity (private placement or rights issue or both together) when the gearing is near or above 40%. When that happens, we will have to look out for potential dilution of the yield.

Related Posts
MIT assigned a final rating of BBB+ by Fitch - 21 OCT 2010
Mapletree Industrial Trust Final Ballotting Announcement - 20 OCT 2010
All about REIT - The Basics Part 5: Sponsors

MIT assigned a final rating of BBB+ by Fitch - 21 OCT 2010

Mapletree Industrial Trust gets final rating of BBB+; outlook stable from Fitch Inc. See press release.
 
Key Points

• Fitch has today assigned MIT a final rating of BBB+; outlook stable.

Author's Note
With this corporate rating by Fitch, MIT can now gear up to 60%, up from the 35% without rating.

Related Posts
All About REIT - The Basics Part 4: Gearing Limit

Mapletree Industrial Trust Final Ballotting Announcement - 20 OCT 2010

Mapletree Industrial Trust Final Ballotting Announcement. See press release.

Key Points

• Tranche and applications received for the Public Offer and the Reserved Units as at the close of the Offering (as defined in the Prospectus) are as follows:
• The Placement Tranche - Indications of interest were received for approximately 19.4 billion Units under the Placement Tranche, resulting in the Placement Tranche being approximately 39.6 times subscribed based on the 488,768,000 Units available under the Placement Tranche.
• The Public Offer - As at the close of the Public Offer at 8:00 a.m. on 18 October 2010, there were more than 86,000 valid applications for 80,645,000 Units (excluding the 25,500,000 Reserved Units which have been applied for by the Eligible Applicants) available to the public for subscription. In total, these applicants applied for approximately 2.2 billion Units. Based on the aforesaid, the Public Offer was approximately 27.7 times subscribed (based on 80,645,000 Units, which excludes the 25,500,000 Reserved Units).
• Reserved Units - As at the closing date for the application of the Reserved Units at 12:00 pm on 14 October 2010, valid acceptances were received for a total of 27,316,000 Reserved Units, and as a result, all 25,500,000 Reserved Units were allocated.
• It is expected that the Units will be credited to the securities accounts of the successful applicants with The Central Depository (Pte) Limited ("CDP") by 2.00 p.m. on 21 October 2010.
• The Units are expected to commence trading on a “ready” basis at 2.00 p.m. on 21 October 2010, subject to the SGX-ST being satisfied that all conditions necessary for the commencement of trading in the Units on a “ready” basis have been fulfilled. 

Author's Note
As per the announcement, the Reit is expected to commence trading in SGX at 2 PM on OCT 21 (Thur). The counter name and code is already available in the SGX website:
MapletreeInd  ME8U

Mapletree Industrial Trust to raise S$1.2b from unit sales - 29 SEP 2010

Source

SINGAPORE: Mapletree Industrial Trust has planned to raise as much as S$1.2 billion in gross proceeds from a sale of its units.

It's launching the initial public offering (IPO) to retail, institutional and cornerstone investors

Mapletree Industrial Trust said it was offering 594.9 million units in its IPO.

In a prospectus filed with the Monetary Authority of Singapore, the trust said the unit would be priced between 88 and 93 cents per unit.

Of the 594.9 million units offered by Mapletree Industrial Trust, 488.77 million units are being offered to institutional investors and 106.15 million to the public.

The company will also sell an additional 322.58 million units to cornerstone investors.

The nine cornerstone investors include APG Tactical Real Estate Poll, American International Assurance and Prudential.

Mapletree Industrial Trust will use the proceeds to buy six properties in Singapore and to repay debt.

Its portfolio comprises 70 properties located in Singapore.

The IPO could raise S$1.2 billion, making it Singapore's second biggest this year.

It comes hot on the heels of a S$3.9 billion IPO planned by GIC's logistics unit, Global Logistic Properties (GLP).

GLP's public offer opens on October 11 and listing is scheduled for October 18, while Mapletree Industrial Trust's public offer opens October 13 with listing due on October 21.

But dealer at Phillip Securities Melvin Ho said he did not think GLP would steal the thunder from Mapletree Industrial Trust.

Mapletree Industrial Trust is a unit of Mapletree Investments which is owned by Temasek Holdings.

In June, Mapletree Investments had said it planned to launch two REITS: a commercial property trust and an industrial property trust.