Contrary to consensus suggestions that the REIT’s unit price should trade at a discount to book value considering its expected fall in FY18 DPU, Song has instead chosen to focus on projected DPU growth from 2019 onwards, which would mark the first y-o-y increase in DPU in over five years.
SINGAPORE (July 17): DBS Vickers Securities and CGS-CIMB Securities are maintaining their respective “buy” and “add” calls on Keppel REIT (K-REIT) with unchanged price target estimates of $1.41 and $1.34, after the REIT’s 2Q DPU of 1.42 cents came in within both research houses’ expectations.
In a Tuesday report, DBS analyst Mervyn Song says he remains positive on the REIT on the belief that office rents are on a sustained upturn, with K-REIT’s unit price expected to stage a rally following the correction in recent months.
