“With large cap industrial Singapore REITs trading at around 20 bps premium over its mid cap peers, we believe that the market has yet to re-rate ESR-LOGOS REIT, despite its ability to access a significant pipeline of assets and support from an enlarged sponsor group,” says Tan and Lai. “In the medium term, as ESR-LOGOS REIT executes on its value-accretive plans, we expect its P/NAV to trade closer to its large cap peers, implying an approximate 18% upside to its share price from current levels.”
DBS Group Research analysts Dale Lai and Derek Tan have kept a “buy” rating on ESR-LOGOS REIT with a target price of 50 cents.
After ESR-LOGOS REIT’s successful merger with ARA LOGOS Logistics Trust (ALOG) in April, the REIT is now the fifth largest industrial Singapore REIT with a total asset base of approximately $5.5 billion but has yet to see a re-rating.
