“We believe MLT can now focus on growth again with DPU stabilising. The planned disposal of its China properties to its Sponsor’s RMB fund in 2Q2026 would enable MLT to recycle its portfolio into higher-yielding and growth properties in Malaysia, India and Vietnam. The trailing 4Q2026 annualised NPI yield for MLT’s China portfolio stands at 3.3%-3.4% versus potential 6%-8% acquisition yields for Malaysia, India and Vietnam properties. In our estimates, we assume $200 million of divestments, including in China, will be recycled into $200 million of acquisitions at an initial 6% NPI yield,” Song and Khi suggest.
In a report dated May 21, JP Morgan maintained an overweight rating for Mapletree Logistics Trust (MLT) but revised its price target down by 10 cents to $1.40 by end-June 2027. The analysts Mervin Song and Terence Khi believe that the worst is over for the time being, and its distributions per unit (DPU) have stabilised.
The 4Q2026 core DPU excluding top-ups, announced on April 29, rose 0.9% y-o-y, the first increase in over three years and the fourth consecutive q-o-q increase. Positive rental reversions outside China have mitigated the drop in China rents as well as FX and interest rate headwinds. While the prospects of China reversions reverting to neutral have been delayed by a few quarters, guidance of low to mid single-digit rental reversions across MLT’s portfolio suggests that MLT’s DPU should remain resilient, the report says.
