In an April 25 note, Lim maintains "buy" on OUE REIT (SGX:TS0U
) with a lower target price of 31.5 cents from 34.5 cents previously.
OUE REIT, which divested Shanghai commercial asset Lippo Plaza Shanghai in December 2024, saw revenue and net property income (NPI) fall 11.9% and 12.1% y-o-y to $66.0 million and $53.2 million in 1QFY2025 ended March 31. On a like-for-like basis, revenue and NPI would have moderated 3.9% and 4.1% y-o-y respectively.
But the diversified REIT is also facing some weakness in its hospitality segment. OCBC Investment Research analyst Ada Lim thinks this weakness is "more pronounced than previously expected", with the hospitality segment seeing revenue and NPI plunge 13.3% and 12.5% y-o-y to $23.3 million and $20.8 million respectively.
