“Overall, we are slightly negative on the deal due to significant dilutive equity fund raising and tight pricing, and believe funding should have been from divestments instead,” Natarajan writes in his note on Jan 2, adding that he recommends investors who are looking for Singapore office exposure to buy Suntec REIT (SGX:T82U
) (target price: $1.60) instead.
RHB Bank Singapore analyst Vijay Natarajan is maintaining his “neutral” call on Keppel REIT (SGX:K71U) but is lowering his target price for the REIT to 98 cents from $1.05.
According to Natarajan, Keppel REIT’s acquisition of an additional one-third stake in Marina Bay Financial Centre (MBFC) Tower 3 is dilutive to both the REIT’s distribution per unit (DPU) and net asset value (NAV).
