Dasin Retail Trust’s price action suggests that the either the refinancing or the loan extension of the almost $500 million of loans that mature on July 18 has been successful. Of the $500 million, $419.5 million is offshore debt, and $80.1 million is onshore debt.
Dasin Retail Trust’s rebound in price, from a low of 46 cents to the close of 50.5 cents took place in the afternoon of July 16. During the morning, Dasin Retail Trust’s unit price remained weak. Even with the rebound, prices are still down 36% this year, and the stock is trading at just 0.35 times its net asset value - as at Dec 31, 2020 - of $1.41.
On July 5, Dasin’s manager announced that the trust’s sponsor and major unitholder Zhang Zhencheng signed a non-binding memorandum of understanding (MOU) with Sino-Ocean Capital Holding. An earlier non-binding MOU with ARA Asset Management was called off. The Sino-Ocean transaction includes the Chinese SOE taking a stake in the trust such that it would hold around 25% of the trust. Currently, Sino-Ocean owns 6.25% of Dasin.
See also: Dasin Retail Trust's sponsor ditches ARA for Sino-Ocean Capital; refinancing underway
To be sure Sino-Ocean is a more robust and stronger name for Dasin than ARA. In the meantime, despite strong overshold readings, short-term technical indicators did not quite form a positive divergence with price. However the bullish engulfing pattern on the candlestick chart indicates at least a temporary bottom, and is likely to herald a rebound of sorts. Resistance appears at the top of the shadow at 58.5 cents.
The chart pattern of the Straits Times Index looks stronger than its indicators suggest. The index, at 3,152, has managed to move above its 50- and 100-day moving averages which are at 3,141 and 3,138 respectively. Since the STI is able to close above the moving averages during a weekend, that signifies strength, and some buying demand. On the other hand, ADX continues to fall as the DIs turn negative. This indicates a sideways trend. Quarterly momentum is hovering just below its equilibrium line. Perhaps, we should go with the chart pattern and the STI’s attempt to strengthen. The breakout level should be raised to 3,178.
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