| CGS CIMB |
MAYBANK KIM ENG |
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OUE Hospitality Trust Stronger RevPAR in 2018
■ FY18 DPU of 5.14 Scts (-2.9% yoy) was in line with our expectations at 101% of our forecast. ■ While its hospitality segment was impacted by lower banquet sales, revenue per available room (RevPAR) strengthened yoy. ■ Maintain Add and DDM-based TP on attractive yield.
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After the rain comes a rainbow
Strong 2020E after 2019E speed-bump; Initiate BUY
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| UOB KAYHIAN | OCBC |
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REITs – Singapore 4Q18: ART (In Line), CDREIT (Above)
ART reported DPU growth of 5.4% yoy with healthy organic growth augmented by Ascott Orchard Singapore, which was acquired in Oct 17. Maintain BUY with unchanged TP of S$1.15. CDREIT saw encouraging improvements at its Singapore properties, with REVPAR (excluding Orchard Hotel) growth of 4.3% yoy. Maintain BUY with unchanged TP of S$1.83. Maintain OVERWEIGHT.
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Ascott Residence Trust: 4Q results beat!
Ascott Residence Trust's (ART) 4Q18 results beat expectations. 4Q18 DPU increased 5% YoY to 2.15 S cents. FY18 DPU was up 1% to 106% of our initial full-year forecast, in part due to higher than forecasted capital distributions made during 4Q18. Excluding capital distribution, ART’s FY18 distributable income came to 103% of our initial full-year forecast, which we consider above expectations. 4Q18 portfolio RevPAU grew 5% YoY to S$163, with 8 out of 12 management contract geographies clocking positive RevPAU growth in SGD terms. After adjustments, our fair value increases from S$1.18 to S$1.25. ART is currently trading at a 5.9% FY19F dividend yield. ART boasts a highly geographically diversified portfolio of high quality assets and given the ongoing macroeconomic uncertainties we look upon this defensive positioning favourably. In addition, we believe the debt headroom of close to S$1b post the divestment of Ascott Raffles Place will offer ART greater flexibility to pursue DPU accretive acquisitions. Since our upgrade from Hold to Buy on 10 Jan 2019, ART has posted total returns of 6.4%, beating the Straits Times Index (STI) as well as the FTSE Straits Times REIT Index (FSTREI) by 5.0 ppt and 2.7 ppt respectively. We maintain BUY with a fair value of S$1.25. |
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