No surprises from Ascendas REIT

SINGAPORE (Oct 21): Credit Suisse is maintaining a “neutral” rating on the Ascendas Real Estate Investment Trust (AREIT) with a target price of $2.58 while CIMB is downgrading the REIT to a “hold” with a lower target price of $2.47 from $2.61.

On Thursday night, AREIT declared 7.9 cents distribution per unit for 1HFY16, which represented 51% of CIMB and Credit Suisse’s full year forecasts.

CIMB’s Yeo Zhi Bin wrote in a note on Friday that — excluding a one-off distribution — the REIT’s DPU had risen 3.6% to 4.03 cents during the quarter from the acquisition of the Australian portfolio and ONE @Changi City. Revenue had risen 12.5% and net property income had risen 23% given the lower utilities and property tax expenses.

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