DMG Research has put a "buy" call on Suntec Reit at a target price of S$2.00.
Noting that Suntec Reit shot to the top of the most active stock list after a huge volume of 129.3 million units took place minutes after the 5pm close on Tuesday, the research house said 180.2 million units changed hands in all, nine times Monday's trading volume.
The unit price, too, rose three cents to hit a one-year high of S$1.935 - the same price at which the surprise trades were done during the adjustment period after normal closing.
"This could be due to Suntec Reit replacing Olam International in the MSCI Singapore Index from Wednesday onwards. On price performance, Suntec Reit is up 25.6 year-to-date and is the best-performing Reit this year," said DMG.
As at 11.20am, the Reit hit a high of S$1.94, with almost 32.9 million shares changing hands.
DMG said that it was "overall optimistic" on the Reit's asset enhancement initiatives (AEI) at Suntec City and remained confident that the trust would achieve average rentals above its original target of S$12.59 psf per month, following the completion of all three phases at Suntec City Mall. "We forecast Suntec's distribution per unit to grow at a compound annual growth rate of 3.4 per cent over the next three years. We believe that Suntec's near-term share price performance will be supported by the completion of its AEI at Suntec City Mall," added DMG.