Brokers' take

Singapore Reits | Chance to accumulate

DBS Group Research, Nov 8

WE believe that investors will continue to focus on yields given the uncertain economic outlook and we believe that Reits fit that bill. Interest rates, while an overhang, are mitigated from the fact that most S-Reits have (i) refinanced their loans ahead of expiry, and (ii) hedged in a substantial portion of their interest rates profile into fixed rate debt. Among S-Reits, we believe that selected office Reits (Keppel Reit) and hospitality Reits (CDReit) are attractive at a 15-20 per cent discount to net asset values (NAVs). In terms of growth, we believe the likes of Ascendas Reit (A-Reit), Frasers Logistics & Industrial Trust (FLT) and Mapletree Commercial Trust (MCT) offer investors a clear growth driver and upside to earnings from deploying their strong balance sheets. Among the small-cap Reits, Croesus offers attractive yield of more than 8 per cent.