Brokers' take

Frasers Logistic and Industrial Trust | Buy Target price: S$1.08 Feb 7 close: S$0.97 OCBC Investment Research, Feb 7

Frasers Logistics & Industrial Trust (FLT) reported its 1QFY17 results which met our expectations. Gross revenue came in at A$39.7m, which was slightly lower than its IPO Prospectus forecast (proportionally pro-rated for the quarter) by 1.5 per cent. However, its DPU of 1.74 S cents exceeded its prospectus forecast by 6.1 per cent and was driven mainly by lower-than-expected finance costs.

Looking ahead, we expect its portfolio to remain resilient, as it has minimal lease expiries during the years ending Dec 31, 2017 and Dec 31, 2018. FLT's portfolio occupancy stood at a healthy 99.3 per cent, as at Dec 31, 2016, and it also has a long portfolio weighted average lease-expiry of 6.9 years. FLT has a low gearing ratio of 29.7 per cent as at end-1QFY17.