Worst could be over for S-Reits even as analysts slash target prices

ANALYSTS have slashed their target prices for Singapore-listed real estate investment trusts (S-Reits) on higher-than-expected interest costs and foreign exchange woes. But a rebound in S-Reit prices in November has sparked hopes that the worst may be over.

Following the results for the quarter ended September, DBS Group Research cut distribution per unit (DPU) forecasts for FY2023 and FY2024 by 7 per cent as it revisited its estimates for the S-Reits.

“Based on our revised estimates, the S-Reits are now forecast to deliver a FY22-24 DPU growth of 2 per cent,” DBS analysts Derek Tan, Rachel Tan, Dale Lai and Geraldine Wong said in a recent report.

Excluding the hospitality sector, which is projected to deliver a two-year compound annual growth rate in DPU of 16 per cent through to FY2024, the rest of the S-Reits are expected…

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