Ascendas India Trust H1 DPU down 9% to 4.20 Singapore cents, as exchange rate proves a drag

BUSINESS park landlord Ascendas India Trust will make a distribution per unit (DPU) of 4.20 Singapore cents for the first six months, the manager said on Wednesday.

The payout was lower by 9 per cent on the previous year's DPU of 4.64 cents, no thanks to a weaker rupee and a one-off reversal of a dividend distribution tax provision.

Distributable income shrank by 8.8 per cent to S$53.8 million for the six months to June 30, going by financial statements released after the market close.

Net property income grew by 5.2 per cent to S$77.3 million amid lower property expenses, even as total property income dropped by 3.6 per cent to S$95.4 million, on the back of unfavourable currency exchange.

In rupee terms, net property income rose by 10.1 per cent, while total property income inched higher by 0.9 per cent, on revenue contributions from a building that was completed last November and another asset acquired in March this year.

Noting that occupancy fell four percentage points in the half-year, Sanjeev Dasgupta, chief executive of the manager, said in a statement that "the leasing environment remains challenging".

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Portfolio weighted average lease expiry was 3.5 years as at end-June, with committed portfolio occupancy of 90 per cent. The manager blamed a year-on-year decrease in occupancy, as well as utilities and car park income, on the Covid-19 pandemic.

Still, the manager told unitholders that construction work for its ongoing projects have improved since end-June, on the relaxation of Covid-19 restrictions.

The trust aims to nearly double completed portfolio area from 14.4 million square feet (sq ft) to 25.2 million sq ft in "the next few years", including its committed pipeline.

Mr Dasgupta added: "We have added new economy asset classes such as data centres and industrial into our committed growth pipeline to improve portfolio resilience."

Under the trust's asset diversification plans, business park space will go from 94 per cent of existing portfolio to a 92 per cent share, while logistics assets will go from 6 per cent to 5 per cent. Industrial area will make up 2 per cent, and data centres, 1 per cent.

Ascendas India Trust has a portfolio of seven tech parks in the cities of Bengaluru, Chennai, Hyderabad and Pune, and a logistics park in Panvel, near Mumbai.

Units closed flat at S$1.45 on Wednesday, before the results were released.