Starhill Global Reit
Buy
DBS Group Research | April 1
April 1 close: S$0.785
Target price: S$0.84
WE believe that the upcoming rent review for the Toshin lease at Ngee Ann City is a near-term catalyst. This rent renewal will have a significant impact on distributions as Toshin accounts for about 19 per cent of top line in the FY16 forecast. Toshin renewed the lease for a further 12 years starting June 2013. The rent review mechanism only allows for upward adjustment in rents, capped at 25 per cent. This implies that the Reit's earnings growth profile is projected to grow at a steady 2-3 per cent rate in the coming two years...
In our estimates, we have assumed a 6 per cent increase come June 2016....
Keyword added to your list