CapitaLand Integrated Commercial Trust (Merger CMT & CCT)

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Not vested.

DATE OF RELEASE OF 3rd QUARTER 2009 FINANCIAL RESULTS

CapitaMall Trust Management Limited, the manager of CapitaMall Trust (“CMT”),
wishes to announce that it will release CMT’s financial results for the 3rd Quarter of
2009 ended 30 September 2009 before 8.00 am on Thursday, 22 October 2009.

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CAPITACOMMERCIAL TRUST - CapitaCommercial Trust, which is managed by CapitaLand , said on Wednesday its distributable third quarter income rose 21 percent and its distribution per unit rose 20 percent from a year ago to 1.85 cents, as it continued to sign new leases and renewals.

Source: Reuters

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CapitaMall Trust - Real estate investment trust CapitaMall Trust said its distributable income for the third quarter rose 23.3 percent from a year earlier as the property market sees signs of revival.

Source: Reuters

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Not vested. From UOBKH:-


Earnings Revision

The domestic economy was still in the doldrums when we upgraded CMT from SELL to BUY on 9 Jun 09. We now expect portfolio occupancy to be stable at 99.5% compared with our previous assumption of deterioration to 94%.

We have therefore raised our 2010 and 2011 DPU forecasts by 7.0% and 17.9% to 9.2 cents and 9.2 cents respectively.


Valuation/Recommendation

Maintain BUY for CMT with a target price of S$2.06, based on a dividend discount model (required rate of return: 7.2%, growth: 3.0%). In the near term, CMT will have to ride through the repositioning of funds in preparation of the initial public offering for CapitaMall Asia.

Both companies have different risk-return profiles. We remain positive on prospects for CMT in the medium to long term due to the strategic location of its shopping malls and its expertise in retail management.

[winston]

Not vested. From OCBC:-

CapitaMall Trust: AEI engine re-ignited

Summary: CapitaMall Trust reported its 3Q09 results yesterday and they were in line with our expectations. Gross revenue increased to S$129.7m, driven by the acquisition of Atrium and completion of asset enhancement initiatives (AEI) at several malls. Net property income had also increased to S$94.5m.

Portfolio occupancy rate remained strong at 99.6% at end-3Q09 and CMT also managed to achieve better rental reversions in 3Q09. DPU of 2.35 S-cents has been declared for the quarter. Slow recovery in consumer spending is likely to cap any rental increase going forward. Nevertheless, growth could still be sustained by AEI and reconfigurations.

CMT has proposed to build a new underground link connecting Raffles City to Esplanade MRT Station, which is expected to start in 4Q09. Opportunities for acquisition are also opening up.

We are now raising our fair value of CMT to S$1.69 but maintain our HOLD rating on valuation ground. (Foo Sze Ming)

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Not vested. From Kim Eng:-

CapitaMall Trust – Company Update (Wilson LIEW, DID: 64321454)
Previous Day Closing price: $1.72
Recommendation: BUY (upgraded)
Target price: $1.96 (upgraded from $1.69)


Interest in suburban malls is apparent

The tender for Clementi Mall in early November drew a healthy response of six bids and the winning bid by a consortium led by SPH translated to a breakeven of nearly $3,000 psf. CMT’s bid of $338.8m, which translated to a breakeven of about $2,000 psf, came in third. We believe that developers remain selectively keen on suburban mall developments, especially in areas which are still underserved by well-managed malls.
CMA’s platform is a boon to CMT Investor interest in the retail sector was evident with the successful IPO of CMA.

The management of CMA (which has taken over CapitaLand’s 29.9%-stake in CMT) reiterated that CMT is an integral part of the business, as completed retail malls in Singapore will eventually be injected into CMT. We believe that the synergies with CMA are tremendous, as CMT can tap on CMA’s huge tenant pool for its malls, while CMA undertakes the development risks.


Suburban retail positioning exhibits resilience

The Retail Sales Index (excl. motor vehicles) has rebounded off its February 09 low by about 7.5% (at constant prices) as of September. Necessity shopping categories have shown resilience, mitigating waning discretionary shopping. This explains CMT’s high portfolio occupancy rate through the downturn, and we do not see direct competition from new upmarket malls like Marina Bay Shoppes and 313@Somerset.


Still remember the Jurong Lake District?

The blueprint for Jurong Lake District was unveiled over a year ago under the Master Plan 2008, and it will be the biggest commercial hub outside the city to be built over the next 10-15 years (5.4m sq ft of office GFA, >2,800 new hotel rooms). We think that CMT’s redevelopment of JEC is timely and together with IMM, they will be key beneficiaries as the district eventually takes shape.


5.2% yield is looking increasingly attractive

We have increased our DDM-derived target price to $1.96, as we lowered our cost of equity assumption to 8%, and also upgraded our occupancy assumption from 95% to 98.5% for its major malls in 2010. At the current price, we expect a 5.2% DPU yield for FY10 and its AEIs will underpin organic growth going forward. At almost double the 10-year government bond yields, CMT’s DPU yield looks increasingly attractive. Upgrading to a BUY recommendation.

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Not vested. From Kim Eng:-

Great opportunity to take profit

We have raised our target price to $0.99, as we lowered our cost of equity assumption to 8.5%. We believe the management has the capabilities to mitigate negative rental reversions via cost cutting measures and prudent capital management, but the share price has run ahead of fundamentals.

We are downgrading it to a SELL on valuation grounds, preferring re-entry at $0.93 for 15% total returns.

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CAPITAMALL TRUST - CapitaMall Trust, a Singapore property trust, reported on Friday an 18.3 percent rise in its full-year distributable income to unitholders to S$238.4 million ($170 million), helped by jumped in interest income and property management fees.

Source: Reuters

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Not vested.

RESEARCH ALERT-Citi upgrades CapitaCommercial to "Buy"

SINGAPORE, Feb 22 (Reuters) - Following is a list of stock price target changes and rating changes.

COMPANY RIC BROKER RATING (PVS) TARGET PRICE (PVS) CAPITA- CITI BUY (SELL) S$1.11 (S$1.11)

COMMERCIAL TRUST STATEMENT: Following recent share price weakness, we are upgrading CapitaCommercial Trust to BUY.

Despite our cautious outlook on the Singapore office market given the impending supply scheduled for completion in the coming 2-3 years, CapitaCommercial Trust appears attractive from a valuation perspective after having fallen almost 15 percent in the past month.

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Not vested. From OCBC:-

CapitaCommercial Trust: Working towards refinancing

Summary: Recently, CapitaCommercial Trust (CCT) issued S$70m of fixed rate Medium Term Note and repurchased an aggregate principal amount of S$15m of its convertible bonds (CB) that mature in 2013. This is part of the effort to prepare for its refinancing requirement in 2011 as the CB holders have a put option exercisable in May 2011.

We expect average cost of debt to trend higher in 2010 as the cheaper MTN issued prior to the crisis matures this year and is refinanced by new MTNs with higher cost of debt. Nevertheless, we are still encouraged by the pro-active efforts that the management took to prepare for refinancing next year.

We maintain our estimates and keep our RNAV and fair value unchanged at S$1.16. With a projected total return of 8.4%, we maintain our HOLD rating on CCT. S$1.05-S$1.10 would be good entry level for accumulation, which would translate to a potential total return of 11.3%-16.6%. (Foo Sze Ming)