not vested
Keppel DC REIT: Prepare for further inorganic growth
Keppel DC REIT (KDCREIT) reported its 2Q18 results which met our expectations, with DPU growing 4.6% YoY to 1.82 S cents.
We expect a stronger 2H18 as KDCREIT had only completed the accretive acquisition of a 99% interest in Keppel DC Singapore 5 on 12 Jun this year.
Nevertheless, we trim our FY18F DPU by 2.2% due to a timing issue from KDCREIT’s recent equity fundraising exercise, whereby its private placement of 224m new units was issued on 16 May versus our previous assumption of 30 Jun 2018.
Our FY19 forecasts and fair value estimate of S$1.54 remain intact.
Looking ahead, management remains active in sourcing for further inorganic growth opportunities.
Given its healthy aggregate leverage ratio of 31.7% (as at 30 Jun 2018), we believe KDCREIT has ample debt headroom to make more DPU accretive acquisitions in the near future.
Source: OCBC