Welcome to my investment blog where I share with you my analysis of REITs in Singapore.

I hope that my investment philosophy will bring me a steady stream of income apart from my job. I am aiming for at least $3,000 per month which can sustain the current expenses of myself and my family.

Do enjoy reading my blog and post any comments that you have. I welcome them because it is a time to learn from each other.

When I am looking at investing in REIT, here are some of the guidelines that I am looking at. Feel free to comment on it. I am willing to listen to ideas.

-> at least 8% yield.
-> Price that is lower than its NAV.
-> Low gearing (if possible)
-> High secured NAV.

Current Dividend income is $3,800/month.

Friday, April 8, 2011

Analysis of Mapletree Commercial Trust (MCT)

IPO Price  = $0.84 - $0.91
  • Current Yield = 5.47%
  • Price-to-book Ratio = 0.998
  • Assets per unit = $1.550  
  • Debt per unit = $0.631
  • Gearing = 41.2%
  • Secured NAV = $0.911

Mapletree Commercial Trust is one new IPO which will be launched soon to retail investors. Taking a look at the statistics actually does not look appealing to me. It has a low yield of 5.47% based on $0.91 which is comparable to  its peers like Suntec REIT and CapitaCommercial Trust. Moreover, CapitaCommercial Trust is currently trading at a discount (Price-to-book ratio of 0.947) which is more favourable than MCT.

The good thing is that it uses unsecured debts to fund their purchases of properties which means the NAV is actually quite secured. This should give investors a sense of security.

As usual, I am looking at the final pricing of this IPO. If it is priced at $0.91, that means that there is demand and there are reasons to apply for a quick profit. Anything below that means that the demand is low and should not move above its final IPO  price. In any case, it has not fulfilled my criteria so I am not interested.

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