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.

Saturday, January 28, 2012

Analysis of CapitaMall Trust

Price on 26th Jan 2012 = $1.705
  • Current Yield = 5.35%
  • Price-to-book Ratio = 1.082
  • Assets per unit = $2.756
  • Debt per unit = $1.18
  • Gearing = 42.8%
  • Interest Cover Ratio = 5.5 times
  • Secured NAV = $0.894 (52.43%)
CapitaMall has delivered their results of 5.35% yield and they are trading at a premium of 1.082. They are the market leader with $9.1 billion dollars worth of assets and cash. To me, they have become the benchmark of retail REITs in Singapore which others will need to compare themselves to.

As they are the "benchmark", it is deemed to be relatively safer than other smaller REITs (with a corporate rating of A2, better than some countries). Thus, if your risk appetite is not high, this would be a stable REIT to start with. However, for the same reasons their statistics have become not attractive at all. All indicators are way off my criterias. Mapletree Commercial Trust are trading at a higher yield. Moreover, it is also quite safe. Starhill Global and FCT has moved on to overseas properties which has a higher risk.

It would be good to use it as a benchmark and compare other REITs against it rather than using other indicators like government bonds as always shown in the REIT slides. But I won't be investing in this.

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