Analysis of Keppel REIT - Quality Office at a Bargain Price

Current Price on 8th Jan 2015 = $0.915

• Yield = 7.43%  
• Price-to-book Ratio = 0.648
• Assets per unit = $2.309
• Debt per unit = $0.897 (including current liabilities)
• Gearing = 38.8%

Keppel REIT was once my anchor investments which has given me a great deal of rewards with strong yield and capital appreciation. Now I realize that it has fallen to a level which attracts my interest.

With a yield of 7.43%, it is not really fantastic although it is still quite high among the office REITs. But what attracts me is their price-to-book ratio which is at 0.648. This means we are buying at 35% discount to NAV which is quite a bargain. Compared to the largest office REIT which is Capital Commercial Trust, it is still about 10% cheaper. Gearing is at a healthy 38.8% which is not in danger.

The yield and price-to-book ratio caught my eye and I am willing to consider reinvesting into this counter since the statistics is quite good actually. Let's see if there are other good counters around first.