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.

Thursday, May 18, 2017

Analysis of Lippo-Malls Retail Trust - Fairly Valued

Current Price on 10th May 2017 = $0.415
  • Yield = 8.58%  
  • Price-to-book Ratio = 1.114
  • Assets per unit = $0.715
  • Debt per unit = $0.342 (including current liabilities)
  • Gearing = 47.9%
  • Occupancy = 93.8%
  • Secured NAV = $0.373 (86% of trading price)
LippoMalls Retail Trust has announced their results which is improving. However, their price went up by a lot as well so let's see how the statistics fare.

With a yield of 8.58%, it is now not the highest yielding REIT. There are others like Viva Industrial Trust and Soilbuild Business Space REIT which has higher yield. However, their price-to-book ratio is 1.114 which means we are buying at a 14% premium. This is not attractive at all. Gearing is at 47.9% with current liabilities and only unsecured debt. This means that their secured NAV is quite high at 86% of trading price. Still quite high but not as attractive as before. Please note that all assets are based in Indonesia.

Indonesia continues to grow at a moderate pace of 5% which I thought it was nice to be able to participate in their growth. This is probably the reason why it is priced high. But I think it is now fairly priced and it shouldn't be moving higher anymore. I will find chance to sell my current holdings.

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