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.

Monday, June 24, 2019

Analysis of Mapletree Logistics Trust - Is it worth the price?

Current Price on 15th June 2019 = $1.58
  • Yield = 5.12%  
  • Price-to-book Ratio = 1.35
  • Assets per unit = $2.23
  • Debt per unit = $1.06 (including current liabilities and perpetual securities)
  • Gearing = 47.5%
  • Secured NAV = $1.17 (74% of trading price)
One of my friends messaged me saying that he has bought into Mapletree Logistics Trust and it prompts me to just take a look at it. MLT's share price shot up by a lot recently from $1.23 at the start of the year to its current price at $1.58. I took time to look at the statistics of this REIT.

Their yield is now at 5.12% which is quite low, probably the lowest among the industrial REITs. Their price-to-book ratio also seems to be very high at 1.35 which means we are buying at a premium of 35%. Their gearing is also quite high considering perpetual securities and non-controlling interest at 47.5%. The only saving grace is that they do have secured NAV of $1.17 which is 74% of its current trading price.

I wonder what prompt my friend to buy into this counter at this price where there are other suitable ones. Even if you are looking for a very strong sponsor, there is still Ascendas REIT and Fraser Logistics and Industrial Trust or even Mapletree Industrial Trust which all have better statistics. The only thing that would keep this counter at this price is the Fed Rate cut which benefit all REIT counters. I am not optimistic and think that this price is not sustainable.

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