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.

Tuesday, November 9, 2010

Analysis of First REIT (Adjusted for Rights)

Current Price on 9th Nov 2010 = $0.98 (Pro forma at $0.713)
  • Current Yield = 8.66%
  • Price-to-book Ratio = 0.936
  • Assets per unit = $0.969  
  • Debt per unit = $0.207
  • Gearing = 21.3%
First REIT has launched its rights issue along with its acquisition plans which I felt was a great one. They are acquiring properties at a 19.7% and 13.8% discount for the two properties. This has helped to keep the price to book ratio below 1.00 which fits my criteria. Moreover, if you calculate the % yield on the properties (base rent/purchasing price), it is higher than 10% which helps to increase its yield from 7.92% to 8.66%. This again suits my criteria.

I will be subscribing to the rights which I am entitled to and hopefully get some extra units since the rights issue is so cheap. I am looking at this closely. If possible, I will increase my shareholdings first. 

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