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, September 29, 2011

Analysis of LMIR

Current Price on 28th Sept 2011 = $0.53
  • Current Yield = 8.83%
  • Price-to-book Ratio = 0.611
  • Assets per unit = $1.156
  • Debt per unit = $0.312 
  • Gearing = 25.9% (include current liabilities which are not loans)
  • Secured NAV = $0.466
Lippo Malls Indonesia REIT has given details on their refinancing of loans which in my view is very favourable. They have managed to achieve three things. Bigger loan + lower interest + lesser properties pledged as securities. Based on my initial calculations, they are able to increase DPU payouts by about 10% despite getting a bigger loan. This would show when they report their results next January/February (Not in coming October/November).

Moreover, they are able to use lesser properties which means that they have unencumbered properties of $500 million. This translate to a secured NAV of $0.466. This means that most of the monies invested at current price will be secured without the risk of being seized by banks should something happens. I view this as a great positive news.

At current price and yield and discount to NAV, I am looking for money to invest in this counter.

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