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.

Sunday, July 29, 2012

Analysis of FCOT

Current Price on 29th July 2012 = $1.10
  • Current Yield = 7.08%
  • Price-to-book Ratio = 0.738
  • Assets per unit = $2.978  
  • Debt per unit = $1.532
  • Gearing = 51.4% (not considering CPPU as assets)
  • Secured NAV = $0.387 (34%)
FCOT has published its quarterly results which shows a marked improvement in their DPU. They have also announced their progress in their plans which include buying back of CPPU, lowering debt using sale of Keypoint, and also AEI of China Square Central.

The price of FCOT has went up by quite a lot. With its current price at $1.10, the yield is only 7.08% and its price-to-book ratio is 0.738 which is one of the lowest in the market. Its secured NAV is $0.387 which is 34% of its trading price but I do expect this to increase once Keypoint is sold and the details are released.

The reduction of interest in debt will kick in this quarter and we shall see the full impact soon. Considering this, and all the plans that they have executed or are executing, I am making a prediction that its yield will be 7.79% for next year. Considering that we do not have much REIT trading at 8.0% and above, I will still hold on to this until its yield drops below 7%. 

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