Current Price on 17th July 2012 = $1.135
- Current Yield = 6.84%
- Price-to-book Ratio = 0.858
- Assets per unit = $2.392
- Debt per unit = $1.069 (including current liabilities)
- Gearing = 44.7%
- Secured NAV = $0.695 (61%)
K-REIT Asia has reported its results yesterday which is not surprising to me. Yield went up by 2% compared to previous quarter which is good and I will be getting a handsome dividend of 3.84 cents which worked out to $614 for me.
What is surprising is the surge in its trading price which currently stands at $1.135 today. As the price goes up, its current yield will fall and now it is below 7% which to me is very low. Even its price-to-book ratio is now at 0.858 which is higher than CCT and FCOT. To me, it has become more like a growth REIT and I believe it is priced in already.
Looking at the developments in the current quarter, we are expecting increase in full quarter distribution from conversion of MBFC to a LLP which gives us a bit more money. And we are also expecting ORQPL to be converted as well. Apart from all these, with an occupancy at 97%, upside of its current distribution look limited. If they were to grow, it should be by acquisition and they will need to raise cash.
I am vested with 16,000 shares. And I think K-REIT Asia has served its purpose in delivering its results to suit my needs through both distribution and capital appreciation. I will need to think through seriously whether to offload this and look for REITs which fulfil my criteria.
What is surprising is the surge in its trading price which currently stands at $1.135 today. As the price goes up, its current yield will fall and now it is below 7% which to me is very low. Even its price-to-book ratio is now at 0.858 which is higher than CCT and FCOT. To me, it has become more like a growth REIT and I believe it is priced in already.
Looking at the developments in the current quarter, we are expecting increase in full quarter distribution from conversion of MBFC to a LLP which gives us a bit more money. And we are also expecting ORQPL to be converted as well. Apart from all these, with an occupancy at 97%, upside of its current distribution look limited. If they were to grow, it should be by acquisition and they will need to raise cash.
I am vested with 16,000 shares. And I think K-REIT Asia has served its purpose in delivering its results to suit my needs through both distribution and capital appreciation. I will need to think through seriously whether to offload this and look for REITs which fulfil my criteria.
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