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, June 24, 2014

IPO Analysis of Fraser Hospitality Trust

IPO Price on 23rd June 2014 = $0.88
  • Yield = 6.90%  
  • Price-to-book Ratio = 1.068
  • Assets per unit = $1.446
  • Debt per unit = $0.622 (including current liabilities)
  • Gearing = 43.0%

Fraser Hospitality Trust has priced its IPO at $0.88 today without an indicative range. This is a good strategy for them but not for us because we won't be able to gauge the demand of this trust. Moreover, the yield at 6.90% is not really true because of a "top-up" as shown in their documents.

Looking at an earlier report in FinanceAsia (http://www.financeasia.com/News/387688,frasers-hospitality-trust-pre-markets-ipo.aspx) and assuming that they are correct, Fraser Hospitality Trust has priced it in the mid-point of their indicative range. It represent that it is a fairly-valued pricing and they are unwilling to pay more for this trust. 

My guess is that their opening price and its IPO price will be roughly the same so I won't be rushing into this IPO.

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