SGX Stocks and Warrants

Author: kimeng   |   Latest post: Tue, 24 Apr 2018, 02:21 PM


Lippo Malls Indo Retail Trust (LMIRT): New Tax Regulations to Hit DPU; Rating Under Review

Author:   |    Publish date:

Lippo Malls Indonesia Retail Trust (LMIRT) announced yesterday that Indonesia has passed new tax regulations on income received/earned from land and building leases in the country. In particular, such income will be subject to a 10% tax on the value of the amount collected by tenants, including service charges and utility coverage charges. The new regulation is effective 2 Jan 2018.

For the purposes of illustration, assuming the new regulations were in effect as of 1 Jan 2017 instead, the REIT manager calculates that FY17 DPU would have been 7.2% lower at 3.19 S cents (pro forma) instead of 3.44 S cents (actual). A DPU of 3.19 S cents works out to a historical dividend yield of 8.4% against yesterday’s closing price of S$0.38. We believe the news will prompt selling pressure on the counter.

As we use a dividend discount model to value the REIT, a hit to future projected dividends will have a negative impact on our fair value of S$0.405. We place our Hold rating and fair value on LMIRT under review.

Source: OCBC Research - 12 Apr 2018

Share this

Related Stocks

Chart Stock Name Last Change Volume 
Lippo Malls Tr 0.32 0.00 (0.00%)

  Be the first to like this.



Top 10 Active Counters
 Powermatic Data 1.600.00 
 NX09100W 190601 94.000.00 
 NY09100H 240901 109.9520.00 
 Tai Sin Electric 0.390.00 
 3Cnergy 0.0210.00 
 KLW 0.0070.00 
 AsiaMedic 0.0490.00 
 Fuji Offset 0.2450.00 
 Hiap Seng 0.1210.00 
 Second Chance 0.2450.00 
Partners & Brokers