Mapletree Industrial Trust ("MIT") announced its 1Q FY16 (Y/E Mar) results on 21 July after trading hours. We tuned in to the Analyst Briefing conference call earlier this morning.

Analyst briefing key takeaways

Manageable lease expiry profile for the remainder of the FY. 9.8% of the portfolio by Gross Rental Income is up for renewal in this FY. Two large tenants of Johnson & Johnson (2.2%) and Dell (1.3%) have already renewed their leases at The Strategy at International Business Park. Their rents are very close to their original rents.

Healthy demand for MIT space. About 30%-36% of space that was not renewed during 1Q16 has been let out to new tenants, with the tenancy due to start in the next quarter. Occupancy for Hi-Tech Buildings was lower q-o-q, but this was due to inclusion of the Equinix data centre into the portfolio.

Median rent for Business Park space for the quarter has been skewed upwards by new space at one-north. This is because rent at one-north is generally higher than other Business Parks.

Positive catalyst from build-to-suit (BTS) project. This is a S$226 million BTS Hi-Tech Building with 100% by Hewlett-Packard. Phase 1 and Phase 2 are slated for completion in 2H2016 and 1H2017 respectively. This will strengthen MIT's portfolio in the Hi-Tech Building segment.

Investment Action

No stock rating or target price provided, as we do not have coverage on MIT.

Source: Phillip Securities Research - 23 Jul 2015