CDL Hospitality Trusts' (CDLHT) results were in line with expectations. 2Q17 gross revenue increased 12.7% to S$47.8m, boosted by the inorganic contribution from The Lowry Hotel, which was acquired on 4 May 2017, as well as stronger contributions from the New Zealand hotel. Correspondingly, total distribution to Stapled Security holders increased 12.6% to S$24.9m.

2Q17 DPU dropped 3.7% YoY to 2.08 S cents or 22.8% of our full-year forecast. 1H17 DPU came to 4.10 S cents or 44.9% of our fullyear forecast.

2H17 is expected to contribute more to the full-year DPU given the inorganic contributions from the Lowry Hotel acquisition and Pullman Hotel Munich. CDLHT's Singapore RevPAR dipped by 1.4% YoY.

For now, we place our Hold rating and fair value of S$1.48 under review pending further details.

Source: OCBC Research - 28 Jul 2017