Mapletree Commercial Trust (SGX:N2IU)’s revenue and NPI eased q-o-q in 1Q22, as VivoCity’s operating metrics softened due to reinstatement of COVID-19 measures in Singapore, even as it delivered stronger y-o-y comparisons. The results were operationally in line with both consensus and our estimates and we maintain our forecasts and S$2.35 DDM-based target price (COE: 5.9%, 2.0%) for Mapletree Commercial Trust.
Mapletree Commercial Trust's balance sheet remains strong with an estimated S$01.0-1.8b debt headroom (at 40-45% limit). Valuations are undemanding at 4.5% dividend yield, with improved DPU visibility after its MBC II acquisition, and added traction from VivoCity’s recovery into the coming quarters.
Lower Rebates, Stronger Y-o-y Comps
Mapletree Commercial Trust's 1Q22 revenue jumped 23.7% but dipped 4.7% q-o-q, while NPI increased by 22.9% y-o-y and fell 4.2% q-o-q, as:
rental rebates at 0.6 months of fixed rents were significantly lower than in 1Q21; and
compensation received from a pre-terminated lease at mTower bolstered a 7.6% y-o-y/ 7.7% y-o-y growth in revenue/ NPI for its office/business park assets.
As a result, portfolio occupancy was lower at 92.6% as of end-Jun 2021, from 93.5% in 4Q21, even as it rose at MBC (from 94.2% to 96.6%) and VivoCity (97.1% to 99.4%), with Mapletree Anson at 99.2% and MLHF fully committed.
Less Downtime at VivoCity, Stronger in 2H22
Revenue/ NPI at VivoCity jumped 77.6% y-o-y/ 80.7% y-o-y but fell 21.1% q-o-q/ 20.4% q-o-q, as Frasers Centrepoint Trust (SGX:J69U) (with footfall at 53-65% and tenant sales at 84-91% in 2Q21) due to limitations on large-scale sales events, but with upside seen from further easing in capacities in 2H22.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....