Downgrade to HOLD.
We downgrade CMT to HOLD on valuation grounds and lackluster DPU growth prospects as most of its eligible portfolio malls have already undergone asset enhancements (little boost to our DDMderived TP).
The remaining known drivers include:
(1) Bugis Junction which will complete its SGD35m AEI (with incremental SGD3.1m NPI per annum) by 3Q14;
(2) Tampines Mall with its SGD36m AEI (with incremental SGD2.9m NPI per annum) by 4Q15; and
(3) the active leasing of Westgate and Westgate Tower (30% stake) in 4Q13 and 4Q14 respectively.
The two AEIs are relatively small with projected increment in capital value (net of capex) of SGD22.1m and SGD16.4m respectively, adding ~3 SG-cts to our RNAV. We are forecasting an unexciting 2.6% DPU CAGR in 2013-2016. Our top pick in this space is Suntec REIT.
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