- We re-affirm our HOLD recommendation on CapitaMalls
Malaysia Trust (CMMT), with a higher fair value of RM2.00/unit vs. RM 1.68/unit
previously, based on our DCF valuation, as we roll forward our valuation to FY13F.
- CMMT reported a realised net profit of RM37mil for 4QFY12,
which brought full-year FY12 net profit to RM149mil. The results were in-line with
our, and consensus, estimates. A DPU of 2.11 sen was declared for 4Q. All in,
the group achieved DPU of 8.44 sen (+7.2% YoY) and dividend yield of 4.5% for
FY12.
- FY12’s realised income increased by 26% YoY on the back of
25% rise in revenue. Full-year contribution of East Coast Mall and completion
of asset enhancement initiatives (AEI) at Gurney Plaza had driven the 20% YoY
increase in net property income (NPI). A RM15m revaluation gain was recorded
for the quarter, bringing the total portfolio size to RM2.9bil.
- Gurney Plaza’s AEI, particularly the revenue-generating
AEI, was completed at end-FY12, adding 4,450sf NLA to the basement and ground
floor. Meanwhile, the mall’s NPI margin fell to 68.1% from 71.3% as the group
embarked on selling electricity in early
2012. CMMT sells electricity to tenants and acts as the intermediary by buying
from TNB at a lower rate. No change in price paid by tenants. Given that the
low margins from this business, this has resulted in a slight fall to overall
NPI margins. Moving forward, CMMT intends to introduce this on-selling of
electricity to other malls.
- Furthermore, major upgrading work on the 35 year-old
Sungei Wang Plaza is to complete by end-FY13F, with the group’s one-off capex
of RM17.6mil. We expect improvement in rentals post-refurbishment. Note that
rental reversion was flat at 0% for FY12. Conversely, other CMMT portfolio
reported positive rental reversions at a healthy +6.4% overall.
- We believe there is potential rental upside in the East
Coast Mall, given that the average rental is fairly low at circa RM6psf.
Pending approvals from relevant authorities, the plan is to convert the carpark
opposite the mall into additional retail space (+23% NLA), which could be ready
in 2 years.
- We forecast growth of between 5%-6% in earnings for
FY13F-FY15F and introduce our FY15F earnings. Our model assumes a 100% distribution
ratio. Projected dividend yield of 4.7% and 5% for FY13F and FY14F,
respectively – on parity to Pavilion REIT (PREIT Mk Equity, BUY).
- CMMT is backed by a strong sponsor, CapitaMalls Asia
(CMA). We like CMMT for its well-diversified portfolio mix and resilient income
stream. Assets in the pipeline include Queensbay Mall in Penang. Despite the
lack of asset injection in the immediate-to near-term, CMA is developing a
retail mall in Taman Melawati with Sime Darby. Any potential acquisition will
continue to focus on day-to-day necessity shopping – in line with CMMT’s
current portfolio of assets.
Source: AmeSecurities
No comments:
Post a Comment