Frasers Centrepoint Trust

UOBKayhian on 27 Oct 2014

FY15F PE (x): 17.6
FY16F PE (x): 17.6
Hitting new highs. Frasers Centrepoint Trust’s (FCT) 4QFY14 DPU is 2.785 S cents, (-
6.5% yoy, -7.8% qoq) due to the release of retained cash in 3QFY14 and 4QFY13.
Tenant sales up 0.6% yoy while shoppper traffic was down 2% qoq and 3% yoy. FCT
realised 6.5% positive rental reversions for leases signed in the year, resulting in a
small uptick in occupancy costs to 16.4% (from 16%). Management shared that while
segments such as fashion continued to be impacted by online competition and as
Singaporeans travelled abroad to shop, other segments such as F&B remained resilient
and that there is still potential to expand the percentage of F&B in the older malls (eg
Northpoint) from a high single-digit/ low double-digit levels to 20-30% of the mall area.
Maintain BUY with a higher target price of S$2.23 (from S$2.21), based on DDM
(required rate of return: 6.8%, terminal growth: 1.8%).