Posted by maxcore > 2015-08-13 09:47 | Report Abuse

WHy la dei are you dropping now? time to collect?

Posted by Investeye > 2015-10-05 13:50 | Report Abuse

This article first appeared in The Edge Financial Daily, on October 5, 2015.



KUALA LUMPUR: The strong global and domestic headwinds that blasted the third quarter of the year and caused equity markets across the world to tumble have left investors jittery, with not much optimism left.

This may prompt investors to look for defensive stocks. One sector that may appear on the investors’ mind is real estate investment trusts (REITs), which have largely been posting resilient earnings and dividend yields that average some 6%, with some as high as 8%.

However, the REIT sector is not without its own problems. Besides the looming issue of weaker consumer sentiment, both office and retail REITs are facing a glut, a headache that may turn this category into earnings laggards going forward, as competition may push them to lower rentals.

Given all the negativity, are REITs still the safe haven they are purported to be?

It appears so as analysts said the majority of retail REITs have locked in their rental for the next three years, while their office peers usually have leases with 10 to 15 years’ tenure. Thus, earnings visibility is sustainable in the near to mid term.

“I think REITs are still relatively resilient compared to other sectors, as their rentals have been locked in for at least three years,” said RHB Research ( Valuation: 1.65, Fundamental: 1.40) analyst Loong Kok Wen.

She said the weaker consumer sentiment has little impact on REITs’ earnings as the income derived from the tenants’ revenue only makes up a small portion of their numbers.

“On that note, the rental income is sustainable and the downside risk is limited,” she said, though she expects slower growth in rental rate this year.

“Previously, the rental rate grew by 4%-5% a year. That could ease to 3%-4%,” she said, noting it will adversely impact mid-sized malls (500,000 to 600,000 sq ft) that are struggling to retain existing tenants and secure new ones.

“The big malls tend to have better bargaining powers, given their prime locations and high shopper traffic,” she told The Edge Financial Daily.

Echoing her thoughts, MIDF Amanah Research’s analyst Alan Lim sees occupancy rates for bigger shopping malls remaining stable.

“The bigger malls like Mid Valley Megamall, Pavilion Kuala Lumpur and Suria KLCC tend to have a long list of potential tenants. Should existing tenants move out, they can easily replace them with new ones as location still plays a major role in tenants’ decision-making,” he added.

According to a report by the National Property Information Centre, the Klang Valley has 230 shopping complexes offering 60.48 million sq ft of retail space as at the first quarter of 2015.

An estimated 60 million sq ft of new retail space is expected to enter the Greater KL market by 2017, while some 40 new malls will open by 2020. The retail space explosion is anticipated to cause a dilution and limit prime rental growth.

But Sunway Pyramid, the prime earnings driver for Sunway REIT ( Valuation: 1.00, Fundamental: 1.00), is unlikely to be affected as the Sunway Lagoon water theme park nearby draws crowds, according to Hong Leong Investment Bank Research analyst Abdul Hadi Manaf.

As for IGB REIT ( Valuation: 1.65, Fundamental: 2.80), Abdul Hadi said its two flagship malls — Mid Valley Megamall and The Gardens Mall — are performing well, with a 15% rental increase compared with its peers amid the poor market condition, as its tenants are making good profits.

Abdul Hadi said Pavilion REIT ( Valuation: 1.00, Fundamental: 2.80) is fairly stable and has very good quality assets, referring to the Pavilion Kuala Lumpur shopping mall and Pavilion Tower.

“They have a long queue of potential tenants wanting to get in. Hence, I do not see any risks for Pavilion REIT to impose rental reversion every year,” he said.

On Sept 18, Pavilion REIT announced that it is acquiring da:men retail mall from Global Oriental Bhd ( Valuation: 2.10, Fundamental: 2.20) for RM488 million cash, which is targeted to be completed early next year.

Abdul Hadi said post-acquisition, Pavilion REIT’s investment properties will jump from RM4.4 billion to RM4.9 billion while its geographical diversification will be extended to Subang Jaya.

“We remain cautious on the acquisition given plenty of mall supply in surrounding area and da:men has yet to commence operation,” he added.

As for the hotel and office sub-sector, its outlook remains challenging, according to an analyst, who declined to be named.

“The economy is slowing down and corporates are cutting down spending, especially expenditure on conferences and conventions.

“Food and beverages are the bread and butter for the hotel sub sector. With fewer conferences and conventions, REITs will face pressure,” he said.

Posted by speakup > 2015-10-05 13:51 | Report Abuse

dropping coz retail spending decline drastically due to GST and weaker ringgit.

Posted by Ivan89 > 2015-10-27 17:52 | Report Abuse

Dropping due to last correspondence quarter had fair value gain of 85millions. If minus this figure still go up on both revenue and profit.

Posted by Xiao Mi > 2015-12-30 11:02 | Report Abuse

why so active? :)

Posted by Helena > 2015-12-30 14:37 | Report Abuse

you mean "active" ?

Posted by Goodiescat > 2016-01-03 15:39 | Report Abuse

Dividends will issue soon in Jan, another wave of "active" buy. lol. after get dividend, then price falls again.

Posted by Beza > 2016-01-05 16:20 | Report Abuse

So many selling at RM1.31.

Posted by supermix2 > 2016-01-22 11:53 | Report Abuse

Let's see if the coming dividend is more than 4 cents.

Posted by passion2win > 2016-01-26 18:06 | Report Abuse

0.0372

Posted by Choy MH > 2016-01-26 22:22 | Report Abuse

Bad quarter

Posted by Pacific87 > 2016-01-27 10:31 | Report Abuse

not sure why the borrowing cost for 4Q2015 (RM21.8 mil) is much higher than 4Q2014 (RM13.8 mil)? About 58.2% higher.

Posted by Mel2learn > 2016-01-29 12:45 | Report Abuse

hoho up today...

Posted by passion2win > 2016-01-29 13:22 | Report Abuse

quarter result not as good as predict, but price up til record high !

Posted by red_85 > 2016-01-29 13:24 | Report Abuse

becoz undervalue for quite sometimes already...is time to fly..go to midvalley see see then you will have more confident on this reit

Posted by Mel2learn > 2016-01-29 14:25 | Report Abuse

haha when its up. A lot of ppl will comment, what is your TP guys?

Posted by supermix2 > 2016-01-29 17:32 | Report Abuse

I bought it cheap and now it's time for me to reap the rewards.

Posted by Choy MH > 2016-01-29 22:22 | Report Abuse

Better sell now and buy back at 1.30++

Posted by supermix2 > 2016-01-29 22:40 | Report Abuse

Brother Choy MH, it's a good idea as Reits counter never go up so many cents in a single day. Play safe is better.

Posted by red_85 > 2016-01-30 00:01 | Report Abuse

from the news i got, it hardly goes back to 1.3 anymore...fyi

Posted by supermix2 > 2016-01-30 15:02 | Report Abuse

Well, IGBReit had risen quite enough and perhaps it's time to chabut and pick up later?

Posted by moonlove99 > 2016-01-30 21:58 | Report Abuse

how come result not good, the price is up ?

Posted by moonlove99 > 2016-01-30 21:58 | Report Abuse

goreng ?

Posted by supermix2 > 2016-01-31 15:25 | Report Abuse

yes, goreng indeed.

Posted by Xiao Mi > 2016-02-01 13:19 | Report Abuse

can reach 1.5?

Posted by MirageHotelPD > 2016-02-04 19:17 | Report Abuse

Heard unconfirmed news, Midvalley going to increase Car park charges. They have 150,000 car parks and is full during weekends. Just imagine increase RM1 per car. Their income may increase 27 million a year.

Posted by supermix2 > 2016-02-05 04:41 | Report Abuse

Now making good money for me, love it....more please.

Posted by supermix2 > 2016-02-07 02:58 | Report Abuse

So far all the good REITS counters that I am holding are ex and I am still holding this counter & waiting for this one to go ex too, lol.

So far instead of buying a house with that few hundred k ringgit, I am throwing all behind the Reits and save me the hassle to collect rentals & house repairing, etc when I use this money to buy house. Go for it my friends as I had been collecting dividend from some good Reits counters for than 7 years already. So far I am happy indeed with the dividend collected and I do wonder if you would follow the same route that I am taking.

Posted by supermix2 > 2016-02-09 09:56 | Report Abuse

Still going strong with some goreng support.

Posted by Xiao Mi > 2016-02-13 17:57 | Report Abuse

Dividend ex date was 10 Feb, I tot goreng will happen before ex date..but this round goreng still happen after the ex date...

Posted by Ivan89 > 2016-02-16 21:13 | Report Abuse

Tmr t+3

Posted by maxcore > 2016-02-19 10:16 | Report Abuse

weird after dividend price went up..shouldn't it have gone down?..

Posted by Xiao Mi > 2016-02-19 17:48 | Report Abuse

maxcore, I have same feeling too.today touched 1.46!

Posted by Pundit128 > 2016-02-22 09:44 | Report Abuse

Any news for such phenomenon?

Posted by Xiao Mi > 2016-02-23 15:07 | Report Abuse

wa $1.51 !

Posted by supermix2 > 2016-02-24 01:29 | Report Abuse

Higher & higher it goes & I am really happy with the price increase...still holding on for me of more than 100k shares.

Posted by Xiao Mi > 2016-02-29 16:30 | Report Abuse

wow...today will create new high again?

Posted by Ameera > 2016-02-29 19:50 | Report Abuse

Nice... New high!

Posted by Xiao Mi > 2016-03-07 17:13 | Report Abuse

high buy volume!! ..great!!

Posted by bebee > 2016-03-08 16:21 | Report Abuse

time to sell...

Posted by Goodiescat > 2016-03-26 11:35 | Report Abuse

high buy bcoz of baby fair? LOL. congested traffic at mid valley~

Posted by speakup > 2016-04-05 13:56 | Report Abuse

EXPLOSION @ midvalley! some ppl injured!


http://www.theedgemarkets.com/my/article/mid-valley-says-minor-explosions-2-fb-outlets-945am-today-due-lpg-system-reinstatement

http://www.theedgemarkets.com/my/article/mid-valley-says-its-maintenance-staff-lpg-contractor-and-tenant-staff-sustain-minor-injuries

Posted by speakup > 2016-04-05 13:56 | Report Abuse

I see law suits coming! LIMIT DOWN!!!!!

Posted by speakup > 2016-04-05 13:57 | Report Abuse

http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?id=72023&name=EA_GA_ATTACHMENTS

Posted by speakup > 2016-04-05 14:05 | Report Abuse

http://www.thestar.com.my/news/nation/2016/04/05/restaurant-mall-minor-explosion/

Posted by Jason Lim > 2016-04-11 19:15 | Report Abuse

Undeterred at all by the piped gas explosion incident. Strong signs to buy.

Posted by Xiao Mi > 2016-04-11 20:33 | Report Abuse

speakup, limit down mean sell?

Posted by Kkevin2625 > 2016-05-31 23:31 | Report Abuse

why suddenly jump so high? now wondering should / shound'nt let go my stock. about 30% paper profit, should i just let go?

Posted by dividend88 > 2016-06-10 11:53 | Report Abuse

Could be funds like EPF sapu REITS for yield

Posted by batman11 > 2016-06-25 00:12 | Report Abuse

Funds like ASN3, etc also buy REITs as a portfolio diversification strategy.