Mapletree Logistics Trust: Upgrade on recent correction
By Winston Liew
Fri, 26 Oct 2007, 10:00:23 SGT
Mapletree Logistics Trust (MLT) reported a good set of 3Q07 results with revenue growing 11% QoQ to S$39m and distributable income rising 8% QoQ to S$19m. Distributable income per unit (DPU) for the quarter came in at 1.72 cents, +8% QoQ, beating our estimate of 1.50 cents. Growth, like in previous results, came mainly from acquisitions. Since its 2Q07 results MLT has announced four more acquisitions. These assets, together with previously announced acquisitions, will cost a total of S$295m. This means MLT’s asset base will increase from S$2.13b (at 3Q07) to S$2.43b fairly soon. Furthermore, as all the acquisitions are likely to be debt funded, MLT’s gearing will rise to 62%. The implication is that an equity raising exercise is probably on the cards within the next 6 months. Finally since our HOLD downgrade in May, MLT has corrected nicely from S$1.48 to the present S$1.17 or by about 21%. More importantly, its price to book ratio has also come down from over 1.74x in May to a more reasonable 1.39x now. Our previous downgrade was purely on the back of valuation, so in light of the recent correction we are seeing value in MLT. We thus upgrade our rating on MLT from a Hold to BUY and keep our fair value of S$1.50.
Growth again due to acquisitions. Mapletree Logistics Trust (MLT) reported another good set of results. 3Q07 revenue was up over 79% YoY and 11% QoQ at S$38.5m, and distributable income improved 79% YoY and 8% QoQ to S$19.1m. Distributable income per unit (DPU) was in line with sequential bottom-line growth, improving by 30% YoY and 8% QoQ to 1.72 cents. The result is better than OIR's forecast of 1.50 cents. The bulk of the sequential growth came from the acquisition of 9 properties bought over the previous quarter. MLT management indicated that earnings from acquisitions generally lag by about a quarter. In 3Q, only 3 assets were completed so we cannot expect a robust growth in 4Q07. Finally MLT has about 13 properties pending completion worth about S$295m and when completed, its asset value should rise to about S$2.43b from S$2.13b at 3Q07.
Likely penetration of Vietnam and South Korea. Presently MLT's income exposure continues to be Singapore biased. Singapore makes up about 52% (58% in 2Q07) of group NPI, followed by Hong Kong (30%), Japan (13%), Malaysia (3%) and China (2%). Going forward into 2008, we expect MLT to continue to diversify its income and to enter into more new markets. Vietnam is likely to be the next new market followed by South Korea, Vietnam and possibly even India.
Gearing limit to be reached soon. Since its 2Q07 results, MLT has announced 4 more acquisitions. These assets to be acquired will cost a total of S$129m. Together with previously announced acquisitions, MLT has or will be spending a total of S$295m.
The implication is that its asset base will increase from S$2.13b (at 3Q07) to S$2.43b fairly soon. As all the recently announced acquisitions are likely to be debt funded, MLT’s gearing will rise to 62%. The implication is that an equity raising exercise is probably on the cards within the next 6 months.
Upgrade to buy on recent correction. Since our HOLD downgrade in May, MLT has corrected nicely from S$1.48 to the present S$1.19 or by about 20%. More importantly, its price to book ratio has also come down from over 1.74x in May to a more reasonable 1.42x now. Our previous downgrade was purely on the back of valuation, so in light of the recent correction we are seeing value in MLT. We thus upgrade our rating on MLT from a Hold to BUY and keep our fair value of S$1.50.
Showing posts with label Stock: MapletreeLogistics Trust. Show all posts
Showing posts with label Stock: MapletreeLogistics Trust. Show all posts
Friday, October 26, 2007
BT: MLT's Q3 distributable income up 79%
Business Times - 26 Oct 2007
MLT's Q3 distributable income up 79%
The trust's target is to have a portfolio worth at least $5b by 2010
By UMA SHANKARI
MAPLETREE Logistics Trust (MLT) yesterday said its third quarter distributable income rose 78.9 per cent to $19.1 million - from $10.7 million a year ago - as revenue was boosted by contributions from 25 new properties the trust acquired during the year.
Related links:
Click here for MapletreeLog's press release
Financial statement
Presentation slides
MLT's distribution per unit (DPU) came to 1.72 cents, up 30.3 per cent from the DPU of 1.32 cents for the corresponding three months last year.
Net property income increased 76.1 per cent to $33.9 million from $19.2 million.
For the first nine months of the year, MLT's distributable income rose 82 per cent to $52.1 million, while DPU climbed 32.7 per cent to 4.79 cents.
The trust's asset base grew significantly over the last year, adding to its revenue, MLT said.
As at Sept 30, 2007, the trust's portfolio had 61 properties, compared to 36 properties a year ago. These 61 properties have a book value of over $2.1 billion.
Another 13 property acquisitions worth some $295 million in all have also been announced and are pending completion.
'For the current year-to-date, we have completed $687 million of acquisitions and have another $295 million of acquisitions that have been announced but are pending completion,' said Chua Tiow Chye, chief executive of MLT's manager.
'This means that we have achieved 98 per cent of our $1 billion target for 2007.'
Once the pending acquisitions are completed, MLT's portfolio would comprise 74 properties with a book value of about $2.4 billion. The trust's target is to have a portfolio worth at least $5 billion by 2010.
Mr Chua added that MLT will probably buy the 254,000 sq ft Mapletree Logistics Centre in Vietnam from its sponsor Mapletree Investments by the end of this year.
The acquisition will mark the trust's first foray into Vietnam. Right now, all of MLT's properties are in Singapore, Malaysia, Japan, Hong Kong and China, but the trust has also identified Vietnam, India, South Korea, Taiwan and Thailand as attractive markets as it aims to have a more geographically diversified portfolio.
'We hope that by this time next year, we will have some assets in Thailand and South Korea,' said Richard Lai, deputy chief executive of MLT's manager.
For the next financial year, more contributions from Japan, China and Malaysia are expected, MLT said.
MLT's shares closed two cents up at $1.19 yesterday.
MLT's Q3 distributable income up 79%
The trust's target is to have a portfolio worth at least $5b by 2010
By UMA SHANKARI
MAPLETREE Logistics Trust (MLT) yesterday said its third quarter distributable income rose 78.9 per cent to $19.1 million - from $10.7 million a year ago - as revenue was boosted by contributions from 25 new properties the trust acquired during the year.
Related links:
Click here for MapletreeLog's press release
Financial statement
Presentation slides
MLT's distribution per unit (DPU) came to 1.72 cents, up 30.3 per cent from the DPU of 1.32 cents for the corresponding three months last year.
Net property income increased 76.1 per cent to $33.9 million from $19.2 million.
For the first nine months of the year, MLT's distributable income rose 82 per cent to $52.1 million, while DPU climbed 32.7 per cent to 4.79 cents.
The trust's asset base grew significantly over the last year, adding to its revenue, MLT said.
As at Sept 30, 2007, the trust's portfolio had 61 properties, compared to 36 properties a year ago. These 61 properties have a book value of over $2.1 billion.
Another 13 property acquisitions worth some $295 million in all have also been announced and are pending completion.
'For the current year-to-date, we have completed $687 million of acquisitions and have another $295 million of acquisitions that have been announced but are pending completion,' said Chua Tiow Chye, chief executive of MLT's manager.
'This means that we have achieved 98 per cent of our $1 billion target for 2007.'
Once the pending acquisitions are completed, MLT's portfolio would comprise 74 properties with a book value of about $2.4 billion. The trust's target is to have a portfolio worth at least $5 billion by 2010.
Mr Chua added that MLT will probably buy the 254,000 sq ft Mapletree Logistics Centre in Vietnam from its sponsor Mapletree Investments by the end of this year.
The acquisition will mark the trust's first foray into Vietnam. Right now, all of MLT's properties are in Singapore, Malaysia, Japan, Hong Kong and China, but the trust has also identified Vietnam, India, South Korea, Taiwan and Thailand as attractive markets as it aims to have a more geographically diversified portfolio.
'We hope that by this time next year, we will have some assets in Thailand and South Korea,' said Richard Lai, deputy chief executive of MLT's manager.
For the next financial year, more contributions from Japan, China and Malaysia are expected, MLT said.
MLT's shares closed two cents up at $1.19 yesterday.
Thursday, October 25, 2007
CIMB: Singapore's Mapletree Logistics Trust TP raised to 1.65 sgd
Singapore's Mapletree Logistics Trust target price raised to 1.65 sgd - CIMB-GK
10/25/2007 3:25:00 PM
SINGAPORE (Thomson Financial) - CIMB-GK Research on Thursday lifted its target price for Mapletree Logistics Trust to 1.65 Singapore dollars from 1.43 dollars after upgrading its distribution per unit (DPU) forecast for the Singapore-based industrial real estate investment trust (REIT).
"In view of higher distributable income expectations for second half 2007 with more completed properties, we have increased our DPU forecasts for 2007-2009 by 10-13 percent," CIMB-GK said in a note to clients.
The REIT will release its third-quarter results after market closes today and CIMB-GK is expecting it to report distributable income of 20 million dollars, up 87 percent from a year earlier, supported by the acquisitions of 32 properties worth 883 million dollars so far this year.
DPU for the quarter should reach 6.4 cents, 10 percent more than the initial estimate of 5.8 cents, said CIMB-GK which is keeping an "outperform" rating on the REIT.
At 3.22 pm, Mapletree was up 1 cent or 0.9 percent at 1.18 Singapore dollars with 1.6 million shares traded.
(1 US dollar = 1.46 Singapore dollars)
yuinmunn.szetoh@thomson.com
10/25/2007 3:25:00 PM
SINGAPORE (Thomson Financial) - CIMB-GK Research on Thursday lifted its target price for Mapletree Logistics Trust to 1.65 Singapore dollars from 1.43 dollars after upgrading its distribution per unit (DPU) forecast for the Singapore-based industrial real estate investment trust (REIT).
"In view of higher distributable income expectations for second half 2007 with more completed properties, we have increased our DPU forecasts for 2007-2009 by 10-13 percent," CIMB-GK said in a note to clients.
The REIT will release its third-quarter results after market closes today and CIMB-GK is expecting it to report distributable income of 20 million dollars, up 87 percent from a year earlier, supported by the acquisitions of 32 properties worth 883 million dollars so far this year.
DPU for the quarter should reach 6.4 cents, 10 percent more than the initial estimate of 5.8 cents, said CIMB-GK which is keeping an "outperform" rating on the REIT.
At 3.22 pm, Mapletree was up 1 cent or 0.9 percent at 1.18 Singapore dollars with 1.6 million shares traded.
(1 US dollar = 1.46 Singapore dollars)
yuinmunn.szetoh@thomson.com
Wednesday, October 24, 2007
DBS: Mapletree Logistics Trust TP$1.59
Mapletree Logistics Trust DBS @ S$1.22 (09 Oct 2007)
- Buy S$1.22 STI : 3,820.31
- Price Target : 12-Month S$1.59
- Reason for Report : Post roadshow update
- Potential Catalyst: Strong acquisition pipeline
- ANALYST: Zy Sew Ho +65 6398 7961
- zysew@dbsvickers.com
- Major Shareholders: Meranti Investments (%) 15.2, Mapletree Logistics (%) 7.4, Mangrove Pte Ltd (%) 7.4
- Free Float (%) 70.0
- Mkt. Cap (S$m/US$m) 1,352 / 918
- Earnings Rev (%): 2008: - 2009: -
- Consensus EPS (S cts): 2008: 6.8 2009: 7.2
- Variance vs Cons (%): 2008: (2.9) 2009: -
- Sector : REITS
- Principal Business: Real estate investment trust with a portfolio of 73 properties in the logistics sector.
- Updates from roadshow - Story: Mapletree Logistics Trust (MLT) was on a roadshow with us to Hong Kong and Europe for the period 24 to 28 Sep 07.
- Point: Investors like MLT’s growth strategy and plans to penetrate into emerging markets such as Vietnam and India. During the discussions, the management also addressed general concerns raised, which include the rationale for expansion into Japan (where the rental escalation and yields are not attractive), financing issues in the face of credit crunch and high gearing ratio.
- Relevance: We continue to like MLT for its strong acquisition pipeline and pan-Asian platform. Maintain Buy with target price of S$1.59 based on DCF Valuation. - Pipeline from the Sponsor. A visible pipeline of 10 development projects (six in China, one in Malaysia and three in Vietnam) worth a total of S$846m is expected to come from the Sponsor. Construction of the Yangshan Bonded Logistics Park, China (approximately S$37m) and Mapletree Logistics Centre, Vietnam (approximately S$10m) are completed and these two properties are expected to be injected into MLT’s portfolio within the next six months. Moving forward, 10-20% of the annual target of S$1bn is expected to come from the Sponsor while the remaining pipeline will come from third-party acquisitions.
- Growth strategy. MLT’s strong acquisitions have been driving its growth and to date, it has a total portfolio of 74 properties worth S$2.4bn. The pipeline from China, Vietnam and India are expected to come from the Sponsor (who will undertake the Greenfield developments), as ready assets are not readily available for acquisitions. The Sponsor currently has a pipeline of six and three development projects in China and Vietnam respectively. However, as the Sponsor has no development projects in India, we could only expect the assets from India to be included in MLT’s portfolio from 2009. In 2008, we expect MLT to grow its Tier 1 assets (i.e. Singapore, Hong Kong and Japan) by making another S$500-S$600m worth of acquisitions while the remainder of its S$1bn target will come from its Tier 2 markets (i.e. China, Malaysia and Vietnam).
- Key concerns raised include (i) Japan market : Although the industrial properties in Japan offer a lower yield, MLT has entered into swap contracts (from Japanese yen to Singapore dollars) which will lead to a yield pick-up of around 100 to 150bps. In addition, Japan assets which have long leases will complement its shorter term leases in its portfolio in higher growth markets such as China, Malaysia and Hong Kong; (ii) Financing issues : As at 30 Jun 07, around 55% of MLT’s total current borrowings has been hedged and the management expects this hedging rate to increase. With regards to the recent credit crunch, MLT has not faced any issues given the company’s strong credibility. (iii) High gearing of 54% as of 30 Jun 07 : In order to provide for another S$1bn targeted acquisitions in 2008, there is a possibility of an equity fund raising exercise.
- Buy S$1.22 STI : 3,820.31
- Price Target : 12-Month S$1.59
- Reason for Report : Post roadshow update
- Potential Catalyst: Strong acquisition pipeline
- ANALYST: Zy Sew Ho +65 6398 7961
- zysew@dbsvickers.com
- Major Shareholders: Meranti Investments (%) 15.2, Mapletree Logistics (%) 7.4, Mangrove Pte Ltd (%) 7.4
- Free Float (%) 70.0
- Mkt. Cap (S$m/US$m) 1,352 / 918
- Earnings Rev (%): 2008: - 2009: -
- Consensus EPS (S cts): 2008: 6.8 2009: 7.2
- Variance vs Cons (%): 2008: (2.9) 2009: -
- Sector : REITS
- Principal Business: Real estate investment trust with a portfolio of 73 properties in the logistics sector.
- Updates from roadshow - Story: Mapletree Logistics Trust (MLT) was on a roadshow with us to Hong Kong and Europe for the period 24 to 28 Sep 07.
- Point: Investors like MLT’s growth strategy and plans to penetrate into emerging markets such as Vietnam and India. During the discussions, the management also addressed general concerns raised, which include the rationale for expansion into Japan (where the rental escalation and yields are not attractive), financing issues in the face of credit crunch and high gearing ratio.
- Relevance: We continue to like MLT for its strong acquisition pipeline and pan-Asian platform. Maintain Buy with target price of S$1.59 based on DCF Valuation. - Pipeline from the Sponsor. A visible pipeline of 10 development projects (six in China, one in Malaysia and three in Vietnam) worth a total of S$846m is expected to come from the Sponsor. Construction of the Yangshan Bonded Logistics Park, China (approximately S$37m) and Mapletree Logistics Centre, Vietnam (approximately S$10m) are completed and these two properties are expected to be injected into MLT’s portfolio within the next six months. Moving forward, 10-20% of the annual target of S$1bn is expected to come from the Sponsor while the remaining pipeline will come from third-party acquisitions.
- Growth strategy. MLT’s strong acquisitions have been driving its growth and to date, it has a total portfolio of 74 properties worth S$2.4bn. The pipeline from China, Vietnam and India are expected to come from the Sponsor (who will undertake the Greenfield developments), as ready assets are not readily available for acquisitions. The Sponsor currently has a pipeline of six and three development projects in China and Vietnam respectively. However, as the Sponsor has no development projects in India, we could only expect the assets from India to be included in MLT’s portfolio from 2009. In 2008, we expect MLT to grow its Tier 1 assets (i.e. Singapore, Hong Kong and Japan) by making another S$500-S$600m worth of acquisitions while the remainder of its S$1bn target will come from its Tier 2 markets (i.e. China, Malaysia and Vietnam).
- Key concerns raised include (i) Japan market : Although the industrial properties in Japan offer a lower yield, MLT has entered into swap contracts (from Japanese yen to Singapore dollars) which will lead to a yield pick-up of around 100 to 150bps. In addition, Japan assets which have long leases will complement its shorter term leases in its portfolio in higher growth markets such as China, Malaysia and Hong Kong; (ii) Financing issues : As at 30 Jun 07, around 55% of MLT’s total current borrowings has been hedged and the management expects this hedging rate to increase. With regards to the recent credit crunch, MLT has not faced any issues given the company’s strong credibility. (iii) High gearing of 54% as of 30 Jun 07 : In order to provide for another S$1bn targeted acquisitions in 2008, there is a possibility of an equity fund raising exercise.
DBS: Mapletree Logistics Trust TP $1.46
Mapletree Logistics Trust DBS @ S$1.16 (19 Sep 2007)
- BUY S$1.16 STI : 3,477.75
- Price Target : 12-Month S$ 1.46
- Reason for Report : Company Update
- Potential Catalyst: Acquisitions in the pipeline
- Major Shareholders - Meranti Investments (%) 15.2, Mapletree Logistics (%) 7.4, Mangrove Pte Ltd (%) 7.4
- Free Float (%) 70.0
- Analyst - Zy Sew Ho +65 6398 7961
- zysew@dbsvickers.com
- Earnings Rev (%): 2007: - 2008: -
- Consensus EPS (S cts): 2007: 5.9 2008: 6.1
- Variance vs Cons (%): 2007: 5.1 2008: (1.6)
- Sector : REITS
- Principal Business: Real estate investment trust with a portfolio of 18 properties mostly in the logistics sector.
- Expanding its footprint in Asia
- Recent updates. Since our last report, MLT announced the acquisition of five warehouse properties in Singapore for a total consideration of S$47.2m. This will bring MLT’s total portfolio to 72 properties with a total portfolio size of S$2.3bn (includes properties pending completion). Given a target acquisition of S$1bn pa in FY07, MLT is on track to reach its target of S$2.4bn by year-end. Of note, 10-20% of the annual target acquisition pipeline of S$1bn will come from the Sponsor’s properties while the remaining will be from third parties.
- Visible pipeline from Sponsor. The Sponsor, Mapletree Investments, has a pipeline of developments in Vietnam, China and Malaysia worth a total of approximately S$315.0m. First on the plate is the multitenanted logistics and warehousing facility (VSIP I) in Vietnam.
Construction was completed in Jan 07 and once it is fully leased, MLT is expected to acquire this property by end 2007. Together with another logistics park, VSIP II of which construction is expected to commence in 3Q07, the total combined estimated value of VSIP I and VSIP II is S$165m.
- Venturing into new markets. Moving forward, MLT expects contribution from the emerging markets to make up of 25% of its asset value while the core markets (i.e. Singapore, Japan and Hong Kong) will make up 75% of asset value. MLT is looking to expand its presence in China and Malaysia and also to venture into Vietnam with the first property expected to be acquired in 2H07. More growth will be expected from the emerging markets in the medium term. In the medium to long term, MLT will also be exploring emerging markets such as South Korea, India, Thailand and Taiwan.
- Debt headroom. As at 30 Jun 07, MLT has a gearing of 54% with a debt headroom of around S$300m. Given that MLT has targeted to increase its portfolio of assets to S$5bn by 2010, the possibility of an equity raising exercise is high.
- Maintain Buy with target price of S$1.46. With the recent weakness in the stock price, MLT is trading at an attractive current yield of 5.1%. We are reiterating our Buy recommendation with target price of S$1.46 based on DCF valuation (assumed acquisitions of S$1bn p.a. from 2007 to 2009).
- BUY S$1.16 STI : 3,477.75
- Price Target : 12-Month S$ 1.46
- Reason for Report : Company Update
- Potential Catalyst: Acquisitions in the pipeline
- Major Shareholders - Meranti Investments (%) 15.2, Mapletree Logistics (%) 7.4, Mangrove Pte Ltd (%) 7.4
- Free Float (%) 70.0
- Analyst - Zy Sew Ho +65 6398 7961
- zysew@dbsvickers.com
- Earnings Rev (%): 2007: - 2008: -
- Consensus EPS (S cts): 2007: 5.9 2008: 6.1
- Variance vs Cons (%): 2007: 5.1 2008: (1.6)
- Sector : REITS
- Principal Business: Real estate investment trust with a portfolio of 18 properties mostly in the logistics sector.
- Expanding its footprint in Asia
- Recent updates. Since our last report, MLT announced the acquisition of five warehouse properties in Singapore for a total consideration of S$47.2m. This will bring MLT’s total portfolio to 72 properties with a total portfolio size of S$2.3bn (includes properties pending completion). Given a target acquisition of S$1bn pa in FY07, MLT is on track to reach its target of S$2.4bn by year-end. Of note, 10-20% of the annual target acquisition pipeline of S$1bn will come from the Sponsor’s properties while the remaining will be from third parties.
- Visible pipeline from Sponsor. The Sponsor, Mapletree Investments, has a pipeline of developments in Vietnam, China and Malaysia worth a total of approximately S$315.0m. First on the plate is the multitenanted logistics and warehousing facility (VSIP I) in Vietnam.
Construction was completed in Jan 07 and once it is fully leased, MLT is expected to acquire this property by end 2007. Together with another logistics park, VSIP II of which construction is expected to commence in 3Q07, the total combined estimated value of VSIP I and VSIP II is S$165m.
- Venturing into new markets. Moving forward, MLT expects contribution from the emerging markets to make up of 25% of its asset value while the core markets (i.e. Singapore, Japan and Hong Kong) will make up 75% of asset value. MLT is looking to expand its presence in China and Malaysia and also to venture into Vietnam with the first property expected to be acquired in 2H07. More growth will be expected from the emerging markets in the medium term. In the medium to long term, MLT will also be exploring emerging markets such as South Korea, India, Thailand and Taiwan.
- Debt headroom. As at 30 Jun 07, MLT has a gearing of 54% with a debt headroom of around S$300m. Given that MLT has targeted to increase its portfolio of assets to S$5bn by 2010, the possibility of an equity raising exercise is high.
- Maintain Buy with target price of S$1.46. With the recent weakness in the stock price, MLT is trading at an attractive current yield of 5.1%. We are reiterating our Buy recommendation with target price of S$1.46 based on DCF valuation (assumed acquisitions of S$1bn p.a. from 2007 to 2009).
BT: Mapletree all set to take on the big boys
Business Times - 24 Oct 2007
COMMENTARY
Mapletree all set to take on the big boys
With mouthwatering results and growing sophistication, it's come a long way since 2000
By UMA SHANKARI
LISTED developers in Singapore now have a relatively new kid on the block to watch out for - Temasek-owned Mapletree Investments.
Under the stewardship of Hiew Yoon Khong, who took over the helm in August 2003, Mapletree has expanded its overseas presence and grown its capital management business.
And this year, the company has started going head-to-head with established developers to compete for land sites.
Mapletree's strategy has translated into solid financial numbers.
During its 2006 financial year, Mapletree's earnings crossed the billion-dollar mark for the first time - a milestone achieved by only one other property company in Singapore, CapitaLand.
Mapletree's net profit came to $1.07 billion, a seven-fold increase over the previous year.
While the bulk of the earnings spike was due to valuation gains from its newly-opened mega-mall VivoCity, operating revenue itself grew by 35 per cent to $216.6 million.
During the year, Mapletree's asset portfolio also grew from $2.97 billion to $4.53 billion.
But more significant than the improved numbers is the fact that over the last few years, Mapletree has become a much more sophisticated entity.
Mr Hiew told BT that going forward, Mapletree will continue to grow its capital management business and overseas footprint - in line with what other developers in Singapore are doing.
Big but nimble
Growing the capital management business will also allow Mapletree to go asset-light, which will allow it to move more quickly and take on bigger projects.
For example, setting up the commercial trust, which will have a portfolio of $3 billion to $3.5 billion, means that Mapletree will be able to recycle assets worth that amount, said Mr Hiew. It is quite clear that he intends to put the money to good use. Mapletree has signalled this year that it is more than just a holding company for state-owned properties by bidding for and winning a government land sales site at Anson Road/Enggor Street in July.
Mapletree's offer was a bullish 23 per cent higher than the next highest offer - a clear sign that the company is serious about building up its commercial landbank.
Last month, Mapletree also formed a joint venture with CapitaLand to offer $1.8 billion - or $1,281 per square foot per plot ratio - for a white site at Marina Bay, but lost out to Macquarie Global Property Advisors.
With the bulk of its commercial properties divested into the upcoming trust, a flush-with-cash Mapletree will no doubt be a serious contender for sites.
Mr Hiew said that he wants to grow Mapletree's exposure to the office sector in Singapore in particular.
The company has certainly come a long way since it was incorporated in December 2000 to hold the property assets transferred by PSA to Temasek Holdings.
Going forward, it will be interesting to watch Mapletree make its mark on the property landscape as it comes into its own over the next few years.
COMMENTARY
Mapletree all set to take on the big boys
With mouthwatering results and growing sophistication, it's come a long way since 2000
By UMA SHANKARI
LISTED developers in Singapore now have a relatively new kid on the block to watch out for - Temasek-owned Mapletree Investments.
Under the stewardship of Hiew Yoon Khong, who took over the helm in August 2003, Mapletree has expanded its overseas presence and grown its capital management business.
And this year, the company has started going head-to-head with established developers to compete for land sites.
Mapletree's strategy has translated into solid financial numbers.
During its 2006 financial year, Mapletree's earnings crossed the billion-dollar mark for the first time - a milestone achieved by only one other property company in Singapore, CapitaLand.
Mapletree's net profit came to $1.07 billion, a seven-fold increase over the previous year.
While the bulk of the earnings spike was due to valuation gains from its newly-opened mega-mall VivoCity, operating revenue itself grew by 35 per cent to $216.6 million.
During the year, Mapletree's asset portfolio also grew from $2.97 billion to $4.53 billion.
But more significant than the improved numbers is the fact that over the last few years, Mapletree has become a much more sophisticated entity.
Mr Hiew told BT that going forward, Mapletree will continue to grow its capital management business and overseas footprint - in line with what other developers in Singapore are doing.
Big but nimble
Growing the capital management business will also allow Mapletree to go asset-light, which will allow it to move more quickly and take on bigger projects.
For example, setting up the commercial trust, which will have a portfolio of $3 billion to $3.5 billion, means that Mapletree will be able to recycle assets worth that amount, said Mr Hiew. It is quite clear that he intends to put the money to good use. Mapletree has signalled this year that it is more than just a holding company for state-owned properties by bidding for and winning a government land sales site at Anson Road/Enggor Street in July.
Mapletree's offer was a bullish 23 per cent higher than the next highest offer - a clear sign that the company is serious about building up its commercial landbank.
Last month, Mapletree also formed a joint venture with CapitaLand to offer $1.8 billion - or $1,281 per square foot per plot ratio - for a white site at Marina Bay, but lost out to Macquarie Global Property Advisors.
With the bulk of its commercial properties divested into the upcoming trust, a flush-with-cash Mapletree will no doubt be a serious contender for sites.
Mr Hiew said that he wants to grow Mapletree's exposure to the office sector in Singapore in particular.
The company has certainly come a long way since it was incorporated in December 2000 to hold the property assets transferred by PSA to Temasek Holdings.
Going forward, it will be interesting to watch Mapletree make its mark on the property landscape as it comes into its own over the next few years.
BT: Mapletree plans to list Reits, snap up new assets
Note: Mainboard listed in July 2005. At $1.2, DPU yield at 4.2% (based on 2006 total DPU paidout of 5.05cents) or 4.7% (based on MLT forecast of 5.69cents in FY07). Not so bad. It is quite a good defensive stock with potential share price appreciation.
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Business Times - 24 Oct 2007
Mapletree plans to list Reits, snap up new assets
Commercial trust may include VivoCity; company eyes big growth overseas
By UMA SHANKARI
(SINGAPORE) Mapletree Investments intends to list a commercial trust with a $3-$3.5 billion portfolio in the next six months as it moves to grow its fee income and expand its footprint overseas, says chief executive Hiew Yoon Khong.
'Over the next four years we want to scale up our capital management business by being very active in key markets,' he told The Business Times in a recent interview.
Besides Singapore, the company is looking at China, India and Vietnam for acquisitions. And in the slightly longer term it is also interested in Taiwan, South Korea and Thailand - particularly their logistics and industrial sectors.
The plan is to bump up revenue from fee income to 50 per cent of overall revenue in the next three to five years - from just 9 per cent in Mapletree's last financial year.
To grow the capital management business, the company has opted to look abroad. Right now only about 20 per cent of its portfolio is outside Singapore. But Mr Hiew said the proportion could be as high as 80 per cent in five years.
'As a group, we hope to be able to break into one or two new markets a year,' he said. The greatest opportunities, he believes, are in China, where Mapletree is now looking at second-tier cities. First-tier cities are 'too crowded and the values are too high,' he said.
In particular, Mapletree is trying to expand its commercial presence in Singapore and the region.
'People know us as a logistics player, but as a company we are a lot more than that,' Mr Hiew said. 'Looking forward, we will be bidding for land to do development work. In Singapore, we are keen to have a bit more exposure to the office sector in particular.'
One way to do this is through the upcoming commercial trust - which the market has been waiting for.
The trust will likely contain VivoCity - Mapletree's largest asset, with a book value of about $1.6 billion - as well as other commercial properties including office buildings Harbourfront Centre and PSA Building and nightspot St James Power Station, Mr Hiew said.
Mapletree is already lining up a pipeline of assets for the trust. In a break from tradition, the company this year started bidding for commercial land sites in Singapore.
In July it won a government land sales site at Anson Road/Enggor Street in a public tender that drew other big names such as CapitaLand and Keppel Land. Mapletree's offer was 23 per cent higher than the next highest bid.
In addition, Mapletree is likely to launch a Reit based on assets in India, with its Indian property development partner Embassy Group, by the first half of 2008.
Market talk of Embassy's Reit, which will be managed through a joint-venture partnership between Embassy and Mapletree, has been around since early this year. Mr Hiew confirmed plans for the Reit.
'We will probably hold some sort of equity stake in the trust but that is not finalised yet,' he said.
Mapletree has also secured a deal to co-manage the Lippo Group's Indonesia-focused retail Reit. The prospectus for this Reit was lodged with the Monetary Authority of Singapore (MAS) last Friday.
Mr Hiew is also committed to growing Mapletree's private equity franchises. For example, the company - together with its partner CIMB - will be launching its second Malaysia fund in the next six months.
Mapletree's growing portfolio in Singapore and overseas will serve as an asset pipeline for both the existing Mapletree Logistics Trust and the new commercial trust, as well as any funds the company might set up in future.
'We are very keen to support the growth of our Reits and fund business,' Mr Hiew said.
With its asset-light strategy in place, the company will now be able to take on bigger projects and move faster on them.
Right now, assets under management stand at $2.2 billion, while Mapletree owns a further $4.8 billion of assets. Mr Hiew's aim is to grow by $1 billion or so each year.
'Four years ago we mapped out strategic initiatives for the company to enhance our value,' he said. 'When we review the programme now, we are happy with the progress to date but will look to scale up these businesses much more.'
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Business Times - 24 Oct 2007
Mapletree plans to list Reits, snap up new assets
Commercial trust may include VivoCity; company eyes big growth overseas
By UMA SHANKARI
(SINGAPORE) Mapletree Investments intends to list a commercial trust with a $3-$3.5 billion portfolio in the next six months as it moves to grow its fee income and expand its footprint overseas, says chief executive Hiew Yoon Khong.
'Over the next four years we want to scale up our capital management business by being very active in key markets,' he told The Business Times in a recent interview.
Besides Singapore, the company is looking at China, India and Vietnam for acquisitions. And in the slightly longer term it is also interested in Taiwan, South Korea and Thailand - particularly their logistics and industrial sectors.
The plan is to bump up revenue from fee income to 50 per cent of overall revenue in the next three to five years - from just 9 per cent in Mapletree's last financial year.
To grow the capital management business, the company has opted to look abroad. Right now only about 20 per cent of its portfolio is outside Singapore. But Mr Hiew said the proportion could be as high as 80 per cent in five years.
'As a group, we hope to be able to break into one or two new markets a year,' he said. The greatest opportunities, he believes, are in China, where Mapletree is now looking at second-tier cities. First-tier cities are 'too crowded and the values are too high,' he said.
In particular, Mapletree is trying to expand its commercial presence in Singapore and the region.
'People know us as a logistics player, but as a company we are a lot more than that,' Mr Hiew said. 'Looking forward, we will be bidding for land to do development work. In Singapore, we are keen to have a bit more exposure to the office sector in particular.'
One way to do this is through the upcoming commercial trust - which the market has been waiting for.
The trust will likely contain VivoCity - Mapletree's largest asset, with a book value of about $1.6 billion - as well as other commercial properties including office buildings Harbourfront Centre and PSA Building and nightspot St James Power Station, Mr Hiew said.
Mapletree is already lining up a pipeline of assets for the trust. In a break from tradition, the company this year started bidding for commercial land sites in Singapore.
In July it won a government land sales site at Anson Road/Enggor Street in a public tender that drew other big names such as CapitaLand and Keppel Land. Mapletree's offer was 23 per cent higher than the next highest bid.
In addition, Mapletree is likely to launch a Reit based on assets in India, with its Indian property development partner Embassy Group, by the first half of 2008.
Market talk of Embassy's Reit, which will be managed through a joint-venture partnership between Embassy and Mapletree, has been around since early this year. Mr Hiew confirmed plans for the Reit.
'We will probably hold some sort of equity stake in the trust but that is not finalised yet,' he said.
Mapletree has also secured a deal to co-manage the Lippo Group's Indonesia-focused retail Reit. The prospectus for this Reit was lodged with the Monetary Authority of Singapore (MAS) last Friday.
Mr Hiew is also committed to growing Mapletree's private equity franchises. For example, the company - together with its partner CIMB - will be launching its second Malaysia fund in the next six months.
Mapletree's growing portfolio in Singapore and overseas will serve as an asset pipeline for both the existing Mapletree Logistics Trust and the new commercial trust, as well as any funds the company might set up in future.
'We are very keen to support the growth of our Reits and fund business,' Mr Hiew said.
With its asset-light strategy in place, the company will now be able to take on bigger projects and move faster on them.
Right now, assets under management stand at $2.2 billion, while Mapletree owns a further $4.8 billion of assets. Mr Hiew's aim is to grow by $1 billion or so each year.
'Four years ago we mapped out strategic initiatives for the company to enhance our value,' he said. 'When we review the programme now, we are happy with the progress to date but will look to scale up these businesses much more.'
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