120604 大整合

Singapore
Sector Update
4 June 2012
Co. Reg No: 198700034E MICA (P) : 099/03/2012
Singapore REITs
Take Our Pristine Picks
ONG Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470 Wilson LIEW wilsonliew@maybank-ke.com.sg (65) 6432 1454 Track record matters. The myth that S-REITs are good incomeyielding instruments for retail investors has generated much debate. On the one hand, REITs proponents like the recurring distributions paid out from steady streams of rental income. On the other hand, naysayers argue that whatever REITs managers pay out in dividends, they will likely take back in the form of rights issues. We examined the total rate of return of the 10 largest S-REITs since their listing, namely, those with a trading history of at least five years, and put forward our pristine picks to ride through the impending economic down cycle. Industrial and retail REITs top of the league. REITS in the more resilient subsectors like industrial and retail topped our league table, with CDL Hospitality Trusts, Frasers Centrepoint Trust and Ascendas Real Estate Investment Trust the best performers. K-REIT Asia was the worst performer, given the numerous equity cash calls it made to fund acquisitions. While past performance may not guarantee future returns, we take the view that our league table does provide some insights into the track record of the individual S-REITs. Good mix of stability and growth potential. Rental income resilience, total rate of return, accretive distributions and stable payout track record are some of the parameters we scrutinised by delving into the operating history of the S-REITs since their initial public offering. Barring a fullblown European debt crisis, we also think that it is unlikely that S-REITs will be de-rated to the levels seen during the global financial crisis (GFC) due to stronger balance sheets and the absence of credit tightening. Four S-REITs to ride through turbulence. S-REITs currently trade at an average of 0.94x P/BV and 6.8% yield compared to their trough valuations of 0.34x P/BV and 17.2% yield seen at the height of the GFC. Our top four S-REITs are CapitaMall Trust and Frasers Centrepoint Trust in the retail subsector, and Ascendas REIT and Mapletree Logistics Trust in the industrial subsector. Our top SELLs are K-REIT Asia and CapitaCommercial Trust as we see further downside risk in their DPU which would render valuations unattractive. Our Picks
Bloomberg Code Mkt cap (USD m) Current price (SGD) Rating Target price (SGD)
Stocks Top BUYs Ascendas REIT Mapletree Logistics Trust CapitaMall Trust Frasers Centrepoint Trust Top SELLs K-REIT Asia
AREIT SP MLT SP CT SP FCT SP KREIT SP
5,789 3,047 7,700 1,728 3,247 4,497
2.05 0.975 1.815 1.625 0.98 1.23
BUY BUY BUY BUY SELL SELL
2.23 1.06 2.20 1.79 0.83 1.06
CapitaCommercial Trust CCT SP Closing price as at 31 May 2012 Source: Maybank KE
SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS
Singapore REITs
Investment Summary Track record matters. We examined the total rate of return of the 10 largest S-REITs since their listing, namely, those with a trading history of at least five years, and put forward our pristine picks to ride through the impending economic down cycle. Good mix of stability and growth potential. Rental income resilience, total rate of return, accretive distributions and stable payout track record are some of the parameters we scrutinised by delving into the operating history of the S-REITs since their initial public offering. Our sector picks are based on the stocks past track record of DPU accretions as well as projected performance in FY12F-13F. Figure 1 summarises the parameters of our bottom-up approach.
Figure 1: Stock selection criteria
Summary Past Performance Listing history Equity fund raising (EFR) record Total rate of return (TRR) Trading history > 5 years. Do not substantially dilute shareholders. Track record of REIT. Total returns to shareholder since IPO/listing. - Rental income resilience during crisis (lease expiry, arrears ratio) - No refinancing risk (debt maturity, minimal covenants, preferably no CMBS) - No occupancy/concentration risks - Sponsor support Investment properties not devalued substantially during crisis (NAV decline). - Asset enhancement, solid growth profile - Positive rental reversion - Acquisition potential within 12 months - Better-than-expected ROI from recent acquisitions - Yield attractiveness (on a relative basis) - DPU accretion over FY12F-13F Parameters
Stable DPU payout Asset devaluation Future Projected Performance Organic growth Acquisition growth DPU accretion Source: Maybank KE
Top BUYs. Barring a flare-up of new macro-sensitivities that could derail our base case, our top four S-REIT picks are CapitaMall Trust (CMT) and Frasers Centrepoint Trust (FCT) in the retail subsector, and Ascendas REIT (A-REIT) and Mapletree Logistics Trust (MLT) in the industrial subsector. CDLHT, riding the tourism boom, also appears attractive but we remain wary of macro-economic headwinds curtailing business and leisure travel. Its relative yield of around 6.5% also poses concern for investors, who may be better off with the more defensive industrial and retail REITs. Top SELLs. We would avoid the relatively more cyclical office subsector as occupancy pressure could translate to further downside risks for earnings. Our top SELLs are office landlords K-REIT Asia and CapitaCommercial Trust (CCT) as we see further downside risk in their DPU which would render valuations unattractive.
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Singapore REITs
Surviving turbulence
Stronger post-GFC. We note that most of the S-REITs have emerged from the GFC stronger and with healthier balance sheets, forthcoming acquisition proposals, overseas expansion and more asset enhancement work being done. YTD, the sector has returned an average of 11.2%, compared to -16% in 2011 and 10.6% in 2010, and during the GFC, 69% in 2009 and -59% in 2008. With the end of the GFC, four new REITs listed on the SGX-ST Cache Logistics Trust (12 Apr 2010), Mapletree Industrial Trust (21 Oct 2010), Sabana Shariah Compliant Industrial REIT (26 Nov 2010) and Mapletree Commercial Trust (27 Apr 2011). The asset-expansion years of 2010-12 were a stark contrast to 2008-09 when most of the S-REITs were burdened with deleveraging plans, decompressing cap rates and rights issues.
Figure 2: YTD price performance of members in the FTSE REIT sub-index
Source: Bloomberg, Maybank KE
Figure 3: FSTI ST REIT Index

1200 1100 1000 900 800 700 600 500 400 300 FSTREI Index +1stdev Avg -1 stdev
Total rate of return (TRR) study. From the retail investors perspective, we analysed the total returns (capital return + distributions) since listing of the 10 largest S-REITs with a trading history of at least five years. We have assumed that they subscribed 100% to all rights issues and divested their positions on 31 May 2012 closing price. Of the 10, only Suntec REIT and
Frasers Centrepoint Trust have not made any rights issue to-date, though Suntec did a private placement in 2010. Private placements typically dilute the shareholdings of retail investors, but the subsequent share price adjustments will correct for our TRR computation.
4 June 2012 Page 3 of 32
Sep-02 Dec-02 Mar-03 Jun-03 Sep-03 Dec-03 Mar-04 Jun-04 Sep-04 Dec-04 Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12
200
Singapore REITs
Figure 4: Total rate of return study

S-REITs CDL Hospitality Trusts Ascendas Real Estate Investment Trust Frasers Centrepoint Trust CapitaCommercial Trust CapitaMall Trust Mapletree Logistics Trust Suntec Real Estate Investment Trust Starhill Global REIT Ascott Residence Trust K-REIT Asia Source: Bloomberg, Maybank KE Years listed 5.87 9.53 5.90 8.05 9.87 6.84 7.47 6.69 6.17 6.09 Total return since IPO/listing 126% 211% 101% 110% 142% 83% 94% 27% 22% 13% Annualised return Subsector 14.92% HOSPITALITY 12.65% INDUSTRIAL 12.50% RETAIL 9.65% OFFICE 9.35% RETAIL 9.26% INDUSTRIAL 9.26% OFFICE/RETIAL 3.60% RETAIL 3.30% HOSPITALITY 2.01% OFFICE
Our league table offers a sneak peek. As expected, REITs in the more resilient subsectors such as industrial and retail having endured SARs, the subprime crisis and GFC topped our league table with the best performers being CDL Hospitality Trusts (CDLHT), Ascendas Real Estate Investment Trust (A-REIT) and Frasers Centrepoint Trust (FCT). CDLHT stands out, its share price having soared by about 151% since 2008 on the heels of a tourism boom. The worst performer was K-REIT Asia, dragged down by a 17-for-20 rights issue for the OFC acquisition in 2011 and a 1-for-1 rights issue in 2009 and an 8-for-5 rights issue in 2008 for acquiring one-third ORQ interest and Prudential Tower Strata. While past performance may not guarantee future returns, we take the view that our league table does provide some insights into the track record of the individual REITs. Debt maturity well spread out. An analysis of the sectors debt maturity profile suggests that refinancing risk is low. S-REITs average term to expiry improved from 2.7 years since 2008-09 to 3.14 years as of 31 Mar 2012. Sector gearing remains healthy at 34.5%, compared to 40.7% at the height of the GFC. The debt maturity profile is also better spaced out with no more than SGD5.2b to be refinanced each year. As of 31 Mar 2012, debt among the S-REITs maturing by 2017 stands at approximately SGD22.3b.
Figure 5: Debt maturity profile of S-REITs* (as of 31 Mar 2012)
6,000 5,000 4,000 3,000 2,000 1,000 0 2012 2013 2014 2015 2016 2,593
11% 21% 22% 22% 16%
(S$'m)
Debt Maturing [LHS] 4,828 5,126
Proportion to Total Debt [RHS] 5,106

Avg. term to maturity: 3.14 yrs Sector Gearing: 34.5%
40% 35% 30% 25% 20% 15%
3,671
968
4%
966
4%
10% 5% 0%
2017
>=2017
*Excludes Fortune REIT and Saizen REIT. Source: Bloomberg, Maybank KE
4 June 2012
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Singapore REITs
Figure 6: Debt maturity profile of S-REITs (as of 31 Mar 2012)

(SGD m) Office Frasers Commercial Trust CapitaCommercial Trust K-REIT Asia Suntec REIT Office subtotal 0 0 535 200 735 608 197 100 670 1,575 0 350 635 773.5 1,759 138 730 825 681.5 2,375 0 776 428 370.0 1,574 0 0 0 0 0 0 0 0 0 0 2012 2013 2014 2015 2016 2017 >=2017
Retail CapitaMall Trust Frasers Centrepoint Trust Starhill Global REIT CapitaRetail China Trust Lippo-Mapletree Indonesia Mapletree Commercial Trust Retail subtotal Healthcare Parkway Life REIT First REIT Healthcare subtotal 9 0 9 50 48.2 98 185 0 185 217 51 268 0 0 0 49 0 49 0 0 0 783.0 80 26 40.0 0 0 929 580 55 548 150.5 0 282.2 1,616 500.0 60 1 120.3 147.5 338.6 1,167 800 25 259 88.0 0 339 1,510 598.7 264 25 50 0 169.3 1,107 250 70 0 0 0 0 320 0 0 0 0 0 0 0
Hospitality Ascott Residence Trust CDL Hospitality REIT Hospitality subtotal Industrial Ascendas REIT Cambridge Industrial Trust AIMS AMP Capital Indus REIT Mapletree Industrial Trust Mapletree Logistics Trust Cache Logistics Trust Sabana Shariah Comp. Indus REIT Industrial subtotal 376 0 0 84 239 0 0 699 2,593 (11%) 257 0.0 130.0 251 299 0 44 981 4,828 (21%) 395 266.5 29 344 135 249 321 1,739 5,126 (22%) 300 50 123.0 126 30 0 0 629 5,106 (22%) 350 100 0 139 75 0 0 664 3,671 (16%) 375 0 0 0 224 0 0 599 968 (4%) 348 0 0 125 493 0 0 966 966 (4%) 221 0 221 106 452 558 275 0 275 241 84 325 327 0 327 0 0 0 0 0 0
S-REITs total Source: Companies
Resilience is the name of the game. Barring a full-blown European debt crisis, we think it is unlikely that S-REITs will decline to irrationally low levels as in the days of the GFC. This is partly because S-REITs have stronger balance sheets this time around. Moreover, interest rates are still relatively low and a tightening of credit (credit crunch) among financial institutions, which prevailed in 2008-09, has yet to occur.
4 June 2012
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Singapore REITs
Figure 7: Cash calls in the midst of the subprime crisis and the GFC
S-REITs FCOT CCT K-REIT Asia Suntec REIT CMT Starhill Global A-REIT MLT Cash call 3-for-1 rights issue@SGD0.095 1-for-1 rights issue@SGD0.59 8-for-5 rights issue@SGD1.39 Private placement@SGD1.37 9- for-10 rights issue@SGD0.82 Date announced 30-Jun-09 22-May-09 25-Mar-08 11-Dec-09 09-Feb-09 Reason Refinancing of the maturing debt Reduce borrowings Partly repay debt and finance 1/3 stake of ORQ Strengthen balance sheet and capital structure Repay borrowings Pare down some of its existing debt Reduce aggregate leverage and fund development projects Repay borrowings
1- for-1 rights issue@SGD0.32 22-Jun-09 Private placement & preferential offering 15-Jan-09 @SGD1.16 3- for-4 rights issue@SGD0.73 24-Jun-08
Stay selective, stay invested. The unfolding of the Eurozone crisis, the slow US economic recovery and the prospect of a slowing economy in China will no doubt increase the downside risk to investors. With the European debt crisis lingering and possibly worsening, global markets look set to remain volatile. Elevated inflation also does not justify holding on to cash for too long. We recommend that investors be selective with S-REITs and stay invested but only in the right counters. Four S-REITs to ride through turbulence. Rental income resilience, TRR, accretive distributions and stable payout track record are some of the parameters we scrutinised by delving into the operating history of the S-REITs since their initial public offering. Barring a full-blown European debt crisis, we also think that it is unlikely that S-REITs will be de-rated to GFC levels, due to stronger balance-sheets and the absence of credit tightening. Sector valuations. S-REITs currently trade at an average 0.94x P/BV and 6.8% yield compared to their trough valuations of 0.34x P/BV and 17.2% yield seen at the height of the GFC.
Figure 8: Price-to-book of S-REITs in various subsectors
Min (midst of GFC) 31-Dec-07 Office Retail Healthcare Hospitality Industrial Overall S-REITs 0.20x 0.44x 0.47x 0.27x 0.46x 0.34x 0.74x 1.35x 0.83x 1.22x 1.34x 1.07x 31-Dec-08 0.30x 0.55x 0.53x 0.46x 0.55x 0.45x 31-Dec-09 31-Dec-10 31-Dec-11 YTD 2012 0.89x 1.01x 0.87x 1.09x 1.13x 0.99x 0.87x 1.08x 1.08x 1.16x 1.38x 1.07x 0.59x 0.93x 1.11x 0.85x 1.01x 0.83x 0.73x 1.01x 1.18x 0.99x 1.09x 0.94x
Figure 9: Distribution yields of S-REITs in various subsectors

Max (midst of GFC) 31-Dec-07 Office Retail Healthcare Hospitality Industrial Overall S-REITs Source: Bloomberg 21.5% 13.9% 11.7% 25.1% 18.4% 17.2% 3.9% 4.1% 8.7% 3.8% 6.0% 4.5% 31-Dec-08 14.6% 10.2% 10.9% 14.8% 15.1% 13.0% 31-Dec-09 31-Dec-10 31-Dec-11 YTD 2012 7.5% 5.8% 7.0% 5.3% 7.4% 6.7% 5.6% 5.3% 5.9% 5.4% 6.7% 5.7% 8.0% 6.2% 6.5% 7.8% 7.9% 7.3% 5.5% 6.2% 7.0% 6.1% 7.6% 6.8%
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Singapore REITs
Figure 10: Valuation matrix

Stocks REITs Ascendas REIT Cache Logistics Trust CapitaCommercial Trust CapitaMall Trust CDL Hospitality Trusts Frasers Centrepoint Trust K-REIT Asia Mapletree Logistics Trust Starhill Global REIT Suntec REIT Source: Maybank KE 5,789 929 4,497 7,700 2,309 1,728 3,247 3,047 1,577 3,718 $2.05 $1.23 $1.815 $1.625 $0.98 $0.975 BUY SELL BUY BUY SELL BUY $2.23 $1.08 $1.06 $2.20 $1.92 $1.79 $0.83 $1.06 $0.65 $1.285 8.8% 4.3% -13.8% 21.2% 4.6% 10.2% -15.3% 8.7% 4.0% 0.0% 13.45 8.09 7.3 9.8 12 9.57 6.9 6.98 4.24 9.19 6.6% 7.8% 5.9% 5.4% 6.5% 5.9% 7.0% 7.2% 6.8% 7.2% 15.3% 12.2% -7.9% 26.6% 11.2% 16.0% -8.3% 15.9% 10.8% 7.2% 8.4% 8.4% 4.1% 5.9% 7.0% 5.7% 3.2% 7.7% 5.1% 5.5% 34.1% 31.4% 30.3% 35.2% 25.7% 32.3% 37.8% 35.4% 30.3% 37.1% $1.035 HOLD Mkt Cap (USDm) Current Price Rating Target Price Upside / (downside) 2012f DPU (Cents) 2012F DPU Total return 2012F 2012f yield (%) (%) RoE (%) D/A (%)
$1.835 HOLD
$0.625 HOLD $1.285 HOLD
4 June 2012
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Singapore REITs
S-REITs in a changing landscape

In the series of charts below, we highlight the forward DPU yield performance of S-REITs in our coverage universe against the backdrop of a changing economic landscape. It should be noted that the different yields reflect the different risk levels individual REITs face as a result of a wide array of factors including subsector dynamics, sponsor support, access to capital, debt rating, leverage ratio, management quality and location of properties. Ideally, a balanced portfolio would contain different kinds of REITs tailored to the investors risk profile.
Figure 11: Forward DPU Yields of our coverage universe
Ascendas REIT Cache Logistic REIT
CapitaCommercial Trust
CDL Hospitality Trusts
CapitaMall Trust
Frasers Centrepoint Trust
K-REIT Asia
Mapletree Logistics Trust
Starhill Global REIT
Suntec REIT
Source: Bloomberg 4 June 2012 Page 8 of 32
Singapore REITs
Figure 11: S-REITs /Real Estate Business Trusts yield table (as at 31 Mar 2012)
Book Cons Cons value PriceFY-2 FY-12 FY-13 Leverage per unit Market Cap in YTD Equity Free FY-1 toFloat Distribution ratio Last local urrency % DPU DPU Yield Yield (in book Price Currency (m) Change (%) frequency (in cents)(in cents) (%) (%) (%) SGD) (x)
Bloomberg Bloomberg
Office CapitaCommercial Trust Frasers Commercial Trust K-REIT Asia Suntec REIT Indiabulls Properties Investment Trust (Biz Trust) Treasury China Trust (Biz Trust) Office Average Retail CapitaRetail China Trust CapitaMall Trust Fortune REIT Frasers Centerpoint Trust Lippo-Mapletree Indonesia Mapletree Commercial Trust Starhill Global REIT Perennial China Retail Trust (Biz Trust) Retail Average Healthcare First REIT Parkway Life REIT Healthcare Average Hospitality Ascott Residence Trust CDL Hospitality REIT Hospitality Average Industrial AIMS AMP Capital Indus REIT Ascendas India Trust (Biz Trust) Ascendas REIT Cache Logistics Trust Cambridge Industrial Trust Mapletree Industrial Trust Mapletree Logistics Trust Sabana Shariah Comp. Indus REIT Industrial Average Residential Saizen REIT Residential Average S-REITs Average Source: Bloomberg , Maybank KE 0.137 SGD 184 SGD184 SGD40,578 -2.1% 88.9% Semi-Anl NM NM 6.8 NM NM 7.0 31.6 31.6 33.7 0.4 0.4 1.6 0.3 0.3 0.9 1.145 0.765 2.000 1.030 0.535 1.150 0.975 0.950 SGD SGD SGD SGD SGD SGD SGD SGD 510 591 4,472 721 636 1,874 2,366 607 SGD11,776 21.2% 10.9% 9.3% 8.4% 12.6% 7.0% 15.4% 8.6% 92.3% 68.2% 77.2% 81.6% 80.1% 69.4% 58.8% 88.4% Quarter Semi-Anl Quarter Quarter Quarter Quarter Quarter Quarter 11.30 6.80 13.90 8.30 4.90 8.60 7.00 9.50 12.00 7.20 14.30 8.60 5.10 6.90 9.9 10.5 8.9 7.0 8.1 9.2 9.4 7.2 8.3 9.5 7.7 9.8 7.8 29.5 23.4 36.5 27.3 35.1 37.8 41.3 26.9 35.6 1.41 0.71 1.88 1.02 0.62 1.02 0.86 0.99 1.3 0.8 1.1 1.1 1.0 0.9 1.1 1.1 1.0 1.1 1.060 1.850 SGD SGD 1,203 1,788 SGD2,990 7.1% 19.7% 50.6% 67.5% Semi-Anl Semi-Anl 8.40 11.50 8.70 11.80 7.9 6.2 6.9 8.2 6.4 7.1 40.7 25.5 31.6 1.31 1.58 1.5 0.8 1.2 1.0 0.875 1.830 SGD SGD 551 1,107 SGD1,659 15.1% 2.2% 76.8% 57.3% Quarter Quarter 7.00 9.80 7.20 8.00 8.23 10.50 5.36 5.74 6.2 6.6 14.9 35.2 28.4 0.80 1.49 1.3 1.1 1.2 1.2 1.255 1.795 4.330 1.645 0.375 0.920 0.635 0.460 SGD SGD HKD SGD SGD SGD SGD SGD 865 5,977 7,327 1,354 818 1,718 1,234 517 SGD13,698 9.1% 5.6% 15.2% 14.2% 7.1% NM 12.4% NM 60.3% 61.1% 60.9% 59.0% 55.7% 48.8% 70.5% 37.3% Semi-Anl Quarter Semi-Anl Quarter Quarter Quarter Quarter Semi-Anl 9.20 10.00 29.30 9.50 NM 6.00 4.20 3.90 9.50 7.33 7.57 10.60 5.57 5.91 31.80 6.77 7.34 10.00 5.78 6.08 NM NM NM 6.10 6.52 6.63 4.50 6.61 7.09 3.30 8.48 7.17 6.2 6.4 30.2 40.3 25.6 30.9 9.5 39.0 30.2 1.4 33.0 1.27 1.59 7.81 1.42 0.57 0.91 0.87 0.67 1.9 1.0 1.1 0.6 1.2 0.7 1.0 0.7 0.7 1.0 1.235 0.945 0.990 1.290 0.104 1.450 SGD SGD SGD SGD SGD SGD 3,505 606 2,534 2,875 384 368 SGD10,271 17.1% 27.7% 19.3% 19.5% -25.7% 0.7% 67.8% 72.9% 16.1% 89.8% 14.9% 64.7% Semi-Anl Semi-Anl Quarter Quarter None Irreg 7.50 6.40 7.10 9.10 NM 1.30 7.60 6.07 6.15 7.40 6.77 7.83 7.10 7.17 7.17 8.90 7.05 6.90 NM NM 6.5 NM 6.6 5.00 0.90 3.45 30.2 35.8 37.4 37.4 20.7 33.9 34.1 1.58 1.38 1.27 1.99 0.45 4.41 1.7 0.8 0.7 0.8 0.6 0.2 0.3 0.70
8.80 7.48 9.30 10.0 7.6
7.2 7.08
4 June 2012
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Singapore REITs
BUY (from HOLD)

Share price: Target price: SGD2.05 SGD2.23
Ascendas REIT
Slow and Steady Wins the Race

Positioned for growth. Ascendas REIT (A-REIT) is one of the best performers in our TRR study, with an annualised TRR of 12.65%. It also has a proven track record of portfolio expansion. Its ongoing asset enhancement initiatives, development projects and recent acquisitions would continue to drive growth in distributable income. We resume coverage on the stock and upgrade our recommendation to BUY from HOLD with the target price of SGD2.23 Busy, busy. With the acquisition of the multi-tenanted Cintech properties at the Science Park completed, A-REIT now owns 101 properties in Singapore and one business park property in China. The REIT has several development and asset enhancement projects that are expected to wrap up in the coming quarters. We believe that these initiatives and the recent acquisition would spur growth in distributable income. We forecast DPU yield of 6.6% for FY3/13F. Positive rental reversion to continue. A-REIT achieved positive rental reversions of 5.2-15.7% across all its industrial subsectors in FY3/12 despite a slowdown in the domestic economy. Portfolio occupancy rate was healthy at 96.4%. We expect A-REIT to continue to enjoy positive rental reversions as the current market rates are at least 16% higher than its passing rents for the leases due for renewal in FY13F. Strong capital management gives peace of mind. A-REIT has a wellbalanced debt maturity profile with not more than SGD400m due for refinancing in any one year. Its funding structure is well balanced between debt instruments and bank loans. 62.2% of its interest rate exposure is fixed for the next 4.2 years and its weighted average all-in cost of debt has declined from 3.84% as of Dec 2010 to 3.5% as of Mar 2012. Conviction BUY among industrial REITs. We like A-REIT for its stable DPU yield that is underpinned by portfolio diversification (business/science parks, hi-tech industrials, flatted factories, light industrials, logistics and distribution centres and warehouse retail). Potential acquisitions overseas could provide further upside for DPU growth. Importantly, A-REIT is also less vulnerable to asset erosion, with its defensive properties located primarily in Singapore. We upgrade the stock to BUY from HOLD with a DDM-derived target price of SGD2.23.
Ascendas REIT Summary Earnings Table
FYE Dec(SGD m) Revenue Net property income Distributable income DPU (cents) DPU growth (%) DPU yield (%) P/BV(x) FY10 447.6 339.4 248.0 13.2 1.0 6.5 1.2 35.1 17.6 10.7 FY11 FY12F FY13F 503.3 511.8 524.1 368.3 371.4 379.6 281.7 280.9 289.7 13.6 13.5 13.9 2.5 -0.8 3.0 6.6 6.6 6.8 1.1 1.1 1.1 37.6 12.6 7.5 34.1 8.4 4.9 33.9 8.5 5.0 FY14F 541.8 392.6 300.5 14.3 3.6 7.0 1.0 33.7 8.6 5.1
ONG Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470
Stock Information
Description: Ascendas REIT (A_REIT) is a property trust constituted by a trust deed. A-REIT owns and invests in a diverse, income producing portfolio of business park (including science park), light industrial, hi-tech industrial and logistics properties in Singapore. Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: Ascendas Funds Mgmt Ltd AREIT SP 2,236.0 3,491.0 7.4 2,759.58 77 % 18.1
Key Indicators
ROE annualised (%) Debt to deposited assets (%): NAV/shr (SGD): Interest cover (x): 7.5 36.6 1.87 5.3
Historical Chart
Performance: 52-week High/Low 1-mth -3.4 4.3
SGD2.16 /SGD1.815 3-mth -2.4 5.3 6-mth 0.0 0.1 1-yr -1.0 13.8 YTD 9.8 5.3
Gearing (Debt to deposited assets) (%) ROE (%) ROA (%) Source: Company, Maybank KE
Absolute (%) Relative (%)
4 June 2012
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Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec Gross Revenue Property expenses Net Property Income Finance income Performance fees Management fees Trust expenses Finance expense Net income b/f tax & change in Change in FV of Inv Pty Others Income tax Total return Non-tax deductibles & o'er adj Distributable income DPU (cts)
2010A 447.6 -108.2 339.4 3.3 -5.4 -24.7 -3.6 -77.7 233.7 344.8 1.1 -1.0 578.6 9.4 248.0 13.2 2011A 503.3 -135.0 368.3 5.4 -29.1 -29.1 -5.0 -64.2 274.5 224.5 -4.2 -1.6 493.2 9.0 281.7 13.6 2012F 511.8 -140.4 371.4 6.6 -31.7 -31.7 -5.1 -70.3 271.0 61.7 0.0 -1.6 332.7 5.0 280.9 13.5 2013F 524.1 -144.5 379.6 6.5 -32.4 -32.4 -5.2 -69.1 279.4 63.4 0.0 -1.6 342.8 5.1 289.7 13.9 2014F 541.8 -149.2 392.6 5.4 -33.0 -33.0 -5.3 -69.5 290.0 64.8 0.0 -1.6 354.9 5.2 300.5 14.3
BALANCE SHEET (SGD m) YE Dec Total assets Current assets Cash & equivalent Trade receivables Non-current assets Investment properties Plant & equipment Others Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds 2010A 5,419.8 38.0 8.1 28.5 5,381.8 5,254.6 2.8 124.4 2,128.2 671.6 119.5 349.9 202.2 2,128.2 820.3 1,307.8 3,291.7 2011A 6,564.4 59.7 19.6 38.4 6,504.6 6,170.3 1.8 332.6 2,649.0 753.7 116.2 575.5 62.0 2,649.0 1,044.5 1,604.5 3,915.4 2012F 6,745.2 80.5 41.4 39.0 6,664.8 6,335.8 1.2 327.7 2,773.3 439.5 120.9 257.0 61.6 2,773.3 2,046.2 727.2 3,971.9 2013F 6,833.6 51.7 11.7 40.0 6,781.9 6,480.7 0.9 300.4 2,795.0 584.2 124.5 395.0 64.7 2,795.0 1,923.2 871.8 4,038.6 2014F 6,926.0 50.0 8.7 41.3 6,876.0 6,603.6 0.6 271.8 2,817.2 496.4 128.5 300.0 68.0 2,817.2 2,033.2 784.1 4,108.8
CASH FLOW (SGD m) YE Dec Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Net income margin ROA ROE Stability Gross debt/asset (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS
2010A
2011A 8.2 6.1 291.0 5.6 1.0
2012F 12.4 8.5 -14.8 13.6 2.5 73.2 98.0 7.5 12.6 37.6 39.2 5.3 -0.7 5.1 23.7 13.6 15.8 187.8 24.1
2013F 1.7 0.8 -32.5 -0.3 -0.8 72.6 65.0 4.9 8.4 34.1 35.7 4.9 -1.8 5.0 16.0 13.5 16.9 190.2 24.5
2014F 2.4 2.2 3.0 3.1 3.0 72.4 65.4 5.0 8.5 33.9 35.3 5.0 -1.1 6.4 16.5 13.9 21.0 193.1 25.1
77.4 35.8 3.0 5.0 31.5 32.2 4.2 -1.6 4.1 8.2 13.1 15.2 157.2 22.1
75.8 129.3 10.7 17.6 35.1 36.1 4.0 -0.7 3.9 30.9 13.2 16.0 175.6 23.9
KEY RATIOS (SGD m) YE Dec Operating cash flows Total return before tax Adjustments for Net interest expense Depreciation Mgt fees in units Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Purchase of Pty Properties under development Others Financing cash flows Equity net proceeds Borrowing costs Net borrowing proceeds Distribution to unitholders Others Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow
2010A 300.6 233.7 74.4 1.3 4.9 -2.3 -3.5 -7.8 0.0 -370.1 -0.2 -9.0 -239.2 -91.0 -30.6 68.9 0.0 -69.3 378.4 -237.7 -2.5 -0.6 8.7 0.0 8.1 291.3
2011A 328.8 274.5 58.8 1.1 5.8 0.9 -6.8 -5.4 -0.1 -850.5 -0.1 -37.5 -474.2 -196.5 -142.2 533.4 400.0 -65.5 479.3 -270.1 -10.3 11.8 8.1 -0.2 19.6 291.3
2012F 352.3 271.0 70.3 0.7 6.3 0.0 -0.6 4.7 0.0 -103.4 -0.2 -5.0 0.0 -98.3 0.0 -227.1 0.0 -71.6 -95.0 -280.9 220.5 21.8 19.6 0.0 41.4 347.2
2013F 440.0 279.4 69.1 0.5 6.5 0.0 -40.0 124.5 0.0 -54.3 -0.1 -5.0 0.0 -49.1 0.0 -415.4 0.0 -70.4 15.0 -289.7 -70.3 -29.7 41.4 0.0 11.7 434.8
2014F 453.7 290.0 69.5 0.3 6.6 0.0 -41.3 128.5 0.0 -29.7 -0.1 -5.0 0.0 -24.6 0.0 -427.1 0.0 -70.9 15.0 -300.5 -70.6 -3.0 11.7 0.0 8.7 448.6
Source: Company, Maybank KE
4 June 2012
Page 11 of 32
Singapore REITs
HOLD
Cache Logistics Trust
Defensive Play with Stable Income Stream

Defensive play. Cache Logistics Trust is a defensive play, not least because of its 100% occupancy rate and fixed rental escalation. It also provides an attractive yield. Cache has 11 high-quality logistics properties, which are 100% leased with triple-net master lease structures (operating expenses borne by lessee) and locked-in annual rental escalations of about 1.5-2%. Modern ramp-up warehouses account for 86% of its portfolio GFA, a trait which distinguishes it from its competitors. Its aggregate leverage stands at 27.7%. Under the Property Funds Appendix (Code on Collective Investment Schemes), Cache is permitted to borrow up to 35.0% of total assets, which gives it a comfortable debt headroom of SGD103m for additional acquisitions or asset enhancement initiatives. YTD Cache has under-performed the FSTI REIT Index by 2.4%, but outperformed the Straits Times Index (STI) by 4%. Its forward yield of about 7.8% for FY12F compares favourably with the overall S-REITs sector average DPU yield of 6.8%. Leading ramp-up logistics provider in Singapore. Seven of Caches 11 properties are modern ramp-up logistics properties (21.2% market share in Singapores ramp-up warehouses), equipped with large vehicular ramps for easy access. All properties are also relatively new, with a weighted average age of 4.8 years. This means that less capex will be required for asset enhancements in the near term. In addition, ramp-up warehouses are more resilient as their rents are likely to recover faster than conventional cargo-lift warehouses when the economy improves and conversely would be less severely impacted during a downturn. Stable recurring income adds resiliency. Cache enjoys stable rental income streams as seven of its properties are on triple-net master lease to its sponsor (CWT) and CWTs parent (C&P). The master lease agreements are also secured by a 12-month rental deposit in the form of cash or bankers guarantees. Caches weighted average lease expiry is 4.4 years and most of its assets have 1.5-2% rental step-up clauses. The stable lease structures provide a high degree of predictable cash flow and stable earnings for the trust, making Cache a defensive play in turbulent markets. Assume coverage with HOLD and TP of SGD1.08. Cache also has the right of first refusal to a rich pipeline of CWT/C&P-owned assets for future acquisitions. It is in the midst of acquiring Pandan Logistics Hub from CWT for SGD66m. We forecast an initial yield on cost of 7.9% with average rent of SGD1.39 psf pm and 2.5% pa rental escalation. More yield-accretive acquisitions above its FY11 existing portfolio yield of 7.35% provide further catalyst for re-rating. We assume coverage with a HOLD rating on valuation grounds and target price of SGD1.08.
Cache Logistics Trust Summary Earnings Table
FYE Dec(SGD m) Revenue Net property income Distributable income DPU (cents) DPU growth (%) DPU yield (%) P/BV(x) Gearing (Debt to Total Assets) (%) ROE (%) ROA (%) Source: Company, Maybank KE FY2011 64.6 61.9 52.5 8.2 47.4 8.0 1.1 29.6 11.8 8.2 FY2012F 71.2 67.7 56.9 8.1 -1.7 7.8 1.1 31.4 8.4 5.6 FY2013F 75.6 71.8 59.9 8.5 4.7 8.2 1.1 31.7 8.9 6.0 FY2014F 76.4 72.5 60.2 8.5 -0.1 8.2 1.1 32.1 8.9 5.9
Stock Information
Description: Cache Logistics Trust is a Singapore-based REIT. The REIT invests in income-producing real estate used for logistics purposes in Asia-Pacific, as well as real estaterelated assets. Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (m): ST Index: Free float (%): Major Shareholders: CWT Ltd CACHE SP 699.9 560.0 1.1 2,759.58 81.6% % 10
Key Indicators
ROE annualised (%) Debt to deposited assets (%): NAV/shr (SGD): Interest cover (x): 7.27 27.7 0.93 8.0
Historical Chart
SGD1.06/SGD0.915 3-mth 3.0 11.2 6-mth 8.4 8.5 1-yr 9.6 26.0 YTD 8.4 4.0
4 June 2012
Page 12 of 32
Singapore REITs
Figure 12: Maybank KE rental assumptions for Pandan Logistics Hub

FY12F Average passing rent (SGD) Occupancy Period occupied (mths) Gross rent (SGD m) Turnover NPI (SGD m) Yield on cost Source: Company, Maybank KE 1.39 100% 5.74 2.62 2.49 7.9% FY13F 1.40 100% 12.00 5.54 5.26 8.0% FY14F 1.44 100% 12.00 5.68 5.40 8.2% FY15F 1.47 100% 12.00 5.82 5.53 8.4%
4 June 2012
Page 13 of 32
Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec (SGD m) Gross Revenue Property expenses Net Property Income Net financing costs Manager's fees Trustee's fees Other trust expenses Other Income Net income b/f tax & change in FV Change in FV of Inv Pty Income tax Total return Non-tax deductibles & o'er adj Income available for Dist. Distributable income DPU (cts) 2010A 42.4 -1.1 41.4 -6.1 -3.3 -0.2 -0.6 0.0 31.2 30.8 0.0 62.0 -26.6 35.4 35.4 5.6 2011A 64.6 -2.7 61.9 -8.9 -5.0 -0.2 -1.3 0.0 46.5 23.7 -0.4 69.8 17.3 52.5 52.5 8.2 2012F 71.2 -3.6 67.7 -9.8 -5.6 -0.3 -1.4 0.0 50.6 4.2 0.0 54.9 2.0 56.9 56.9 8.1 2013F 75.6 -3.8 71.8 -10.9 -5.9 -0.3 -1.5 0.0 53.3 5.7 0.0 59.0 0.9 59.9 59.9 8.5 2014F 76.4 -3.8 72.5 -11.3 -6.0 -0.3 -1.5 0.0 53.5 5.8 0.0 59.3 0.9 60.2 60.2 8.5 CASH FLOW (SGD m) YE Dec (SGD m) Operating cash flows Net Income before tax Adjustments for Net interest expense Depreciation Mgt fees in units Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Purchase of Pty Properties under devt Others Financing cash flows Equity net proceeds Borrowing costs Net borrowing proceeds Distribution to unitholders Others Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow 2010A 41.6 31.2 6.1 0.0 2.5 0.0 -0.1 1.9 0.0 -713.3 -0.1 0.0 -713.2 0.0 0.0 679.7 556.3 -10.2 178.0 -23.1 -21.3 8.0 0.0 0.0 8.0 41.5 2011A 62.0 46.5 8.9 0.0 3.8 0.0 -0.2 3.1 -0.1 -74.3 0.0 -6.6 -67.7 0.0 0.0 16.4 0.0 -7.2 75.0 -51.4 0.0 4.1 8.0 -0.1 12.1 55.4 2012F 66.6 50.6 9.8 0.0 4.2 0.0 0.0 2.0 0.0 -109.1 0.0 -8.0 -101.2 0.0 0.0 46.1 59.1 -8.0 51.7 -55.8 -0.9 3.5 12.1 0.0 15.6 58.6 2013F 69.0 53.3 10.9 0.0 4.4 0.0 0.0 0.5 0.0 -8.0 0.0 -8.0 0.0 0.0 0.0 -60.4 0.0 -8.9 7.6 -59.2 0.0 0.6 15.6 0.0 16.2 61.1 2014F 69.4 53.5 11.3 0.0 4.5 0.0 0.0 0.1 0.0 -8.0 0.0 -8.0 0.0 0.0 0.0 -62.6 0.0 -9.3 6.8 -60.2 0.0 -1.2 16.2 0.0 15.0 61.4
BALANCE SHEET (SGD m) YE Dec (SGD m) Total assets Current assets Cash & equivalent Trade receivables Non-current assets Investment properties Plant & equipment Others Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds
2010A 752.2 8.1 8.0 0.1 744.1 744.0 0.1 0.0 177.1 3.1 3.1 0.0 0.0 173.9 172.7 1.3 575.1
2011A 855.2 12.3 12.1 0.2 842.9 842.8 0.1 0.0 261.1 6.0 6.0 0.0 0.0 255.1 248.9 6.2 594.1
2012F 972.1 15.8 15.6 0.3 956.3 956.2 0.1 0.0 315.7 8.0 8.0 0.0 0.0 307.7 302.4 5.3 656.4
2013F 986.5 16.5 16.2 0.3 970.0 969.9 0.1 0.0 325.8 8.5 8.5 0.0 0.0 317.3 312.0 5.3 660.7
2014F 999.1 15.3 15.0 0.3 983.8 983.7 0.1 0.0 334.8 8.6 8.6 0.0 0.0 326.2 320.9 5.3 664.4
KEY RATIOS YE Dec (SGD m) Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Total return margin ROA ROE Stability Gross debt/asset (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS
2011A 52.2 49.7 12.6 48.1 47.4 95.8 108.1 8.2 11.8 29.6 30.0 6.2 6.2 7.0 11.0 8.2 9.7 92.99 10.1
2012F 10.3 9.3 -21.4 8.4 -1.7 95.0 77.0 5.6 8.4 31.4 31.9 6.2 6.2 6.8 7.8 8.1 9.5 93.37 10.1
2013F 6.1 6.1 7.6 5.3 4.7 95.0 78.1 6.0 8.9 31.7 32.3 5.9 5.9 6.4 8.3 8.5 9.8 93.39 10.7
2014F 1.0 1.0 0.5 0.5 -0.1 95.0 77.7 5.9 8.9 32.1 32.6 5.7 5.7 6.1 8.3 8.5 9.7 93.34 10.7
4 June 2012
Page 14 of 32
Singapore REITs
HOLD
CDL Hospitality Trusts
Cyclical Hospitality Weighs on Defensiveness

Pure play on Singapore hospitality. CDL Hospitality Trusts (CDREIT) has a stake in 2,716 rooms in Singapore (or 5.6% of all hotel rooms) as at end-2011. It derived 77-84% of its revenue from Singapore and the region accounted 82.5% of its asset value. We believe that CDREIT is the purest play on the booming Singapore hospitality sector, and the increase in average room rates (ARRs) in FY11 has been a boon for the company. The bulk of its rent from Singapore is variable (60.3% as of 1Q12). However, CDREITs assets have consistently enjoyed better occupancy rates than the rest of the system due to their central location and high share of business travellers. Thus, we expect its Singapore assets to maintain robust occupancy of 85-88% and ARR to stay above SGD230 over FY12F-13F, barring a downturn in the global economy. Another acquisition due this year. CDREIT has set its sights on acquiring hospitality assets worth SGD200-300m each year. It bought Studio M Hotel, Singapore, in early-2011 for SGD150m and we believe it still has sufficient room for another acquisition in FY12-13. With a target gearing of 40%, CDREIT has further headroom of SGD503m for acquisitions. Management has previously found the Japanese and Australian hospitality sectors attractive. Singapore QoQ ARR growth a key share price driver. In our view, the main trigger for CDREITs share price is overall ARR growth for the Singapore hotel segment. CDREITs share price exhibits a high correlation (72%) to Singapore hotels QoQ ARR growth. Nonetheless, we remain wary of macro-economic headwinds and its drag on business and leisure travellers. A deeper-than-expected global slowdown might lead to a sudden drop in tourist numbers, which could adversely impact the stocks performance. We also think the 2,586 and 3,909 hotel rooms scheduled to be completed in 2012 and 2013 respectively will put pressure on ARRs. Assume coverage with HOLD and TP of SGD1.92. With volatility in the stock markets and more hotel rooms coming on-stream, we would advise investors to be cautious ahead. CDREIT has risen 19% YTD and 151% since end-2008, in the midst of the GFC. At FY12F DPU yield of 6.5% (on a relative basis), we think investors are better off with the more defensive industrial and retail REITs such as A-REIT (~7% yield) and FCT (~6% yield).
CDL Hospitality REIT Summary Earnings Table
FYE Dec(SGD m) Revenue Net property income Distributable income DPU (cents) DPU growth (%) DPU yield (%) P/BV(x) Gearing (Debt to deposited assets) (%) ROE (%) ROA (%) Source: Company, Maybank KE FY2010 FY2011 FY2012F FY2013F FY2014F 122.3 141.1 150.4 141.9 139.4 115.1 135.2 144.1 136.0 133.6 100.7 118.1 126.3 118.5 113.2 10.2 11.1 12.0 11.9 11.6 18.9 8.3 8.6 -0.5 -3.0 5.6 6.0 6.5 6.5 6.3 1.2 1.1 1.1 1.2 1.2 20.4 25.2 25.7 25.6 26.0 9.3 11.4 7.0 6.5 6.2 7.3 8.3 5.1 4.8 4.5
Ong Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470
Stock Information
Description: CDL Hospitality Trusts is a stapled group comprising H-REIT and HBT. H-REIT is a real estate investment trust that invests in a portfolio of incomeproducing properties and HBT is a business trust. Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: Hospitality Holdings CDREIT SP 966.2 1,396.0 1.9 2,759.58 67.5% % 32.5
Key Indicators
ROE (%) Debt to deposited assets (%): NAV/shr (SGD): Interest cover (x): 11.4 25.6 1.58 9.7
Historical Chart
SGD1.50/SGD0.94 3-mth 8.5 17.1 6-mth 27.0 27.1 1-yr -9.3 4.3 YTD 20.4 15.4
4 June 2012
Page 15 of 32
Singapore REITs
Figure 13: ARRs and occupancy to come under pressure with 6,495 hotel rooms to be added over 2012-13 (6,391 now under construction)
Source: URA 1Q12 Realis Data
4 June 2012
Page 16 of 32
Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec Gross Revenue Property expenses Net Property Income Finance income Performance fees Management fees Trust expenses Finance expense Others Net income b/f tax & change in FV Change in FV of Inv Pty Others Income tax Total return Non-tax deductibles & o'er adj Income avail. for distri. DPU (cts) 2010A 122.3 -7.2 115.1 4.0 0.0 -10.2 -0.2 -20.5 -1.2 86.9 51.4 0.0 -2.4 135.9 -35.2 100.7 10.2 2011A 141.1 -5.9 135.2 1.4 0.0 -11.7 -0.2 -14.6 -2.5 107.6 73.2 0.0 -4.5 176.3 -58.2 118.1 11.1 2012F 150.4 -6.3 144.1 1.0 0.0 -12.3 -0.4 -16.4 -2.5 113.5 0.0 0.0 -4.5 109.0 17.3 126.3 12.0 2013F 141.9 -6.0 136.0 1.1 0.0 -11.9 -0.4 -16.2 -2.5 106.0 0.0 0.0 -4.5 101.5 17.0 118.5 11.9 2014F 139.4 -5.8 133.6 1.4 0.0 -11.8 -0.4 -19.4 -2.5 100.8 0.0 0.0 -4.5 96.3 16.9 113.2 11.6
CASH FLOW (SGD m) YE Dec Operating cash flows Total return Adjustments for Net interest and non-cash Depreciation Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Purchase of Pty Others Financing cash flows Equity net proceeds Borrowing costs Net borrowing proceeds Distribution to unitholders Others Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow 2010A 116.3 135.9 24.7 0.0 -48.9 -1.7 6.3 0.0 -244.4 0.0 -6.7 -237.9 0.2 190.2 200.0 -12.4 87.3 -80.5 -4.2 62.1 5.7 0.0 67.7 109.6 2011A 131.1 176.3 24.1 0.0 -68.7 -2.9 3.1 -0.7 -166.2 0.0 -12.4 -154.5 0.6 37.8 0.0 -13.1 153.6 -102.3 -0.5 2.7 67.7 0.0 70.5 118.8 2012F 139.8 109.0 25.2 0.0 5.3 -1.2 1.5 0.0 -5.1 0.0 -6.1 0.0 1.0 -124.0 0.0 -16.4 16.1 -111.3 -12.5 10.8 70.5 0.0 81.3 133.7 2013F 129.6 101.5 24.6 0.0 3.8 1.1 -1.4 0.0 -5.0 0.0 -6.1 0.0 1.1 -148.7 0.0 -16.2 -3.9 -116.2 -12.5 -24.1 81.3 0.0 57.2 123.5 2014F 128.0 96.3 27.5 0.0 4.3 0.3 -0.4 0.0 -4.8 0.0 -6.2 0.0 1.4 -140.4 0.0 -19.4 6.2 -114.7 -12.5 -17.2 57.2 0.0 40.0 121.8
BALANCE SHEET (SGD m) YE Dec Total assets Current assets Cash & equivalent Trade receivables Others Non-current assets Investment properties Plant & equipment Others Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds
2010A 1,869.9 82.7 67.8 15.0 0.0 1,787.2 1,787.1 0.0 0.1 409.7 21.8 20.6 0.0 1.2 387.9 381.1 6.7 1,460.2
2011A 2,118.5 88.5 70.5 18.0 0.0 2,029.9 2,029.8 0.0 0.1 570.8 23.6 22.7 0.0 0.8 547.2 534.8 12.5 1,547.7
2012F 2,144.5 100.5 81.3 19.2 0.0 2,044.0 2,043.9 0.0 0.1 589.2 75.0 24.2 50.0 0.8 514.1 500.9 13.3 1,555.3
2013F 2,133.4 75.3 57.2 18.1 0.0 2,058.1 2,058.0 0.0 0.1 583.2 73.7 22.9 50.0 0.8 509.5 497.0 12.5 1,550.2
2014F 2,130.0 57.8 40.0 17.8 0.0 2,072.2 2,072.2 0.0 0.1 588.8 73.3 22.5 50.0 0.8 515.5 503.2 12.3 1,541.3
KEY RATIOS YE Dec Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Net income margin ROA ROE Stability Gross debt/Asset (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS
2010A 33.3 33.9 105.6 32.7 18.9 94.1 111.1 7.3 9.3 20.4 21.3 5.2 5.2 5.7 15.1 10.2 12 152 13
2011A 15.4 17.5 29.8 17.4 8.3 95.8 124.9 8.3 11.4 25.2 26.3 8.4 8.4 9.0 18.3 11.1 14 160 15
2012F 6.6 6.6 -38.2 6.9 8.6 95.8 72.5 5.1 7.0 25.7 27.0 7.9 2.0 8.5 11.3 12.0 14 160 16
2013F -5.6 -5.6 -6.9 -6.2 -0.5 95.8 71.5 4.8 6.5 25.6 26.6 7.5 1.8 8.0 10.4 11.9 13 159 15
2014F -1.8 -1.8 -5.2 -4.5 -3.0 95.8 69.1 4.5 6.2 26.0 26.7 6.2 1.7 6.6 9.9 11.6 13 157 14
4 June 2012
Page 17 of 32
Singapore REITs
BUY
Frasers Centrepoint Trust

Pure Exposure to Suburban Retail
Pure exposure to suburban retail. Frasers Centrepoint Trust (FCT) is one the best performers in our TRR study, with an annualised TRR of 12.5%, and it has not done any equity fund-raising since its initial public offering. With investments in five malls located in the suburbs, FCT offers pure exposure to suburban retail space. Its portfolio, valued at SGD1.7b, has a total NLA of ~0.88m sq ft and an occupancy rate of 93.5%. FCT achieved 11% positive rental reversion in 2Q12 and 9.6% in 1Q12, in line with our expectations that suburban asking rentals will continue to climb at 2% pa in FY12F-13F. No refinancing needs until FY16. FCTs next major refinancing is due only in FY16 (SGD264m or 48% of borrowings), while only SGD80m is due this financial year. Gearing is relatively low at 30.9%, implying debt headroom of SGD114m based on managements guided target gearing of 35%. Should opportunities for acquisitions arise, gearing can be stretched up to 45%, with debt headroom of SGD461m. DPU upside. We forecast 7.5% DPU CAGR growth from FY11F-14F in view of positive rental reversions and resilience of the suburban malls. Asset enhancement works on Causeway Point is also on track for full completion in Dec 2012 with occupancy expected to improve from 91.3% to 100%. Management remains confident that (1) average psf rental will increase by 20% from SGD10.20 (2011) to SGD12.20 and (2) NPI will increase by 22% (incremental NPI of SGD9.3m), with ROI of 13% from a capex of SGD71.8m. Resilience play, assume coverage with BUY. The suburban retail sector (with necessity shopping) is historically one of the most resilient sectors through economic cycles. Though the global growth outlook remains murky and risks lean towards the downside, we are confident that FCT, with a NLA lease expiry of 2.03 years, will be able to ride out this economic morass. We like its defensive assets and strong balance sheet. At the current price, FCT is trading at 5.9% FY12F yield. We assume coverage with a BUY rating and a DDM-derived target price of SGD1.79. Further catalysts stem from accretive acquisitions (such as sponsors Changi City Point, Centrepoint and possibly Compass Point recent SGD519m purchase by a JV between Prudential UK and Frasers Centrepoint) and asset enhancement initiatives.
Frasers Centrepoint Trust Summary Earnings Table
FYE Sep(SGD m) Revenue Net property income Distributable income DPU (cents) DPU growth (%) DPU yield (%) P/BV(x) Gearing (Debt to deposited assets) (%) ROE (%) ROA (%) Source: Company, Maybank KE FY2010 FY2011 FY2012F FY2013F FY2014F 114.7 117.9 134.4 142.6 147.8 80.1 82.6 94.8 107.7 111.7 59.2 64.4 78.8 82.2 85.6 8.2 8.3 9.6 10.0 10.3 9.2 1.5 15.0 4.1 3.8 5.0 5.1 5.9 6.1 6.4 1.3 1.2 1.2 1.2 1.2 30.3 31.3 32.3 32.6 32.9 9.5 13.4 5.7 6.8 7.1 6.2 8.7 3.6 4.3 4.5
Stock Information
Description: Frasers Centrepoint Trust is a retail real estate investment trust focused on growing unitholder value through asset management, financial management and strategic investments. The trust invests in retail properties in Singapore and overseas.
Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: Frasers Centrepoint
FCT SP 822.9 1,041.9 0.9 2,759.58 59 % 40.8
Key Indicators
ROE annualised (%) Debt-to-deposit assets (%): NAV/shr (SGD): Interest cover (x): 13.4 30.9 1.42 5.49
Historical Chart
Performance: 52-week High/Low 1-mth Absolute (%) Relative (%) 2.2 10.3
4 June 2012
Page 18 of 32
Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec Gross Revenue Property expenses Net Property Income Finance income Performance fees Management fees Trust expenses Finance expense Net income b/f tax & change in FV Change in FV of Inv Pty Share of associate's profit Others Income tax Total return Non-tax deductibles & o'er adj Income avail for Distribution Distributable income DPU (cts) 2010A 114.7 -34.7 80.1 0.0 0.0 -8.2 -1.2 -17.7 53.0 42.5 4.6 -5.0 -0.6 94.4 -35.2 59.2 59.2 8.20 2011A 117.9 -35.3 82.6 0.0 0.0 -8.9 -1.5 -19.1 53.1 97.2 4.6 -2.6 2.6 154.9 -90.5 64.4 64.4 8.32 2012F 134.4 -41.5 94.8 0.1 0.0 -10.1 -1.9 -21.5 61.5 0.0 4.6 0.0 0.0 66.0 12.8 78.8 78.8 9.57 2013F 142.6 -44.6 107.7 0.1 0.0 -10.7 -2.0 -20.8 74.3 0.0 4.6 0.0 0.0 78.9 3.3 82.2 82.2 9.96 2014F 147.8 -46.2 111.7 0.1 0.0 -11.1 -2.1 -21.2 77.5 0.0 4.6 0.0 0.0 82.1 3.5 85.6 85.6 10.34 BALANCE SHEET (SGD m) YE Dec Total assets Current assets Cash & equivalent Trade receivables Non-current assets Investment properties Plant & equipment Investment in associate Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds 2010A 1,516.2 22.7 19.8 2.9 1,493.5 1,439.0 0.1 54.3 526.9 351.1 35.5 305.0 10.6 175.8 155.0 20.8 992.3 2011A 1,786.8 35.9 30.5 5.4 1,750.9 1,697.0 0.1 53.8 635.0 211.4 41.0 155.0 15.4 423.6 404.0 19.6 1,156.2 2012F 1,817.5 37.9 33.9 4.0 1,779.6 1,725.7 0.1 53.8 665.7 242.1 43.0 183.7 15.4 423.6 404.0 19.6 1,156.2 2013F 1,827.3 40.5 36.3 4.3 1,786.7 1,732.8 0.1 53.8 675.5 251.9 45.6 190.9 15.4 423.6 404.0 19.6 1,156.2 2014F 1,838.9 42.2 37.8 4.4 1,796.7 1,742.8 0.1 53.8 687.1 263.6 47.3 200.9 15.4 423.6 404.0 19.6 1,156.1
CASH FLOW (SGD m) YE Dec Operating cash flows Net Income Adjustments for Net interest expense Depreciation Mgt fees in units Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Purchase of Pty Properties under development Others Financing cash flows Equity net proceeds Borrowing costs Net borrowing proceeds Distribution to unitholders Others Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow 2010A 79.7 53.0 17.7 0.0 2.5 -0.9 -0.4 7.9 0.0 -290.8 -0.1 -9.9 -284.8 0.0 4.0 219.3 178.1 -14.4 111.0 -55.4 0.0 8.3 11.5 0.0 19.8 69.8 2011A 81.6 53.1 19.1 0.0 8.1 -3.0 -1.1 5.3 0.0 -156.9 0.0 -36.7 -123.9 0.0 3.8 86.0 66.7 -13.2 99.0 -62.6 -4.0 10.7 19.8 0.0 30.5 44.8 2012F 89.2 61.5 21.5 0.0 3.0 -0.1 1.4 2.0 0.0 -14.6 0.0 -28.7 0.0 0.0 14.1 -71.3 0.0 -21.2 28.7 -78.8 0.0 3.4 30.5 0.0 33.9 60.5 2013F 100.6 74.3 20.8 0.0 3.2 -0.1 -0.2 2.6 0.0 -2.6 0.0 -7.2 0.0 0.0 4.5 -95.6 0.0 -20.5 7.2 -82.2 0.0 2.4 33.9 0.0 36.3 93.4 2014F 103.4 77.5 21.2 0.0 3.3 -0.1 -0.2 1.7 0.0 -5.5 0.0 -10.0 0.0 0.0 4.5 -96.4 0.0 -20.9 10.0 -85.6 0.0 1.5 36.3 0.0 37.8 93.4
KEY RATIOS YE Dec Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Net income margin ROA ROE Stability Gross debt/equity (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS 2010A 32.5 33.7 132.1 26.1 9.2 69.8 82.3 6.2 9.5 30.3 32.0 2.2 0.1 4.5 12.3 8.2 10 129 15 2011A 2.7 3.2 64.0 8.8 1.5 70.1 131.4 8.7 13.4 31.3 32.9 2.0 0.2 4.3 20.0 8.3 10 140 14 2012F 14.0 14.7 -57.4 22.4 15.0 70.5 49.1 3.6 5.7 32.3 34.1 2.1 0.2 4.2 8.0 9.6 11 140 16 2013F 6.1 13.7 19.5 4.4 4.1 75.5 55.3 4.3 6.8 32.6 34.3 2.8 0.3 4.8 9.6 10.0 12 139 17 2014F 3.6 3.7 4.1 4.0 3.8 75.6 55.6 4.5 7.1 32.9 34.7 2.9 0.3 4.9 9.9 10.3 12 139 18
4 June 2012
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Singapore REITs
SELL
K-REIT Asia
Propped by Temporary Supports

Beleaguered growth, initiate with SELL. K-REIT Asia showed up as the worst performer in our TRR study of 10 REITs, delivering an annualised return of just 2%. Highly exposed to the Grade A office sector in Singapore, yields may fall off a cliff when rental supports for various acquisitions end by 2014. If it proceeds on its growth path, further equity fund-raising is almost inevitable, possibly to the chagrin of unitholders. We initiate coverage on K-REIT with a SELL rating and target price of SGD0.83. Poster boy for the New Downtown. K-REIT has five properties in Singapore and three in Australia in its current portfolio. In Singapore, it has a strong foothold in the New Downtown at Marina Bay, with stakes in One Raffles Quay (ORQ), Marina Bay Financial Centre (MBFC) Ph1 and Ocean Financial Centre (OFC). Its attributable NLA of International Grade A space stands at 1.8m sq ft. Sustainability of yields may be tested. K-REIT has grown by nearly ten-fold in terms of asset size in its six years of listing. Many of the acquisitions, such as ORQ, MBFC Ph1 and OFC, have rental supports which buffer yields typically for the first 3-5 years. However, as the Singapore office sector continues to soften amid the global economic malaise and ample new supply in the pipeline, we estimate that K-REITs DPU yield may contract by 8.4% in FY14F and as much as 15.2% in FY15F, when the various rental supports end. Hungry for another mega-deal? K-REIT is expected to someday acquire Keppel Lands one-third stake in MBFC Ph 2, which is 67% committed and has already obtained its Temporary Occupation Permit in 1Q12. While there is no definite timeline, we estimate that the stake may eventually cost K-REIT around SGD1.0b, valued at a capital value of SGD2,400 psf. With its current look-through gearing already at around 42%, an equity fund-raising will be inevitable. Attractiveness to wane over time. At current levels, K-REIT offers DPU yields of around 7%, mainly backed by the rental supports. Longer term however, DPU yields are likely to normalise to around 5.5%, which is not attractive for a REIT in a sector expected to face economic headwinds. We initiate coverage on K-REIT with a SELL rating and a DDM-derived target price of SGD0.83.
KREIT Asia Summary Earnings Table
FYE Dec (SGD m) Revenue Net property income Distributable income DPU (SG cts) DPU growth (%) DPU yield (%) P/BV (x) Gearing (debt-to-deposited assets) (%) ROE (%) ROA (%) Source: Company, Maybank KE 2010A 84.6 67.3 85.6 6.3 19.6 6.4 0.7 31.8 5.3 3.5 2011A 78.0 61.7 113.0 8.3 30.8 8.3 0.8 37.0 9.1 5.1 2012F 174.7 131.2 178.2 6.9 -15.9 7.0 0.8 37.8 3.2 1.7 2013F 184.6 138.3 184.9 7.2 3.0 7.2 0.8 38.8 3.7 1.9 2014F 197.0 147.1 170.6 6.6 -8.4 6.6 0.8 39.2 4.1 2.1
Wilson LIEW wilsonliew@maybank-ke.com.sg (65) 6432 1454
Stock Information
Description: A commercial REIT under the Keppel Group, K-REIT has a portfolio of International Grade A office properties in Singapore, as well as three office properties in Australia. Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: Keppel Land Keppel Corp KREIT SP 2,559.2 1,958.0 0.8 2,759.58 23.7 % 46.3 30.0
Key Indicators
ROE annualised (%) Debt to deposited assets (%) NAV/shr as at Mar 2012 (SGD) Interest cover (x) 9.1 37.0 1.25 4.0
Historical Chart
SGD1.272/SGD0.80 3-mth 7.1 15.6 6-mth 14.5 14.6 1-yr -17.1 -4.7 YTD 18.7 13.8
4 June 2012
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Singapore REITs
PROFIT AND LOSS (SGD m) FYE Dec Gross Income Operating expenses Net property income Net interest Interest income Interest expense Rental support Managers fees Trust expenses Share of associate income Divestment gain/(loss) Revaluation gain/(loss) Net profit Non-tax deductible expenses Distributable income EBITDA DPU (SG cts) 2010A 84.6 17.3 67.3 -4.8 12.1 -16.8 26.4 -15.1 -28.4 9.7 26.0 31.6 109.2 -23.6 85.6 82.4 6.3 2011A 78.0 16.3 61.7 -5.9 23.0 -28.9 45.6 -23.7 -41.3 37.4 0.0 228.7 296.1 -177.1 113.0 116.4 8.3 2012F 174.7 43.4 131.2 -33.1 20.4 -53.6 78.7 -32.0 -67.2 37.8 0.0 0.0 102.1 84.0 178.2 214.1 6.9 2013F 184.6 46.4 138.3 -33.7 22.1 -55.8 72.8 -32.4 -59.6 44.1 0.0 0.0 117.0 76.8 184.9 221.1 7.2 2014F 197.0 49.9 147.1 -35.5 22.6 -58.1 39.7 -32.8 -35.5 51.4 0.0 0.0 127.6 53.0 170.6 203.7 6.6
CASH FLOW (SGD m) FYE Dec Operating cash flow Net profit Depreciation & amortisation Change in working capital Others Investment cash flow Net capex Change in LT investment Change in other assets Financing cash flow Change in share capital Net change in debt Change in other LT liab. Distribution to unitholders Net cash flow Free cash flow 2010A 323.6 190.3 0.7 28.3 104.3 554.3 -30.0 582.7 1.6 -554.1 -5.0 -263.4 -70.8 -214.9 323.8 876.3 2011A 208.0 196.0 0.4 -66.4 78.0 -238.3 -279.2 39.3 1.6 36.1 -12.7 328.1 -61.8 -217.6 5.8 -32.0 2012F 297.7 187.3 0.3 18.4 91.8 -439.5 0.0 -440.2 0.6 -328.5 -10.0 -62.6 -75.6 -180.4 -470.4 -142.4 2013F 283.1 190.6 0.3 0.5 91.7 5.5 0.0 4.9 0.6 -298.6 -10.9 -28.3 -75.6 -183.8 -10.0 288.0 2014F 213.8 134.3 0.4 0.4 78.6 5.4 0.0 4.9 0.5 -297.5 -9.9 -30.3 -76.3 -181.0 -78.4 218.7
BALANCE SHEET (SGD m) FYE Dec Total assets Current assets Cash & ST investment Trade receivables Inventories Other assets Investment properties Associates ad investments Net fixed assets & others Total liabilities Current liabilities Trade and other payables ST borrowings Current portion of sec deposit Taxation Long-term liabilities Long-term debts Others Unitholders funds Net tangible assets 2010A 3,115.9 72.0 49.9 22.1 0.0 3,043.9 1,025.6 1981.0 37.2 1,060.4 64.3 58.6 0.0 2.4 3.3 996.1 989.9 6.2 2,055.6 2,055.6 2011A 5,856.9 121.9 85.7 30.6 5.6 5,735.0 3,472.1 2112.9 150.0 2,381.4 660.7 144.0 510.1 1.2 5.4 1,720.7 1,655.8 64.9 3,262.6 3,262.6 2012F 6,038.0 323.0 248.9 68.5 5.6 5,715.0 3,482.5 2148.0 84.5 2,588.2 285.8 172.4 100.0 1.2 12.1 2,302.4 2,183.5 118.9 3,229.2 3,229.2 2013F 6,082.6 378.1 300.1 72.4 5.6 5,704.6 3,492.9 2185.0 26.6 2,679.0 296.3 182.3 100.0 1.2 12.8 2,382.7 2,258.5 124.2 3,174.0 3,174.0 2014F 6,101.6 414.2 331.3 77.3 5.6 5,687.5 3,503.4 2184.0 0.0 2,729.5 369.3 194.5 160.0 1.2 13.7 2,360.2 2,229.3 130.9 3,132.4 3,132.4
KEY RATIOS FYE Dec Growth (% YoY) Sales Net property income Distributable income Net profit DPU Profitability (%) Operating margin EBITDA margin Net margin ROA ROE Stability Gross debt/equity (%) Net debt/equity (%) Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Cash flow int. & ST debt (X) Current ratio (X) Quick ratio (X) Net debt (SGD m) Per share data (SG cts) DPU CFPS BVPS SPS EBITDA/share 2010A 2011A 2012F 2013F 2014F
34.6 37.7 21.4 -337.9 19.6 79.6 97.5 129.2 3.5 5.3 48.2 45.7 4.9 -4.0 -19.2 -19.2 1.1 1.1 928.3 6.3 23.7 150.4 6.2 6.0
-7.8 -8.4 31.9 171.1 30.8 79.1 149.3 379.8 5.1 9.1 66.4 63.8 4.0 0.1 -7.2 0.4 0.2 0.2 1,440.6 8.3 8.1 127.1 3.0 4.5
124.0 112.9 57.8 -65.5 -15.9 75.1 122.6 58.4 1.7 3.2 70.7 63.0 4.0 2.8 -5.6 6.4 1.1 1.1 1,915.5 6.9 11.5 124.9 6.8 8.3
5.7 5.4 3.7 14.6 3.0 74.9 119.7 63.4 1.9 3.7 74.3 64.9 4.0 3.1 -5.1 6.4 1.3 1.3 1,925.5 7.2 10.9 121.9 7.1 8.5
6.7 6.4 -7.7 9.0 -8.4 74.7 103.4 64.8 2.1 4.1 76.3 65.7 3.5 1.4 -3.7 2.1 1.1 1.1 1,915.8 6.6 8.2 119.5 7.5 7.8
4 June 2012
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Singapore REITs
BUY
Mapletree Logistics Trust

Acquisitions to Bear Fruit
Scale and stability advantages. Mapletree Logistics Trust (MLT) yielded an annualised TRR of 9.30% in our TRR study. Its recent issue of perpetual securities has also lowered its gearing from 41.4% in 4Q11 to 35.2% in 5Q11. With a portfolio of 109 properties in Asia, MLT is increasingly being viewed as a proxy to the broader Asian logistics sector, a Pan-Asian partner for global players keen to expand their regional footprint. No longer is it just an industrial landlord alongside Global Logistic Properties (GLP), Prologis and Goodman. We believe MLT will continue to reap the benefits of its large installed base, in terms of economies of scale. With a sale-and-leaseback-heavy portfolio, occupancy rate of 98.7% and an average lease expiry of six years, it provides a high degree of predictable cash flow and stable rental income. In addition, MLT has a strong sponsor, Mapletree Investments, and has forged a strategic alliance with Itochu Corporation in Japan. Yield spread vis--vis A-REIT. MLT has historically traded at a oneyear forward DPU yield-spread of 135bps above A-REIT. We believe this premium is due to its footprint in other geographic regions (country risk exposure) and its relative higher gearing. MLT is currently trading at 51bps spread above A-REIT. Acquisitions to bear fruit. MLTs assets have increased by almost ninefold since the company listed in July 2005. Given its larger asset base, macro-economic headwinds and unfavourable risk-reward ahead, we expect management to trade growth for stability in turbulent times. MLT also has one of the industrys highest weighted average lease expiry profiles (six years). Despite having exposure to six overseas markets, Singapore and Japan (tier-1 mature markets) still constitute 73% of revenue and 72% of NPI in FY11 and 70% of our FY12F GAV, which should prove defensive in volatile markets.
Assume coverage with BUY and TP of SGD1.06. MLT has an existing
Stock Information
Description: Mapletree Logistics Trust is an Asia-focused logistics real estate investment trust. The Company invests in a diversified portfolio of income-producing real estate which is used for logistics purposes. Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: Temasek Holdings MLT SP 2,426.3 1,837.5 1.7 2,759.58 58.8 % 41
Key Indicators
ROE annualised (%) Debt to deposited assets (%): NAV/shr (SGD): Interest cover (x): 7.7 35.2 0.90 6
Historical Chart
portfolio yield of 6% as seen in its latest 5Q11* results. Barring further acquisitions, it should be able to maintain relatively stable DPU payouts going forward. Mounting uncertainties in the recent month have skewed risks to the downside but we are confident that MLTs stable assets and rental income resilience will help it navigate the choppy waters. At the current price, MLT is trading at 7.2% FY12F yield. We assume coverage with a BUY rating and target price of SGD1.06.
*5Q11: MLT is changing its financial year from Dec to Mar,
Performance: 52-week High/Low 1-mth Absolute (%) Relative (%) -0.5 7.4
Mapletree Logistics Trust Summary Earnings Table FYE Dec(SGD m) FY2010 FY2011* FY2012F FY2013F FY2014F Revenue 218.9 339.5 286.1 288.6 291.2 Net property income 193.0 293.6 247.4 249.6 251.8 Distributable income 130.1 199.9 169.3 170.8 172.6 DPU (cents) 6.1 8.2 7.0 7.0 7.1 DPU growth (%) 1.2 35.3 -15.3 0.9 1.1 DPU yield (%) 6.2 8.5 7.2 7.2 7.3 P/BV(x) 1.1 1.1 0.9 0.9 0.9 Gearing (Debt to deposited assets) (%) 37.5 35.0 35.4 35.4 35.4 ROE (%) 7.8 14.7 7.7 7.8 7.9 ROA (%) 4.5 7.5 4.0 4.0 4.0 Source: Company, Maybank KE
4 June 2012
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Singapore REITs
Figure 14: MLT FY12F GAV breakdown by geography
South Korea 5%
Vietnam 0%
Japan 29%
Singapore 42%
Malaysia 4% China 4% Hong Kong 16%
4 June 2012
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Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec Gross Revenue Property expenses Net Property Income Interest income Other income Manager's management fees Trustee's fee Other trust expenses Borrowing costs Others Net income b/f tax & change in Change in FV of Inv Pty Others Income tax Total return Non-tax deductibles & o'er adj Distributable income DPU (cts) 2010A 218.9 -25.8 193.0 0.3 0.0 -23.1 -0.5 -2.4 -29.2 0.0 138.1 32.1 0.0 -13.4 162.7 -32.6 130.1 6.1 2011A* 339.5 -46.0 293.6 0.9 0.0 -34.4 -0.7 9.4 -44.4 0.0 224.4 113.0 0.8 -27.9 321.8 -121.9 199.9 8.2 2012F 286.1 -38.7 247.4 0.8 0.0 -29.0 -0.6 -4.6 -34.4 0.0 179.6 0.0 0.0 -10.0 169.6 -0.3 169.3 7.0 2013F 288.6 -39.1 249.6 0.8 0.0 -29.2 -0.6 -4.6 -34.7 0.0 181.2 0.0 0.0 -10.1 171.1 -0.3 170.8 7.0 2014F 291.2 -39.4 251.8 0.8 0.0 -29.5 -0.6 -4.7 -34.7 0.0 183.1 0.0 0.0 -10.2 172.9 -0.3 172.6 7.1 BALANCE SHEET (SGD m) YE Dec Total assets Current assets Cash & equivalent Trade receivables Others Non-current assets Investment properties Plant & equipment Others Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds Perpetual securities Non-controlling interests 2010A 3,614.3 155.1 108.4 21.6 25.1 3,459.2 3,459.2 0.0 0.0 1,539.1 319.3 102.8 172.3 44.2 1,219.8 1,181.8 38.0 2,072.8 0.0 2.4 2011A 4,272.5 214.2 167.6 25.7 20.9 4,058.3 4,058.3 0.0 0.0 1,734.8 427.1 152.4 243.8 30.9 1,307.7 1,251.3 56.4 2,186.4 344.0 7.4 2012F 4,289.7 206.8 169.2 16.7 20.9 4,082.9 4,082.9 0.0 0.0 1,736.5 378.2 129.7 217.8 30.6 1,358.3 1,301.8 56.4 2,201.9 344.0 7.4 2013F 4,290.9 208.0 170.2 16.8 20.9 4,082.9 4,082.9 0.0 0.0 1,737.6 451.9 130.9 290.4 30.6 1,285.7 1,229.2 56.4 2,201.9 344.0 7.4 2014F 4,292.0 209.1 171.2 17.0 20.9 4,082.9 4,082.9 0.0 0.0 1,738.8 206.2 132.0 43.6 30.6 1,532.5 1,476.1 56.4 2,201.9 344.0 7.4
*2011 has a change of FY from Dec to Mar (5 Qtrs)
CASH FLOW (SGD m) YE Dec Operating cash flows Total return Adjustments for Net interest expense Depreciation Revaluation of Inv Pty Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Purchase of Pty Others Financing cash flows New Issue proceeds Borrowing costs Net borrowing proceeds Distribution to unitholders Others Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow 2010A 165.4 162.7 28.0 0.7 -32.1 2.2 -12.7 22.0 -5.4 -566.1 0.0 0.0 -565.1 -1.0 443.3 305.0 -28.2 282.8 -115.5 -0.8 42.6 67.4 -1.6 108.4 165.4 2011A 305.4 321.8 41.6 1.2 -113.0 13.4 -3.8 52.8 -8.7 -514.0 0.0 0.0 -565.6 51.7 267.8 0.0 -38.8 150.3 -190.5 346.7 59.2 108.4 0.0 167.6 305.4 2012F 195.6 169.6 33.7 0.0 0.0 10.0 9.0 -22.7 -4.0 -23.8 0.0 0.0 -24.6 0.8 -170.2 0.0 -31.0 24.6 -169.3 5.5 1.6 167.6 0.0 169.2 195.6 2013F 212.1 171.1 33.9 0.0 0.0 10.1 -0.1 1.1 -4.0 0.8 0.0 0.0 0.0 0.8 -211.9 0.0 -31.2 0.0 -170.8 -9.9 1.0 169.2 0.0 170.2 212.1 2014F 214.1 172.9 33.9 0.0 0.0 10.2 -0.1 1.2 -4.0 0.8 0.0 0.0 0.0 0.8 -213.8 0.0 -31.2 0.0 -172.6 -10.0 1.0 170.2 0.0 171.2 214.1
KEY RATIOS YE Dec Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Net income margin ROA ROE Stability Gross debt/asset (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS 2010A 5.9 6.8 71.8 10.3 1.2 88.2 74.3 4.5 7.8 37.5 39.1 5.7 0.8 5.7 6.7 6.1 7 85.53 9 2011A 55.1 52.1 97.8 53.7 35.3 86.5 94.8 7.5 14.7 35.0 36.8 6.1 0.9 6.9 13.2 8.2 13 90.11 14 2012F -15.7 -15.7 -47.3 -15.3 -15.3 86.5 59.3 4.0 7.7 35.4 37.2 6.2 0.8 5.7 7.0 7.0 8 105.23 12 2013F 0.9 0.9 0.9 0.9 0.9 86.5 59.3 4.0 7.8 35.4 37.2 6.2 0.7 6.1 7.0 7.0 9 105.23 12 2014F 0.9 0.9 1.1 1.1 1.1 86.5 59.4 4.0 7.9 35.4 37.2 6.3 2.8 6.2 7.1 7.1 9 105.23 12
4 June 2012
Page 24 of 32
Singapore REITs
HOLD
Starhill Global REIT

Courting Greater Upside
Deserving better. A prime retail play trading at a sharp 27% discount to its book value, Starhill Global REIT deserves better in our opinion. For one, its key assets are in the coveted Orchard Road area, where tight supply and the entry of new international retailers should give it greater bargaining power in terms of leasing its space. We like Starhill for the rental upside it stands to enjoy in Singapore and income stability in Malaysia and Australia. Courting greater upside. A number of Starhills major leases (42% of gross rent) are due to expire next year. Chief among them is its master lease with Toshin at Ngee Ann City mall that has an option for renewal. If Starhill wins its fight at the Court of Appeal for a transparent rent review mechanism, its ability to maximise the potential for rental increase at the mall would be assured. Currently, the 225,000-sq-ft space is estimated to be leased at low teens psf to Toshin, which then subleases it to luxury brands like Chanel, Louis Vuitton, Burberry and Tiffany & Co. In prime Orchard Road, the average retail rent currently stands at SGD31.60 psf pm, according to CRBE. Race for prime space. CBRE estimates that new supply of retail space will amount to 4.37m sq ft between 2012 and 2015. Of this, only 12.4% or 540,000 sq ft will be located in Orchard Road and the rest in nonprime areas. Several international retailers such as Abercrombie & Fitch and Michael Kors opened their maiden stores in Orchard Road last year and other new-to-market brand names are said to be hunting for prime retail space. We expect Starhill to benefit from the scarcity of new prime retail space and healthy retail sales growth in Singapore. Its asset enhancement initiative at Wisma Atria, targeted for completion by 3Q12, will also boost DPU in the near term. No major refinancing need yet. Starhills next major refinancing is due next year (SGD548m, or 64% of borrowings) and only SGD26m is due this year. Gearing is relatively low at 30.8%, implying debt headroom of SGD451m for acquisitions before hitting managements target of 40%. Consumer discretionary vulnerable, assume coverage with HOLD. Consumer discretionary income is still susceptible to downturns. We caution that macro-economic headwinds may curtail the number of business and leisure travellers who frequent the Orchard Road malls. If this eventuates, Starhills tenant lease structures would provide some protection via rental income but we think it will still inhibit its ability to sustain tenant base growth rates. At 6.8% FY12F yield, we assume coverage with a HOLD rating and DDM-derived target price of SGD0.65.
Starhill Global REIT Summary Earnings Table FYE Dec(SGD m) FY2010 FY2011 Revenue 165.7 180.1 Net property income 130.5 143.6 Distributable income 82.5 90.8 DPU (cents) 3.9 4.1 DPU growth (%) 2.5 5.7 DPU yield (%) 6.2 6.6 P/BV(x) 0.7 0.7 Gearing 29.9 30.5 (Debt to deposited assets) (%) ROE (%) 8.2 5.6 ROA (%) 5.4 3.7 Source: Company, Maybank KE FY2012F 183.0 146.2 91.7 4.2 3.0 6.8 0.7 30.3 5.1 3.4 FY2013F 189.6 151.4 96.1 4.4 3.7 7.0 0.7 30.2 5.3 3.5 FY2014F 194.8 156.9 100.8 4.6 3.9 7.3 0.7 30.0 5.5 3.6
Stock Information
Description: Invests mainly in retail and office assets in Singapore, Malaysia, China, Australia and Japan, and has a portfolio size of SGD2.7bn. Managed by YTL Starhill Global REIT Management Ltd.
Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: YTL Corp Bhd AIA
SGREIT SP 1,943.0 950.8 0.7 2,759.58 70.5 % 28.7 9.8
Key Indicators
ROE annualised (%) Debt to deposit assets (%): NAV/shr (SGD): Interest cover (x): 5.6 30.4 0.96 4.8
Historical Chart
SGD0.665/SGD0.550 3-mth 4.1 12.4 6-mth 9.6 9.7 1-yr -0.8 14.1 YTD 11.5 6.9
4 June 2012
Page 25 of 32
Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec Gross Revenue Property expenses Net Property Income Finance income FV adj on security deposits Management fees Trust expenses Finance expense Net income b/f tax & change in Change in FV of Inv Pty Others Income tax Total return Non-tax deductibles & o'er adj Distributable income DPU 2010A 165.7 -35.2 130.5 0.8 1.8 -13.0 -3.5 -32.3 84.4 76.4 -7.4 -3.3 150.0 -67.6 82.5 3.9 2011A 180.1 -36.5 143.6 0.7 -0.1 -13.9 -3.4 -34.3 92.6 28.3 -11.2 -5.2 104.4 -13.6 90.8 4.1 2012F 183.0 -36.7 146.2 0.7 0.0 -13.9 -3.5 -28.6 101.0 0.0 0.2 -5.3 95.9 5.4 91.7 4.2 2013F 189.6 -38.1 151.4 0.7 0.0 -14.4 -3.6 -28.9 105.3 0.0 0.2 -5.4 100.1 5.6 96.1 4.4 2014F 194.8 -37.9 156.9 0.8 0.0 -14.8 -3.7 -29.2 110.0 0.0 0.2 -5.5 104.7 5.7 100.8 4.6
BALANCE SHEET (SGD m) YE Dec Total assets Current assets Cash & equivalent Trade receivables Non-current assets Investment properties Net fixed assets Others Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds 2010A 2,786.6 117.7 113.0 4.7 2,668.9 2,654.5 0.6 13.8 956.5 60.2 33.5 1.1 25.6 126.7 832.5 63.8 1,830.2 2011A 2,839.1 110.8 108.0 2.5 2,728.3 2,709.7 1.9 16.7 988.1 101.5 42.9 27.9 30.7 896.2 838.3 48.4 1,851.0 2012F 2,855.1 126.7 123.9 2.6 2,728.4 2,709.7 1.9 16.7 989.2 101.9 43.4 27.9 30.7 886.6 838.3 49.0 1,865.9 2013F 2,871.2 142.8 139.9 2.6 2,728.4 2,709.7 1.9 16.8 990.4 102.3 43.8 27.9 30.7 887.3 838.3 49.8 1,880.9 2014F 2,887.5 159.0 156.0 2.7 2,728.5 2,709.7 2.0 16.8 991.5 102.8 44.2 27.9 30.7 888.0 838.3 50.5 1,896.0
CASH FLOW (SGD m) YE Dec Operating cash flows Total return before tax Adjustments for Net interest expense Depreciation Mgt fees in units Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Interest on deposits Others Financing cash flows Equity net proceeds Borrowing costs Net borrowing proceeds Distribution to unitholders Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow
2010A 93.0 -41.6 23.3 0.2 5.6 109.4 0.4 -2.2 -2.1 -15.2 -0.2 -0.5 0.8 0.0 188.1 328.0 -20.2 -47.2 -72.5 265.9 32.7 -0.6 297.9 92.3
2011A 119.1 153.4 31.4 0.3 0.0 0.0 -1.3 4.6 -3.3 -410.0 -7.4 -290.3 0.7 0.0 107.1 0.0 -37.5 221.4 -74.3 -183.8 297.9 -1.0 113.0 -178.6
2012F 131.8 109.6 33.6 0.3 0.0 -16.9 -9.6 17.3 -2.5 -17.1 -1.6 -16.2 0.7 0.0 -121.2 0.0 -31.7 0.5 -80.6 -6.5 113.0 1.4 108.0 114.0
2013F 130.0 101.2 27.9 0.4 5.6 -0.2 -0.1 0.5 -5.3 15.6 -7.6 22.5 0.7 0.0 -129.7 0.0 -28.6 0.0 -91.7 15.9 108.0 0.0 123.9 144.9
2014F 134.6 105.5 28.1 0.4 5.8 -0.2 -0.1 0.5 -5.4 6.3 -7.8 13.4 0.8 1.0 -124.9 0.0 -28.9 0.0 -96.1 16.0 123.9 0.0 139.9 140.2
KEY RATIOS YE Dec Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Net income margin ROA ROE Stability Gross debt/asset (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS
2010A 23.1 22.0 -424.5 9.3 2.5 78.7 90.6 5.4 8.2 29.9 31.4 3.6 3.5 3.7 7.8 3.9 4.8 0.9 8.6
2011A 8.7 10.1 -30.4 10.1 5.7 79.7 58.0 3.7 5.6 30.5 32.0 3.7 2.0 3.8 5.4 4.1 5.5 0.9 9.3
2012F 1.6 1.9 -8.2 1.0 3.0 79.9 52.4 3.4 5.1 30.3 32.0 4.5 2.3 4.5 4.9 4.2 6.0 0.9 8.4
2013F 3.6 3.5 4.4 4.8 3.7 79.9 52.8 3.5 5.3 30.2 32.0 4.6 2.4 4.7 5.1 4.4 6.0 0.9 8.7
2014F 2.7 3.6 4.6 4.9 3.9 80.5 53.7 3.6 5.5 30.0 32.0 4.8 2.4 4.8 5.3 4.6 6.2 0.9 8.9
4 June 2012
Page 26 of 32
Singapore REITs
HOLD
Suntec REIT
Looks Fairly Valued; Office Drag Remains

Prime office and retail play. With investments in five commercial properties in Singapores Central Business District, Suntec REIT offers exposure to prime office (68% of income contribution), retail (29%) and convention space (3%). Its portfolio, valued at SGD7.7b, has a total NLA of 4.1m sq ft with office and retail occupancy rates at 99% and 97%, respectively. Downgrading office rental assumptions. The stock of Grade A office space (including Marina South) will increase by 91% between 2H12 and 2016. Consequently, we expect Grade A office rents to fall by 8-13% in 2013-14; 43.6% of Suntecs office leases are up for renewal in those two years and we expect DPU to decline by 1.8% CAGR over FY11-14. MBFC Phase 2 acquisition unlikely in 2012. Suntec acquired a onethird stake of MBFC Phase 1 from affiliate Cheung Kong four months after its completion in 2010. MBFC Phase 2 was completed in 1Q12. We estimate it will cost Suntec approximately SGD1.04b to acquire a similar one-third stake. If fully debt-funded, the purchase will raise Suntecs aggregate leverage to 46.6% (from 39.2% in 1Q12), above its optimal gearing of 40-45%. Equity fund-raising may be required, which poses a challenge as the stock is trading at a 35% discount to book. We therefore believe that it will be too strenuous for Suntec to complete the acquisition in 2012. Assume coverage with HOLD and TP of SGD1.285. We like Suntecs retail exposure, which not only sets it apart from pure office landlords like K-REIT, but also serves as a buffer should the market take a turn for the worst. Moreover, we do not expect the near-term growth driver (MBFC Phase 2 acquisition) to happen in 2012. At its current price, Suntec is trading at 7.2% FY12F yield. We assume coverage with a HOLD recommendation and DDM-derived target price of SGD1.285. Competition and macro-economic risks remain our top concerns for Suntec and we expect management to take steps to address these issues going forward.
Suntec REIT Summary Earnings Table
FYE Dec(SGD m) Revenue Net property income Distributable income DPU (cents) DPU growth (%) DPU yield (%) P/BV(x) Gearing (Debt to deposited assets) (%) ROE (%) 1-yr -14.0 -1.1 YTD 20.0 15.1 ROA (%) Source: Company, Maybank KE FY2010 FY2011 FY2012F FY2013F FY2014F 249.5 270.3 255.3 276.5 302.0 193.1 182.5 9.9 -15.8 7.7 71.2 39.4 9.7 5.8 193.4 220.7 9.9 0.7 7.7 64.7 38.0 14.3 8.4 197.5 206.9 9.2 -7.5 7.2 64.3 37.1 5.5 3.3 214.0 209.6 9.2 0.4 7.2 64.0 37.4 5.4 3.2 233.7 215.6 9.4 1.9 7.3 63.6 37.1 5.6 3.3
Stock Information
Description: Suntec Real Estate Investment Trust is a real estate investment trust established with the objective of investing in income-producing real estate properties which are used primarily for retail and office properties.
Ticker: Shares Issued (m): Market Cap (USD m): 3-mth Avg Daily Turnover (USD m): ST Index: Free float (%): Major Shareholders: Suntec City Development
SUN SP 2,237.4 2,241.9 6.4 2,759.58 89.8 % 6.23
Key Indicators
ROE annualised (%) Debt to deposit assets (%): NAV/shr (SGD): Interest cover (x): 5.7 39.2 1.99 4.2
Historical Chart
SGD1.56/SGD1.05 3-mth 4.9 13.2 6-mth 13.2 13.2
4 June 2012
Page 27 of 32
Singapore REITs
Figure 15:
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
Suntec REIT FY12F GAV

19% 15% 8% 4% 100% 54%
Suntec City (Office + Mall)
Suntec Convention (consolidated if 100%)
Park Mall
MBFC1 One Raffles (33% interest) Quay (33% interest)
Total
Source: Maybank KE
4 June 2012
Page 28 of 32
Singapore REITs
PROFIT AND LOSS (SGD m) YE Dec Gross Revenue Property expenses Net Property Income Share of profit of JCE Other Income Amortisation Costs Management fees Trust expenses Net Financing Costs Others Net income b/f tax & change in Change in FV of Inv Pty Others Income tax Total return Non-tax deductibles & o'er adj Distributable income DPU (cts) 2010A 249.5 -56.4 193.1 30.9 22.4 -20.9 -27.9 -2.7 -55.9 0.0 139.0 248.7 0.0 -2.0 385.7 -203.2 182.5 9.9 2011A 270.3 -76.9 193.4 141.7 47.7 -39.3 -36.1 -5.3 -51.8 0.0 250.3 396.2 -5.9 -6.0 634.6 -413.9 220.7 9.9 2012F 255.3 -57.7 197.5 46.8 31.6 -20.0 -31.4 -2.6 -37.3 0.0 184.8 25.5 39.5 -3.5 246.3 -39.4 206.9 9.2 2013F 276.5 -62.5 214.0 47.6 30.0 -20.0 -32.6 -2.8 -37.7 0.0 198.5 52.3 0.0 -3.3 247.5 -37.9 209.6 9.2 2014F 302.0 -68.3 233.7 56.7 10.0 -20.0 -33.8 -3.0 -38.8 0.0 204.8 54.2 0.0 -1.1 257.8 -42.2 215.6 9.4 BALANCE SHEET (SGD m) YE Dec Total assets Current assets Cash & equivalent Trade receivables Others Non-current assets Investment properties Plant & equipment Others Total liabilities Current liabilities Trade and other payables Short term borrowings Others Long-term liabilities Long-term debts Others Unitholders' funds Non-controlling interests 2010A 6,652.1 59.9 52.5 3.3 4.2 6,592.1 4,452.0 0.0 2140.1 2,667.4 478.9 41.1 404.6 33.2 2,188.5 2,150.1 38.5 3,984.6 0.0 2011A 7,516.7 262.7 104.4 13.6 144.7 7,254.1 5,098.1 7.9 2148.1 2,970.1 305.6 80.9 200.0 24.7 2,664.4 2,604.1 60.3 4,433.8 112.8 2012F 7,489.7 99.7 86.1 12.8 0.8 7,390.0 5,233.2 7.9 2148.9 2,878.6 755.5 60.7 670.0 24.7 2,123.1 2,076.8 46.4 4,498.3 112.8 2013F 7,654.9 81.6 66.9 13.9 0.9 7,573.3 5,415.3 7.9 2150.0 2,979.8 864.0 65.8 773.5 24.7 2,115.7 2,069.4 46.4 4,562.3 112.8 2014F 7,763.2 67.8 51.7 15.2 1.0 7,695.4 5,536.2 7.9 2151.3 3,018.8 778.1 71.9 681.5 24.7 2,240.7 2,194.3 46.4 4,631.5 112.8
CASH FLOW (SGD m) YE Dec Operating cash flows Total return before tax Adjustments for Net interest expense Depreciation Mgt fees in units Others Trade and other receivables Trade and other payables Income tax paid Investing cash flows PPE Capex on Inv Pty & others Purchase of Pty Others Financing cash flows Others Borrowing costs Net borrowing proceeds Distribution to unitholders Net change in cash Beginning cash balance Forex Ending cash balance Free cash flow
2010A 206.4 139.0 55.9 0.0 22.3 -9.6 0.5 4.4 -6.2 -1172.7 0.0 -1.3 0.0 -1,171.5 987.6 419.1 -76.1 830.0 -185.4 21.3 31.2 0.0 52.5 205.1
2011A 216.7 250.3 51.8 1.1 28.3 -102.9 0.4 -10.3 -2.0 -5.6 -0.2 -3.3 -92.6 90.4 -159.1 -2.5 -58.8 112.5 -210.3 51.9 52.5 0.0 104.4 213.2
2012F 158.0 184.8 37.3 0.0 25.1 -66.3 0.8 -20.2 -3.5 110.7 0.0 -109.6 173.5 46.9 -287.0 42.9 -49.1 -73.9 -206.9 -18.3 104.4 0.0 86.1 48.3
2013F 235.4 198.5 37.7 0.0 26.1 -27.6 -1.1 5.1 -3.3 -82.2 0.0 -129.8 0.0 47.6 -172.3 6.9 -49.5 79.8 -209.6 -19.2 86.1 0.0 66.9 105.6
2014F 237.7 204.8 38.8 0.0 27.0 -36.7 -1.3 6.1 -1.1 -10.0 0.0 -66.7 0.0 56.7 -242.9 6.6 -50.6 16.7 -215.6 -15.2 66.9 0.0 51.7 171.0
KEY RATIOS YE Dec Growth (% YoY) Sales NPI Net income Distributable income DPU Profitability (%) NPI margin Net income margin ROA ROE Stability Gross debt/asset (%) Total debt/Investment Prop Int. coverage (X) Int. & ST debt coverage (X) Cash flow int. coverage (X) Per share data (Scts) EPU DPU CFPS NAV SPS
2010A -1.4 0.4 -424.3 -3.8 -15.8 77.4 154.6 5.8 9.7 39.4 40.3 1.5 0.2 3.7 20.3 9.9 9 1.80 11
2011A 8.3 0.2 64.5 20.9 0.7 71.5 234.8 8.4 14.3 38.0 39.7 3.8 0.8 4.2 28.5 9.9 10 1.99 12
2012F -5.6 2.2 -61.2 -6.3 -7.5 77.4 96.5 3.3 5.5 37.1 37.9 3.9 0.2 4.2 10.8 9.2 7 2.00 11
2013F 8.3 8.3 0.5 1.3 0.4 77.4 89.5 3.2 5.4 37.4 37.9 4.3 0.2 6.2 10.4 9.2 10 2.01 12
2014F 9.2 9.2 4.2 2.9 1.9 77.4 85.4 3.3 5.6 37.1 37.4 4.3 0.2 6.1 10.6 9.4 10 2.02 13
4 June 2012
Page 29 of 32
Singapore REITs
RESEARCH OFFICES
REGIONAL
P K BASU Regional Head, Research & Economics (65) 6432 1821 pk.basu@maybank-ke.com.sg WONG Chew Hann, CA Regional Head of Institutional Research (603) 2297 8686 wchewh@maybank-ib.com THAM Mun Hon Regional Strategist (852) 2268 0630 thammunhon@kimeng.com.hk ONG Seng Yeow Regional Products & Planning (852) 2268 0644 ongsengyeow@maybank-ke.com.sg
ECONOMICS
Suhaimi ILIAS Chief Economist Singapore | Malaysia (603) 2297 8682 suhaimi_ilias@maybank-ib.com Luz LORENZO Economist Philippines | Indonesia (63) 2 849 8836 luz_lorenzo@maybank-atrke.com Chaiyachoke SUWISUTTANGKUL Economist Thailand (662) 658 6300 chaiyachoke.s@maybank-ke.co.th
MALAYSIA
WONG Chew Hann, CA Head of Research (603) 2297 8686 wchewh@maybank-ib.com Strategy Construction & Infrastructure Desmond CHNG, ACA (603) 2297 8680 desmond.chng@maybank-ib.com Banking - Regional LIAW Thong Jung (603) 2297 8688 tjliaw@maybank-ib.com Oil & Gas Automotive Shipping ONG Chee Ting (603) 2297 8678 ct.ong@maybank-ib.com Plantations Mohshin AZIZ (603) 2297 8692 mohshin.aziz@maybank-ib.com Aviation Petrochem Power YIN Shao Yang, CPA (603) 2297 8916 samuel.y@maybank-ib.com Gaming Regional Media Power WONG Wei Sum, CFA (603) 2297 8679 weisum@maybank-ib.com Property & REITs LEE Yen Ling (603) 2297 8691 lee.yl@maybank-ib.com Building Materials Manufacturing Technology LEE Cheng Hooi Head of Retail chenghooi.lee@maybank-ib.com Technicals
SINGAPORE
Stephanie WONG Head of Research (65) 6432 1451 swong@maybank-ke.com.sg Strategy Small & Mid Caps Gregory YAP (65) 6432 1450 gyap@maybank-ke.com.sg Technology & Manufacturing Telcos - Regional Wilson LIEW (65) 6432 1454 wilsonliew@maybank-ke.com.sg Hotel & Resort Property & Construction James KOH (65) 6432 1431 jameskoh@maybank-ke.com.sg Logistics Resources Consumer Small & Mid Caps YEAK Chee Keong, CFA (65) 6433 5730 yeakcheekeong@maybank-ke.com.sg Healthcare Offshore & Marine Alison FOK (65) 6433 5745 alisonfok@maybank-ke.com.sg Services S-chips Bernard CHIN (65) 6433 5726 bernardchin@maybank-ke.com.sg Transport (Land, Shipping & Aviation) ONG Kian Lin (65) 6432 1470 ongkianlin@maybank-ke.com.sg REITs / Property Wei Bin (65) 6432 1455 weibin@maybank-ke.com.sg S-chips Small & Mid Caps
THAILAND
Mayuree CHOWVIKRAN Head of Research (66) 2658 6300 ext 1440 mayuree.c@maybank-ke.co.th Strategy Maria BRENDA SANCHEZ LAPIZ Co-Head of Research Dir (66) 2257 0250 | (66) 2658 6300 ext 1399 Maria.L@maybank-ke.co.th Andrew STOTZ Strategist (66) 2658 6300 ext 1399 Andrew@maybank-ke.co.th Suttatip PEERASUB (66) 2658 6300 ext 1430 suttatip.p@maybank-ke.co.th Media Commerce Sutthichai KUMWORACHAI (66) 2658 6300 ext 1400 sutthichai.k@maybank-ke.co.th Energy Petrochem Termporn TANTIVIVAT (66) 2658 6300 ext 1520 termporn.t@maybank-ke.co.th Property Woraphon WIROONSRI (66) 2658 6300 ext 1560 woraphon.w@maybank-ke.co.th Banking & Finance Jaroonpan WATTANAWONG (66) 2658 6300 ext 1404 jaroonpan.w@maybank-ke.co.th Transportation Small cap. Suchot THIRAWANNARAT (66) 2658 6300 ext 1550 suchot.t@maybank-ke.co.th Automotive Construction Materials Soft commodity
VIETNAM
Michael KOKALARI, CFA Head of Research +84 838 38 66 47 michael.kokalari@kimeng.com.vn Strategy Nguyen Thi Ngan Tuyen +84 844 55 58 88 x 8081 tuyen.nguyen@kimeng.com.vn Food and Beverage Oil and Gas Ngo Bich Van +84 844 55 58 88 x 8084 van.ngo@kimeng.com.vn Banking Nguyen Quang Duy +84 844 55 58 88 x 8082 duy.nguyenquang@kimeng.com.vn Rubber Dang Thi Kim Thoa +84 844 55 58 88 x 8083 thoa.dang@kimeng.com.vn Consumer Nguyen Trung Hoa +84 844 55 58 88 x 8088 hoa.nguyen@kimeng.com.vn Steel Sugar Macro
HONG KONG / CHINA

Edward FUNG Head of Research (852) 2268 0632 edwardfung@kimeng.com.hk Construction Ivan CHEUNG (852) 2268 0634 ivancheung@kimeng.com.hk Property Industrial Ivan LI (852) 2268 0641 ivanli@kimeng.com.hk Banking & Finance Jacqueline KO (852) 2268 0633 jacquelineko@kimeng.com.hk Consumer Staples Andy POON (852) 2268 0645 andypoon@kimeng.com.hk Telecom & equipment Samantha KWONG (852) 2268 0640 samanthakwong@kimeng.com.hk Consumer Discretionaries Alex YEUNG (852) 2268 0636 alexyeung@kimeng.com.hk Industrial Catherine CHAN (852) 2268 0631 catherinechan@kimeng.com.hk Cement Anita HWANG, CFA | Jacky WONG, CFA anitahwang@kimeng.com.hk | jackywong@kimeng.com.hk (852) 2268 0142 | (852) 2268 0107 Special Situations Quants
INDONESIA
Katarina SETIAWAN Head of Research (62) 21 2557 1125 ksetiawan@kimeng.co.id Consumer Strategy Telcos Lucky ARIESANDI, CFA (62) 21 2557 1127 lariesandi@kimeng.co.id Base metals Coal Oil & Gas Rahmi MARINA (62) 21 2557 1128 rmarina@kimeng.co.id Banking Multifinance Pandu ANUGRAH (62) 21 2557 1137 panugrah@kimeng.co.id Auto Heavy equipment Plantation Toll road Adi N. WICAKSONO (62) 21 2557 1130 anwicaksono@kimeng.co.id Generalist Anthony YUNUS (62) 21 2557 1134 ayunus@kimeng.co.id Cement Infrastructure Property Arwani PRANADJAYA (62) 21 2557 1129 apranadjaya@kimeng.co.id Technicals
INDIA
Jigar SHAH Head of Research (91) 22 6623 2601 jigar@kimeng.co.in Oil & Gas Automobile Cement Anubhav GUPTA (91) 22 6623 2605 anubhav@kimeng.co.in Metal & Mining Capital goods Property Haripreet BATRA (91) 226623 2606 haripreet@kimeng.co.in Software Media Ganesh RAM (91) 226623 2607 ganeshram@kimeng.co.in Telecom Contractor Darpin SHAH (91) 226623 2610 darpin@kimeng.co.in Banking & Financial Services Gagan KWATRA (91 )226623 2612 gagan@kimeng.co.in Small Cap
PHILIPPINES
Luz LORENZO Head of Research +63 2 849 8836 luz_lorenzo@maybank-atrke.com Strategy Laura DY-LIACCO (63) 2 849 8840 laura_dyliacco@maybank-atrke.com Utilities Conglomerates Telcos Lovell SARREAL (63) 2 849 8841 lovell_sarreal@maybank-atrke.com Consumer Media Cement Mining Kenneth NERECINA (63) 2 849 8839 kenneth_nerecina@maybank-atrke.com Conglomerates Property Ports/ Logistics Katherine TAN (63) 2 849 8843 kat_tan@maybank-atrke.com Banks Construction Ramon ADVIENTO (63) 2 849 8842 ramon_adviento@maybank-atrke.com Mining
4 June 2012
Page 30 of 32
Singapore REITs
Definition of Ratings
Maybank Kim Eng Research uses the following rating system: BUY HOLD SELL Total return is expected to be above 15% in the next 12 months Total return is expected to be between -15% to +15% in the next 12 months Total return is expected to be below -15% in the next 12 months
Applicability of Ratings
The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies.
Some common terms abbreviated in this report (where they appear):

Adex = Advertising Expenditure BV = Book Value CAGR = Compounded Annual Growth Rate Capex = Capital Expenditure CY = Calendar Year DCF = Discounted Cashflow DPS = Dividend Per Share EBIT = Earnings Before Interest And Tax EBITDA = EBIT, Depreciation And Amortisation EPS = Earnings Per Share EV = Enterprise Value FCF = Free Cashflow FV = Fair Value FY = Financial Year FYE = Financial Year End MoM = Month-On-Month NAV = Net Asset Value NTA = Net Tangible Asset P = Price P.A. = Per Annum PAT = Profit After Tax PBT = Profit Before Tax PE = Price Earnings PEG = PE Ratio To Growth PER = PE Ratio QoQ = Quarter-On-Quarter ROA = Return On Asset ROE = Return On Equity ROSF = Return On Shareholders Funds WACC = Weighted Average Cost Of Capital YoY = Year-On-Year YTD = Year-To-Date
APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLOSURES AND DISCLAIMERS

This report, and any electronic access to it, is restricted to and intended only for clients of Maybank Kim Eng Research Pte. Ltd. ("Maybank KERPL") or a related entity to KER (as the case may be) who are institutional investors (for the purposes of both the Singapore Securities and Futures Act (SFA) and the Singapore Financial Advisers Act (FAA)) and who are allowed access thereto (each an "Authorised Person") and is subject to the terms and disclaimers below. IF YOU ARE NOT AN AUTHORISED PERSON OR DO NOT AGREE TO BE BOUND BY THE TERMS AND DISCLAIMERS SET OUT BELOW, YOU SHOULD DISREGARD THIS REPORT IN ITS ENTIRETY AND LET KER OR ITS RELATED ENTITY (AS RELEVANT) KNOW THAT YOU NO LONGER WISH TO RECEIVE SUCH REPORTS. This report provides information and opinions as reference resource only. This report is not intended to be and does not constitute financial advice, investment advice, trading advice or any other advice. It is not to be construed as a solicitation or an offer to buy or sell any securities or related financial products. The information and commentaries are also not meant to be endorsements or offerings of any securities, options, stocks or other investment vehicles. The report has been prepared without regard to the individual financial circumstances, needs or objectives of persons who receive it. The securities discussed in this report may not be suitable for all investors. Readers should not rely on any of the information herein as authoritative or substitute for the exercise of their own skill and judgment in making any investment or other decision. Readers should independently evaluate particular investments and strategies, and are encouraged to seek the advice of a financial adviser before making any investment or entering into any transaction in relation to the securities mentioned in this report. The appropriateness of any particular investment or strategy whether opined on or referred to in this report or otherwise will depend on an investors individual circumstances and objectives and should be confirmed by such investor with his advisers independently before adoption or implementation (either as is or varied). You agree that any and all use of this report which you make, is solely at your own risk and without any recourse whatsoever to KER, its related and affiliate companies and/or their employees. You understand that you are using this report AT YOUR OWN RISK. This report is being disseminated to or allowed access by Authorised Persons in their respective jurisdictions by the Maybank Kim Eng affiliated entity/entities operating and carrying on business as a securities dealer or financial adviser in that jurisdiction (collectively or individually, as the context requires, "Maybank Kim Eng") which has, vis--vis a relevant Authorised Person, approved of, and is solely responsible in that jurisdiction for, the contents of this publication in that jurisdiction. Maybank Kim Eng, its related and affiliate companies and/or their employees may have investments in securities or derivatives of securities of companies mentioned in this report, and may trade them in ways different from those discussed in this report. Derivatives may be issued by Maybank Kim Eng its related companies or associated/affiliated persons. Maybank Kim Eng and its related and affiliated companies are involved in many businesses that may relate to companies mentioned in this report. These businesses include market making and specialised trading, risk arbitrage and other proprietary trading, fund management, investment services and corporate finance. Except with respect the disclosures of interest made above, this report is based on public information. Maybank Kim Eng makes reasonable effort to use reliable, comprehensive information, but we make no representation that it is accurate or complete. The reader should also note that unless otherwise stated, none of Maybank Kim Eng or any third-party data providers make ANY warranties or representations of any kind relating to the accuracy, completeness, or timeliness of the data they provide and shall not have liability for any damages of any kind relating to such data. Proprietary Rights to Content. 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4 June 2012
Page 31 of 32
Singapore REITs
Malaysia
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APPENDIX I
Additional information on mentioned securities is available on request. Jurisdiction Specific Additional Disclaimers: THIS RESEARCH REPORT IS STRICTLY CONFIDENTIAL TO THE RECIPIENT, MAY NOT BE DISTRIBUTED TO THE PRESS OR OTHER MEDIA, AND MAY NOT BE REPRODUCED IN ANY FORM AND MAY NOT BE TAKEN OR TRANSMITTED INTO THE REPUBLIC OF KOREA, OR PROVIDED OR TRANSMITTED TO ANY KOREAN PERSON. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF SECURITIES LAWS IN THE REPUBLIC OF KOREA. BY ACCEPTING THIS REPORT, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. THIS RESEARCH REPORT IS STRICTLY CONFIDENTIAL TO THE RECIPIENT, MAY NOT BE DISTRIBUTED TO THE PRESS OR OTHER MEDIA, AND MAY NOT BE REPRODUCED IN ANY FORM AND MAY NOT BE TAKEN OR TRANSMITTED INTO MALAYSIA OR PROVIDED OR TRANSMITTED TO ANY MALAYSIAN PERSON. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF SECURITIES LAWS IN MALAYSIA. BY ACCEPTING THIS REPORT, YOU AGREE TO BE BOUND BY THE FOREGOING LIMITATIONS. Without prejudice to the foregoing, the reader is to note that additional disclaimers, warnings or qualifications may apply if the reader is receiving or accessing this report in or from other than Singapore. As of 4 June 2012, Maybank Kim Eng Research Pte. Ltd. does not have any interest in the companies mentioned. The covering analyst has an interest in Starhill Global REIT. Analyst Certification: The views expressed in this research report accurately reflect the analyst's personal views about any and all of the subject securities or issuers; and no part of the research analyst's compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed in the report. 2012 Maybank Kim Eng Research Pte Ltd. All rights reserved. Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of Maybank Kim Eng Research Pte. Ltd. Maybank Kim Eng Research Pte. Ltd. accepts no liability whatsoever for the actions of third parties in this respect.
Stephanie Wong CEO, Maybank Kim Eng Research
4 June 2012
Page 32 of 32

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Singapore

Co. Reg No: 198700034E MICA (P) : 099/03/2012

AREIT SP MLT SP CT SP FCT SP KREIT SP

5,789 3,047 7,700 1,728 3,247 4,497

2.05 0.975 1.815 1.625 0.98 1.23

BUY BUY BUY BUY SELL SELL

2.23 1.06 2.20 1.79 0.83 1.06

CapitaCommercial Trust CCT SP Closing price as at 31 May 2012 Source: Maybank KE

SEE APPENDIX I FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS

Source: Bloomberg, Maybank KE

Figure 3: FSTI ST REIT Index

Source: Bloomberg, Maybank KE

Figure 4: Total rate of return study

Debt Maturing [LHS] 4,828 5,126

Proportion to Total Debt [RHS] 5,106

40% 35% 30% 25% 20% 15%

*Excludes Fortune REIT and Saizen REIT. Source: Bloomberg, Maybank KE

Figure 6: Debt maturity profile of S-REITs (as of 31 Mar 2012)

S-REITs total Source: Companies

Source: Bloomberg, Maybank KE

Source: Bloomberg, Maybank KE

Figure 9: Distribution yields of S-REITs in various subsectors

Figure 10: Valuation matrix

$0.625 HOLD $1.285 HOLD

S-REITs in a changing landscape

CDL Hospitality Trusts

Frasers Centrepoint Trust

Mapletree Logistics Trust

Starhill Global REIT

Source: Bloomberg 4 June 2012 Page 8 of 32

8.80 7.48 9.30 10.0 7.6

BUY (from HOLD)

Slow and Steady Wins the Race

ONG Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470

Performance: 52-week High/Low 1-mth -3.4 4.3

Absolute (%) Relative (%)

2011A 8.2 6.1 291.0 5.6 1.0

Source: Company, Maybank KE

Cache Logistics Trust

Defensive Play with Stable Income Stream

ONG Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470

Performance: 52-week High/Low 1-mth -0.5 7.4

Absolute (%) Relative (%)

Figure 12: Maybank KE rental assumptions for Pandan Logistics Hub

Source: Company, Maybank KE

CDL Hospitality Trusts

Cyclical Hospitality Weighs on Defensiveness

Ong Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470

Performance: 52-week High/Low 1-mth -1.6 6.2

Absolute (%) Relative (%)

Source: URA 1Q12 Realis Data

Source: Company, Maybank KE

Frasers Centrepoint Trust

ONG Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470

FCT SP 822.9 1,041.9 0.9 2,759.58 59 % 40.8

Source: Company, Maybank KE

Propped by Temporary Supports

Wilson LIEW wilsonliew@maybank-ke.com.sg (65) 6432 1454

Performance: 52-week High/Low 1-mth -1.5 6.3

Absolute (%) Relative (%)

Source: Company, Maybank KE

Mapletree Logistics Trust

ONG Kian Lin ongkianlin@maybank-ke.com.sg (65) 6432 1470