Lippo Malls Indonesia Retail Trust's property, Lippo Malls Kemang. (Photo: Lippo Malls Indonesia Retail Trust)Lippo Malls Indonesia Retail Trust's property, Lippo Malls Kemang. (Photo: Lippo Malls Indonesia Retail Trust)

OCBC Investment Research has maintained its ‘hold’ rating on Singapore-listed retail REIT, Lippo Malls Indonesia Retail Trust (SGX:D5IU), and retained a fair value estimate of SGD0.35 on the security.

The rating and estimate was published in a Market Pulse report published 6 June. OCBC research cited Indonesia’s retail sales momentum which it described as “solid”, increasing 23.6% year-on-year in April despite uncertainties in the country’s economic outlook.

“Lippo Malls Indonesia Retail Trust’s recent 1Q15 results has reflected this positive retail sales trend, as its gross revenue and DPU grew 24.7% and 16.2% year-on-year to SGD42 million and 0.79 Singapore cents, respectively”, said the report.

OCBR Research also opine that the REIT has ample opportunities for growth in the pipeline given that its sponsor, Lippo Karawaci, currently has a portfolio of 15 malls.

“100% of its borrowings are also on a fixed rate basis or hedged with interest rate swaps. We make no changes to our forecasts, ‘hold’ rating and SGD0.35 fair value estimate”, said the report.

Units of Lippo Malls Indonesia Retail Trust are currently listed on the Singapore Exchange at SGD0.365.

Acquisition of Lippo Mall Kemang is set to increase Lippo Malls Indonesia Retail Trust's portfolio value by more than 20%.
Acquisition of Lippo Mall Kemang is set to increase Lippo Malls Indonesia Retail Trust's portfolio value by more than 20%.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.