99 Station Road in Sydney, a property in the initial portfolio of Frasers Logistics & Industrial Trust. (Photo: Frasers Logistics & Industrial Trust)

Brokerage firm UOB Kay Hian has maintained a ‘Buy’ rating on Singapore-listed industrial REIT, Frasers Logistics and Industrial Trust

The rating, which was reiterated in an investment report dated 3 November, came on the back of the REIT’s maiden set of results that was issued earlier in the week.

Frasers Logistics and Industrial Trust achieved a DPU of 1.84 Singapore cents for the period spanning 20 June to 30 September, exceeding the forecast made during its IPO of 1.79 cents by 2.8%.

UOB Kay Hian pointed to Australia’s growing population, which is expected to increase at 1.3% per annum over the next four years, as a factor that will bode well for the REIT.

“This will likely translate into increased domestic consumption, benefiting tenants like supermarket Coles [contributing 14.7% of the REIT’s overall gross rental income], as well as tenants with e-commerce exposure [estimated at 21% by lettable area]”, said UOB Kay Hian.

As such, UOB Kay Hian has also raised the REIT’s target price to SGD1.11 from SGD1.08 previously.

Units of Frasers Logistics and Industrial Trust finished the trading day unchanged from its previous close on the Singapore Exchange to end at SGD0.97.

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.