10 Stanton Road in Sydney, a property in the initial portfolio of Frasers Logistics & Industrial Trust (Photo: Frasers Logistics & Industrial Trust)10 Stanton Road in Sydney, a property in the initial portfolio of Frasers Logistics & Industrial Trust (Photo: Frasers Logistics & Industrial Trust)

DBS Equity Research and OCBC Investment Research have each maintained a ‘Buy’ rating on Singapore-listed industrial REIT, Frasers Logistics & Industrial Trust.

Both cited the REIT’s high occupancy rates, under-geared balance sheet, and resilient portfolio, as some of the reasons behind the recommendation.

Frasers Logistics & Industrial Trust, which holds a portfolio of industrial properties across Australia, reported its financial results for the period spanning 1 October to 31 December 2016 on 3 February 2017, beating DPU forecast for the period by 6.1%.

“With an under-geared balance sheet, [Frasers Logistics & Industrial Trust] has the ability to surprise on the upside through acquisitions, if executed from a myriad of opportunities available from its sponsor”, said DBS in an investment report on 7 February.

“Looking ahead, we expect [the REIT’s]portfolio to remain resilient, as it has minimal lease expiries during the years ending 31 Dec 2017 and 31 Dec 2018”, said OCBC in a separate report on the same day.

“[Frasers Logistics & Industrial Trust’s] portfolio occupancy stood at a healthy 99.3%, as at 31 Dec 2016, and it also has a long portfolio WALE of 6.9 years”, OCBC added.

DBS and OCBC have cited a target price, and a fair value estimate price of SGD1.10 and SGD1.08 respectively.

Units of Frasers Logistics & Industrial Trust finished the trading day about 1% higher 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.