Company Name: FRASERS CENTREPOINT TRUST
| Research House: CIMB | Price Call: BUY | Target Price: 1.78 |
CIMB raised its target price on Frasers Centrepoint Trust to $1.78 from $1.75 and kept its outperform rating, citing interest cost savings due to refinancing.
Units of Frasers Centrepoint were up 0.3% at S$1.60 at 10:39 a.m. and have risen around 14% so far this year.
Frasers Centrepoint on Monday issued two new multi-currency medium-term notes worth $70 million at 2.3% and $30 million at 2.85%, due at 2015 and 2017 respectively.
CIMB said it expects part of the proceeds to be channelled towards refinancing the firm’s $75 million multi-term note due in fiscal 2012. Interest cost savings are an estimated 2% of distribution per unit for fiscal 2013, it added.
It expects the remaining $25 million to be used in funding an impending rights issue by Hektar Real Estate Investment Trust (HEKR.KL) to fund the acquisition of two retail assets in Malaysia. Frasers Centrepoint owns 31% of Hektar REIT.
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