Company Name: CAPITAMALL TRUST
| Research House: DBS Vickers | Price Call: BUY | Target Price: 2.36 |
DMG & Partners upgraded CapitaMall Trust to ‘buy’ from ‘hold’ and raised its target price to $2.36 from $2.03, citing higher contributions from new shopping malls.
By 10:32 a.m., units of CapitaMall Trust rose 1.4% to $2.16. They have surged 27% since the start of the year, compared with the FTSE ST Real Estate Investment Trust Index’s 35% rise.
CapitaMall Trust’s third-quarter distribution per unit was flat at 2.42 cents compared with a year earlier.
However, DMG expects CapitaMall Trust to post strong earnings going forward, helped by higher contributions from its shopping malls JCube and Bugis+, which opened in April and August respectively.
The trust should also see additional income after renovationat its Orchard Atrium mall in Singapore is completed in the fourth quarter.
“As the hunt for dividend yield plays continues on the back of high liquidity, prolonged low interest rate environment and a strong Singapore currency, we believe CMT has room for further upside,” said DMG in a report.
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