Basic Profile & Key Statistics
CapitaLand Integrated Commercial Trust (CICT) invests in mainly Retail and Office properties which currently owns 24 properties in Singapore and Germany.
Performance Review
Lease Profile
- Occupancy is slightly high at 96.4%.
- WALE is short at 3 years where the highest lease expiry of 28.8% falls in 2022.
- Weighted average land lease expiry figure is not accounted for post-merger as information would only be available in the upcoming 2020 annual report.
Debt Profile
- Gearing is slightly high at 40.6%.
- Cost of debt is moderate at 2.8%.
- Fixed rate debt % is moderate at 83%
- Unsecured debt % is high at 95.1%.
- WADE is long at 4.1 years where the highest debt maturity of 16% falls in 2024.
- Interest coverage ratio is moderate at 3.8 times.
Diversification Profile
- Top geographical contribution is high at 94.2%.
- Top property contribution is low at 9.4%.
- Top tenant and top 10 tenants contributions are low at 5.7% and 21.1% respectively.
Key Financial Metrics
- Property yield is low at 4.1%
- Management fees over distribution is moderate at 13.7% in which unitholders receive S$ 7.3 for every dollar paid.
- Distribution on capital is low at 2.7%
- Distribution margin is moderate at 46.1%.
Trends
- Uptrend - NAV per Unit
- Flat - Distribution Margin
- Downtrend - DPU, Interest Coverage Ratio, Property Yield, Distribution on Capital
Relative Valuation
- Dividend Yield - Past 4 quarters DPU @ 8.69 cents / average yield @ 5.12% = S$ 1.70
- Price/NAV - NAV @ S$ 2.015 x average P/NAV @ 1.08 = S$ 2.17
Author's Opinion
| Favorable | Less Favorable |
|---|---|
| Diversified Sector | Short WALE |
| High Unsecured Debt | High Top Geographical Contribution |
| Long WADE | Low Property Yield |
| Well Spread Debt Maturity | Low Distribution on Capital |
| Low Top Property Contribution | DPU Downtrend |
| Low Top Tenant & Top 10 Tenants Contributions | Interest Coverage Ratio Downtrend |
| NAV per Unit Uptrend | Property Yield Downtrend |
| Distribution on Capital Downtrend |
As the merger with CCT only completed on 21 Oct 2020, it is still too early to see the full performance of CICT. With the recent phase 3 opening and vaccination in process, shopper traffic and tenants' sales of retail are expected to be improved. For the office sector, vaccination should also help in the improvement of business sentiment as likely more companies would allow more employees to back to work in the office more frequently. Long term wise, CICT would also be able to benefit from those ongoing AEIs and CapitaSpring upon completion.
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*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee the accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions as well as loss or damage as a result of the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.
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